PART I [Key Information](index=6&type=section&id=ITEM%203.%20KEY%20INFORMATION) This section outlines the most significant risks to the company's business, operations, and financial performance [Risk Factors](index=6&type=section&id=D.%20Risk%20Factors) The company identifies material risks including acquisition integration, cybersecurity, termite claims, and a material weakness in internal controls - The company's growth strategy includes significant acquisition activity, having acquired **41 new businesses in 2023**, which presents substantial integration risks[33](index=33&type=chunk) - In 2023, the company encountered seven cybersecurity incidents, and while only one had an immaterial financial impact, this highlights the increasing prevalence of cyber threats[40](index=40&type=chunk) - The legacy Terminix business is subject to a significant number of damage claims related to its termite control services, which could **materially affect financial results**[69](index=69&type=chunk) - A **material weakness in internal control over financial reporting** was identified, stemming from a failure to design and maintain effective IT general controls[82](index=82&type=chunk)[84](index=84&type=chunk) - As of December 31, 2023, the company had approximately **£3.1 billion in aggregate outstanding indebtedness**, governed by agreements that contain restrictive covenants[90](index=90&type=chunk) [Information on the Company](index=19&type=section&id=ITEM%204.%20INFORMATION%20ON%20THE%20COMPANY) This section provides an overview of the company's history, business operations, organizational structure, and physical assets [History and Development of the Company](index=19&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) This subsection details key historical milestones, including the 1996 BET plc acquisition and the 2022 Terminix acquisition - The company became Rentokil Initial in 1996 after acquiring BET plc and significantly expanded its U.S. presence in 2022 by **acquiring Terminix Global Holdings, Inc**[97](index=97&type=chunk) [Property, Plants and Equipment](index=26&type=section&id=D.%20Property%2C%20Plants%20and%20Equipment) This subsection provides a geographical breakdown of the company's 1,933 owned and leased facilities across 77 countries Number of Facilities by Region (as of Dec 31, 2023) | Region | Number of Facilities | | :--- | :--- | | North America | 707 | | Europe (incl. LATAM) | 377 | | UK and Sub-Saharan Africa | 107 | | Asia and MENAT | 687 | | Pacific | 55 | | **Total** | **1,933** | [Operating and Financial Review and Prospects](index=26&type=section&id=ITEM%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section notes the company's major R&D facilities and the opening of a new North American Innovation Centre in March 2024 - The company's major research and development facilities are located in the UK and the U.S., with a **new Rentokil Terminix North America Innovation Centre opened in March 2024**[119](index=119&type=chunk) [Directors, Senior Management and Employees](index=28&type=section&id=ITEM%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details the company's leadership, employee base, and share ownership structures Group Employees by Region | Region | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | North America | 21,965 | 21,309 | 10,316 | | Europe (incl. LATAM) | 12,959 | 11,451 | 9,386 | | UK & Sub-Saharan Africa | 5,703 | 4,889 | 7,833 | | Asia & MENAT | 19,609 | 18,457 | 16,216 | | Pacific | 2,695 | 2,486 | 2,280 | | **Total** | **62,931** | **58,592** | **46,031** | - Following a revision to the 2022 financial statements, the Remuneration Committee concluded that **no incentive compensation was erroneously awarded**, and therefore no recovery was required[163](index=163&type=chunk)[164](index=164&type=chunk) [Share Ownership](index=30&type=section&id=E.