Rentokil approves $200 million share buyback as shares rise 7.2%
Key Facts
Rentokil Initial approved a $200 million share buyback programme as third-quarter revenue rose and North American pest control services improved, according to its trading update released on 22 October 2026. Group revenue reached $1,890 million, compared with $1,810 million in the third quarter of 2025. Reported revenue growth was 4.4%, while growth at constant exchange rates was 4.0%. Group organic growth was 3.4% during the period, according to the company statement. Reuters reported that the shares rose 7.2% during trading in its report published on the day of the update. The company kept its annual profit outlook in line with market expectations.
In North America, pest control services posted organic growth of 2.4% in the third quarter, supported by residential business and improvements in large commercial accounts, the company said. Supporting factors also included improved service quality and increased adoption of the "PestConnect" system. Pest control contract revenue in the region grew 3.1% at constant exchange rates. The update described this performance as "contract revenue growth of 3.1%". In the residential business, the decline in lead flow narrowed to about 1% in September. This improvement followed weak lead flow in July and August, according to the trading update.
International pest control operations posted organic growth of 5.7% in the third quarter, outpacing growth in North American pest control services. Rentokil said India and Indonesia led volume growth across its operations in Asia, the Middle East, North Africa and Turkey. In Britain, core pest control revenue rose organically by 9.2% over the same period. The company attributed the British performance to pricing and improved customer retention. Alongside this operating performance, the group divested a small business in Jordan during the quarter as part of efforts to simplify its portfolio.
On acquisitions, Rentokil completed 21 bolt-on deals from the start of the year through the end of September 2026, according to its quarterly update. The company lowered its estimate for acquisition spending during the year to about $100 million. It had expected to spend about $120 million when it announced its half-year results in July. Those results showed free cash flow rising to $318 million in the first half of 2026, compared with $282 million in the corresponding period of 2025. Free cash flow increased by 12.8%, according to the half-year results statement. At the end of June 2026, the ratio of net debt to adjusted earnings before interest, taxes, depreciation and amortisation fell to 2.4 times, compared with 2.8 times at the end of June 2025.
As part of its portfolio reshaping, Rentokil had announced on 22 September 2026 an agreement to sell SOLitude Lake Management and its Vertex Aquatic Solutions unit to Bain Capital. The company set the transaction consideration at $230 million on a cash-free, debt-free basis. It estimated expected net cash proceeds after tax at about $180 million. The agreement announcement stipulated that the transaction was subject to U.S. antitrust clearance under the Hart-Scott-Rodino Act. The October update continued to forecast completion during the fourth quarter of 2026.
Rentokil also announced that Chief Financial Officer Paul Edgecliffe-Johnson would retire from his executive role and the board effective 31 January 2027 for family health reasons. The company said he would continue as a senior adviser, while the board had begun searching for a successor. Sarah Sergeant will serve as interim chief financial officer from 1 February 2027 if a permanent successor has not started by the current finance chief's retirement. On the share buyback programme, the group said it would begin shortly, with completion expected by the announcement of its annual results. The financial calendar set the preliminary annual results announcement for 25 February 2027, followed by the first-quarter trading update on 22 April 2027.