%20Share%20Ownership) This subsection provides detailed information on the shareholdings of the company's Directors and Executive Leadership Team as of March 2024 Directors' Share Interests (as of March 25, 2024) | Director | Number of ordinary shares | | :--- | :--- | | Richard Solomons | 84,900 | | Andy Ransom | 1,752,689 | | Stuart Ingall-Tombs | 195,408 | | David Frear | 8,125 | | Sally Johnson | 3,527 | | Sarosh Mistry | 1,850 | | John Pettigrew | 55,000 | | Julie Southern (as of May 10, 2023) | 9,891 | | Cathy Turner | 24,736 | | Linda Yueh | 1,590 | [Major Shareholders and Related Party Transactions](index=34&type=section&id=ITEM%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section identifies the company's major shareholders, with The Capital Group Companies, Inc holding the largest declared interest Disclosed Major Shareholdings (as of Dec 31, 2023) | Shareholder | Interest (%) | | :--- | :--- | | The Capital Group Companies, Inc. | 5.12% | | GIC Private Limited | 3.01% | | The Goldman Sachs Group, Inc. | 2.50% | [Additional Information](index=37&type=section&id=ITEM%2010.%20ADDITIONAL%20INFORMATION) This section covers material contracts, exchange controls, and taxation, including details on the Terminix acquisition financing - The acquisition of Terminix was financed in part by a **$700 million term facility** and the issuance of New Senior Notes with maturities from 2027 to 2032[187](index=187&type=chunk)[188](index=188&type=chunk)[193](index=193&type=chunk) - There are **no UK governmental laws restricting** the remittance of dividends to non-resident holders of ordinary shares or ADSs, subject to economic sanctions[199](index=199&type=chunk) [Description of Securities Other Than Equity Securities](index=47&type=section&id=ITEM%2012.%20DESCRIPTION%20OF%20SECURITIES%20OTHER%20THAN%20EQUITY%20SECURITIES) This section details the fees payable by American Depositary Share (ADS) holders and reimbursements from the depositary to the company ADS Holder Fees and Charges | Category | Associated fee or charge | | :--- | :--- | | Issuances upon deposits of shares | Up to $5.00 per 100 ADSs | | Distributions (stock or cash) | Up to $0.05 per ADS | | Exercise of rights | Up to $5.00 per 100 ADSs | | Surrendering ADSs for cancellation | Up to $5.00 per 100 ADSs | | Depositary services fee (annual) | Up to $0.05 per ADS | - The company received or is due to receive approximately **$6.45 million** from the Depositary (BNY Mellon) for the year ended December 31, 2023[250](index=250&type=chunk) PART II [Controls and Procedures](index=49&type=section&id=ITEM%2015.%20CONTROLS%20AND%20PROCEDURES) This section reports that both disclosure controls and internal controls were not effective as of year-end 2023 due to a material weakness - The CEO and CFO concluded that the company's disclosure controls and procedures were **not effective** as of December 31, 2023, due to a material weakness[256](index=256&type=chunk) - Management concluded that internal control over financial reporting was **not effective** due to a material weakness in IT general controls over user access and change management[258](index=258&type=chunk)[259](index=259&type=chunk) - The company **successfully remediated** a previously identified material weakness related to a lack of sufficient technical accounting resources[262](index=262&type=chunk)[263](index=263&type=chunk) [Corporate Governance and Other Matters](index=51&type=section&id=ITEM%2016.%20Corporate%20Governance%20and%20Other%20Matters) This part covers governance topics, including accountant fees, share repurchases, and differences between UK and NYSE governance standards Principal Accountant Fees (PricewaterhouseCoopers LLP) | Fee Type | 2023 (£ million) | 2022 (£ million) | | :--- | :--- | :--- | | Audit fees | 8 | 7 | | Audit-related fees | 3 | 2 | | Tax fees | — | — | | All other fees | — | 3 | | **Total** | **11** | **12** | - The company made **no repurchases of its own shares** during the year ended December 31, 2023, despite shareholder authorization[274](index=274&type=chunk) - As a foreign private issuer, the company follows the UK Corporate Governance Code, which has **significant differences from NYSE standards** for domestic companies[276](index=276&type=chunk)[280](index=280&type=chunk)[282](index=282&type=chunk) PART III [Financial Statements](index=58&type=section&id=ITEM%2018.%20FINANCIAL%20STATEMENTS) This section contains the audited consolidated financial statements for fiscal years 2021-2023 and the auditor's report [Report of Independent Registered Public Accounting Firm](index=59&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The auditor issued an unqualified opinion on the financial statements but an adverse opinion on internal control over financial reporting - The auditor issued an **adverse opinion** on the Group's internal control over financial reporting as of December 31, 2023, because of a material weakness in IT general controls[305](index=305&type=chunk)[306](index=306&type=chunk) - **Critical Audit Matters** identified were the impairment assessment of goodwill (£5,016 million) and the valuation of the termite damage claims provision (£260 million)[312](index=312&type=chunk)[313](index=313&type=chunk)[316](index=316&type=chunk) [Consolidated Financial Statements](index=62&type=section&id=Consolidated%20Financial%20Statements) The financial statements show significant growth in 2023, with revenue reaching £5.4 billion and profit for the year rising to £381 million Consolidated Statement of Profit or Loss Highlights (in £m) | Metric | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Revenue | 5,375 | 3,714 | 2,957 | | Operating profit | 625 | 317 | 347 | | Profit for the year | 381 | 232 | 263 | | Basic EPS (pence) | 15.14p | 11.57p | 14.16p | Consolidated Balance Sheet Highlights (in £m) | Metric | 2023 | 2022 (adjusted) | | :--- | :--- | :--- | | Total Non-current assets | 8,430 | 8,705 | | Total Current assets | 2,697 | 3,237 | | Total assets | 11,127 | 11,942 | | Total liabilities | (7,039) | (7,844) | | Total equity | 4,088 | 4,098 | Consolidated Cash Flow Highlights (in £m) | Metric | 2023 | 2022 | 2021 | | :--- | :--- | :--- | :--- | | Net cash from operating activities | 737 | 600 | 563 | | Net cash from investing activities | (416) | (1,197) | (441) | | Net cash from financing activities | (361) | 1,323 | (417) | | Net (decrease)/increase in cash | (40) | 726 | (295) | [Notes to the Consolidated Financial Statements](index=67&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes detail key accounting estimates, segment performance, business combinations, and the company's net debt position Revenue and Adjusted Operating Profit by Region (2023, in £m) | Region | Revenue | Adjusted Operating Profit | | :--- | :--- | :--- | | North America | 3,306 | 617 | | Europe (incl. LATAM) | 1,081 | 215 | | UK & Sub-Saharan Africa | 390 | 94 | | Asia & MENAT | 339 | 45 | | Pacific | 249 | 55 | - The provision for termite damage claims, a significant liability from the Terminix acquisition, stood at **£260 million** as of December 31, 2023[429](index=429&type=chunk)[431](index=431&type=chunk) - In 2023, the Group acquired **41 companies for a total consideration of £261 million**, adding £173 million in goodwill[503](index=503&type=chunk)[504](index=504&type=chunk) - As of December 31, 2023, the company's **net debt was £3,146 million**, a slight decrease from £3,279 million at year-end 2022[570](index=570&type=chunk)

Rentokil Initial plc (NYSE:RTO) Q4 2023 Earnings Conference Call March 7, 2024 5:15 AM ET Company Participants Andrew Ransom - CEO Stuart Ingall-Tombs - CFO Brad Paulsen - CEO, North America Conference Call Participants Suhasini Varanasi - Goldman Sachs James Rose - Barclays Andy Grobler - BNP Paribas Exane Ian Zaffino - Oppenheimer Nicole Manion - UBS Dominic Edridge - Deutsche Bank Allen Wells - Jefferies Chris Bamberry - Peel Hunt Andrew Ransom Good morning, ladies and gentlemen. Thank you all for joinin ...

Rentokil Initial plc (NYSE:RTO) Q2 2023 Results Conference Call July 27, 2023 4:15 AM ET Company Participants Andrew Ransom - CEO Stuart Ingall-Tombs - CFO Conference Call Participants James Rose - Barclays James Beard - Numis Andy Grobler - BNP Paribas Exane Allen Wells - Jefferies Anvesh Agrawal - Morgan Stanley Chris Bamberry - Peel Hunt Dominic Edridge - Deutsche Bank Andrew Ransom Good morning, ladies and gentlemen. Thank you all for joining us here today in person and online. In a few moments, Stuart ...

Revenue Growth - Rentokil Initial achieved a total revenue of £3,714 million at AER, reflecting a growth of 38.2%[26] - The company reported a pest control revenue of £2,516 million at CER, which is a 29.0% increase[26] - The North America segment reported a revenue of £1,675 million, up 29.7%[16] - North America revenues grew by 37.7% (at CER) and 52.0% (at AER), benefiting from 5.3% organic growth and M&A, including Terminix[127] - Group Pest Control revenues increased by 29.0% (at CER) and 38.2% (at AER), driven by resilient demand and effective price progression[127] - Revenue growth was 19.1% at constant exchange rates (CER) and 25.6% at actual exchange rates (AER), driven by strong topline momentum and M&A activities, including the Terminix transaction[160] - Organic Revenue in North America grew by 5.7%, with total Revenue up 29.7% due to the Terminix acquisition[175] Integration and Synergies - The integration of Terminix is expected to create at least $200 million in pre-tax net P&L cost synergies by the end of 2025[55] - Annual pre-tax net P&L cost synergies are expected to reach at least $200 million by the end of 2025, up from a previous estimate of $150 million[64] - The integration plan aims to reduce the number of branches from over 600 to approximately 400, enhancing route density and operational efficiency[64] - The integration process includes unifying employee terms, harmonizing IT systems, and converging go-to-market strategies, with a focus on branch and route consolidation[67] - The company aims to achieve at least $200 million in annual pre-tax net P&L cost synergies by the end of 2025 from the integration of Terminix[126] Financial Targets - Rentokil Initial has set a target for group organic revenue growth of at least 5.0% for 2023[19] - The company aims for a free cash flow conversion target of at least 90% by FY 2025[19] - The adjusted operating margin target for the group is set at approximately 19.0% by FY 2025[19] - The company has a strong record of revenue and profit growth, with a medium-term financial target of 6-9% revenue growth at constant exchange rates[81] Customer and Employee Metrics - The company has a total of approximately 4.9 million customers worldwide, including 2.9 million from Terminix[33][35] - Colleague retention remained high at 82.6%, although slightly behind 2021 levels[126] - Overall customer retention remained flat year on year at 85.4%[160] - Customer retention in Europe increased by 1.0 percentage points to 88.5%, while Asia saw a slight increase of 0.5 percentage points to 81.3%[160] Innovation and Development - The company plans to open a new science and innovation center in the US in 2023, focusing on termite and residential pest control[48] - An innovation center will be opened in the US to support residential and termite pest control operations, emphasizing sustainability and net zero carbon emissions by 2040[71] - The pipeline of innovations includes approximately 50 projects and 17 patent applications in progress, enhancing the company's competitive edge[161] - The company completed its largest training and development festival for colleagues, with over 150 sessions and more than 4,000 attendees[96][97] - The company has completed over 1.5 million pieces of U+ training and rolled out more than 500 new pieces of learning content to enhance employee development[78] Sustainability Initiatives - Rentokil Initial is committed to a 70% reduction in emissions from fumigations by 2030[51] - The company achieved a 12.5% reduction in its five-year emissions index and is on track for a 20% reduction by 2025[138] - The company is investing in air care products, including the new Aeramax Pro 3 air purifier introduced in Europe[205] - The global roll-out of Luna Dry and Luna Mini Dry products has commenced, featuring advanced brushless motor technology and HEPA 13 filters[205] - The company is extending its clean air and wellbeing portfolio into air quality monitoring with pilots conducted in Asia and Europe[205] Market Position and Strategy - Rentokil Initial is the market leader in North America for commercial, residential, and termite pest control, with expectations to grow at 1.5 times above market rates in the medium term[66] - The company plans to selectively acquire high-quality assets in other geographies and in Hygiene & Wellbeing, while slightly reducing M&A ambitions in North America due to the ongoing integration[69] - The Pest Control business, including Terminix, focuses on organic growth and acquisitions to strengthen market positions and density[208] Product Performance - The installation of PestConnect units increased by 24% in 2022, with 290,000 units now installed across 16,000 connected customer sites[127] - Sales of the Lumnia LED fly trap reached 357,000 units, with an 8% increase in sales during the year[127] - The Pest Control self-service portal is operational in 50 countries, supporting 1.2 million customer sites[204] - PestConnect has 290,000 units in operation, an increase of 30,000 units in the six months to December 2022, across 16,000 sites[204] - The Lumnia LED insect light traps are now available in over 60 countries, with a partner app being developed in collaboration with Vodafone and Google[205]

Revenue Growth - Revenue increased by £154 million, or 5.5%, to £2,957 million for the year ended 31 December 2021 from £2,803 million in 2020, driven by organic growth of £80 million and acquisitions of £184 million[107]. - North America revenue increased by £94 million, or 7.8%, to £1,291 million in 2021, aided by M&A impacts and organic growth[124]. - Europe revenue increased by £5 million, or 0.6%, to £832 million in 2021, driven by growth in Southern Europe and Latin America despite challenges from lockdowns[128]. - Revenue in Pest Control increased by £234 million, or 13.6%, to £1,952 million for the year ended 31 December 2021, driven by strong performance in North America[146]. - UK & Sub-Saharan Africa revenue rose by £32 million, or 9.7%, to £359 million, with UK operations increasing by £30 million, or 10.3%[133]. - Asia & MENAT revenue increased by £8 million, or 3.0%, to £271 million, with MENAT growing by £8 million, or 35.3%[138]. - Pacific region revenue grew by £19 million, or 10.7%, to £197 million, with Australia contributing £18 million, or 13.3%[142]. - Contract revenue across all segments increased by £130 million to £1,249 million, reflecting recovery from the pandemic[148]. Profitability - Operating profit rose by £53 million, or 17.9%, to £347 million in 2021, reflecting revenue growth across all major regions and improved net operating margins of 11.7%[118]. - Profit before income tax increased by £95 million, or 41.5%, to £325 million in 2021, supported by lower net finance costs of £30 million, a decrease of 59.2% from £72 million in 2020[119]. - Profit for the year increased by £77 million, or 41.3%, to £263 million in 2021, primarily due to the increase in profit before income tax[121]. Operating Expenses - Employee costs rose by £100 million, or 7.7%, to £1,405 million in 2021, due to an increase in the number of employees from acquisitions[110]. - Operating expenses in North America increased by £102 million, or 10.0%, to £1,125 million, driven by higher employee costs and direct materials[151]. - Operating expenses in Europe decreased by £11 million, or 1.6%, to £693 million for the year ended 31 December 2021 from £704 million in 2020, primarily due to a £8 million reduction in one-off and adjusting items[152]. - In the UK & Sub-Saharan Africa, operating expenses decreased by £6 million, or 1.8%, to £276 million for the year ended 31 December 2021 from £282 million in 2020, driven by a £11 million decrease in other operating expenses[153]. - Asia & MENAT saw operating expenses decrease by £2 million, or 0.5%, to £249 million for the year ended 31 December 2021 from £251 million in 2020, mainly due to a £10 million reduction in amortisation of intangibles[154]. - Operating expenses in the Pacific region increased by £15 million, or 10.3%, to £162 million for the year ended 31 December 2021 from £147 million in 2020, largely due to a £11 million rise in employee costs[155]. - Pest Control segment's operating expenses increased by £141 million, or 9.2%, to £1,676 million for the year ended 31 December 2021 from £1,535 million in 2020, with employee costs rising by £90 million[156]. - Hygiene & Wellbeing segment's operating expenses decreased by £38 million, or 5.5%, to £658 million for the year ended 31 December 2021 from £696 million in 2020, primarily due to a £15 million decrease in direct materials and services[157]. Cash Flow - Net cash inflows from operating activities increased by £15 million, or 2.7%, to £563 million for the year ended 31 December 2021 from £548 million in 2020, driven by a £53 million increase in operating profit[161]. - Net cash outflows from investing activities decreased by £56 million, or 11.3%, to £441 million for the year ended 31 December 2021 from £497 million in 2020, mainly due to a £341 million change in net investment in term deposits[163]. - Net cash flows from financing activities decreased by £646 million to a £417 million outflow for the year ended 31 December 2021 from a £229 million inflow in 2020, primarily due to a £1,685 million decrease in proceeds from new debt[164]. Other Financial Information - The company experienced a release of £20 million in revenue provisions and £12 million in bad debt provisions during 2021, reflecting recovery from the COVID-19 pandemic[118]. - Temporary customer suspensions peaked at 7.9% in August 2021 but fell to 2.8% by December 2021, indicating improving market conditions[141]. - One-off and adjusting items increased by £13 million, or 168.8%, to £21 million in 2021, primarily due to fees related to the Terminix transaction[116]. - The company experienced a £1 million adverse effect from foreign exchange movements, but organic revenue growth was strong across multiple regions[134]. ADR Program and Fees - The Company received approximately $950,000 in the year ended December 31, 2022, from fees related to dividends paid and contributions to the ADR program costs[279]. - The Depositary charges up to $5.00 per 100 ADSs for issuing upon deposits of shares[278]. - The fee for distributing cash dividends or other cash distributions is up to $0.05 per ADS[278]. - The exercise of rights to purchase additional ADSs incurs a fee of up to $5.00 per 100 ADSs[278]. - The fee for surrendering ADSs for cancellation and withdrawal is also up to $5.00 per 100 ADSs[278]. - General depositary services fee is up to $0.05 per ADS per calendar year[278]. - The Depositary reimburses the Company for certain expenses related to the ADR program, including mailing financial reports and distributing dividend checks[279]. - The Company has limits on the amount of expenses for which the Depositary will reimburse, but this is not tied to the fees collected from investors[279]. - The Depositary's fees and expenses include taxes, registration of shares, and currency conversion costs[278]. - The Company’s ADR program is administered by The Bank of New York Mellon[276].

Terminix Global Holdings, Inc. (TMX) Q1 2022 Earnings Conference Call May 5, 2022 4:30 PM ET Company Participants Jesse Jenkins - VP, IR, FP&A & Treasurer Brett Ponton - CEO Bob Riesbeck - EVP & CFO Conference Call Participants Tim Mulrooney - William Blair Ashish Sabadra - RBC Capital Markets George Tong - Goldman Sachs Brian Butler - Stifel Operator Ladies and gentlemen, welcome to the Terminix First Quarter 2022 Earnings Call. Today's call is being recorded and broadcast on the Internet. Beginning today' ...

** ************************ ++++++++++++++++++++++ + * +++++++++++++++++++ + + | ® Fourth-Quarter and Full-Year 2021 Earnings Webcast March 1, 2022 Cautionary Statements Safe Harbor Statements Information Regarding Forward-Looking Statements, Additional Information About The Proposed Rentokil Transaction And Where To Find It, and Information for Participants in the Solicitation of Proxies can be found in the appendix of this presentation. Note to Non-GAAP Financial Measures This presentation contains certai ...

Terminix Global Holdings, Inc. (TMX) Q4 2021 Earnings Conference Call March 1, 2022 9:00 AM ET Company Participants Jesse Jenkins - Vice President, Investor Relations, FP&A & Treasurer Brett Ponton - Chief Executive Officer Bob Riesbeck - Executive Vice President & Chief Financial Officer Conference Call Participants Tim Mulrooney - William Blair Ian Zaffino - Oppenheimer Mario Cortellacci - Jefferies Andy Wittmann - Baird Brian Butler - Stifel George Tong - Goldman Sachs Operator Ladies and gentlemen, welc ...

Terminix Global Holdings, Inc. (TMX) Q3 2021 Earnings Conference Call November 2, 2021 9:00 AM ET Company Participants Jesse Jenkins - VP, IR Brett Ponton - CEO Bob Riesbeck - CFO Conference Call Participants Tim Mulrooney - William Blair Ashish Sabadra - RBC Capital Markets Ian Zaffino - Oppenheimer Gary Bisbee - Bank of America Securities Mario Cortellacci - Jefferies Toni Kaplan - Morgan Stanley Andy Wittmann - Baird George Tong - Goldman Sachs Operator Ladies and gentlemen, welcome to the Terminix Third ...

十十十十十十十十十十十十十十十十十十十 ++ + + ******************** + + + + TRANK | ® Second-Quarter 2021 Earnings Webcast August 5, 2021 Cautionary Statements Safe Harbor Statement This presentation contains forward-looking statements and cautionary statements, including cash flow outlook and projections, that are based on management's beliefs and assumptions and on information currently available to management. Most forward-looking statements contain words that identify them as forward-looking, such as "anticipates," "believ ...