Rentokil, the world's largest pest-control company, reported a 79 per cent plunge in first-quarter profit and said it will cut dividends for the first time in at least 19 years.
Pretax profit dropped to £5 million ($9.9 million) from £23.6 million a year earlier, London-based Rentokil said today in a statement.
Revenue rose 12 per cent to £578.1 million, beating a Citigroup forecast of £531.7 million.
Rentokil ousted its chief executive and chairman and hired a trio of Imperial Chemical Industries managers to stem a four-year profit slide.
City Link, once Rentokil's fastest growing unit, will likely post a "significant" loss this year after struggling to integrate purchases.
Alan Brown, who became CEO in March, said Rentokil's dividend policy is "way out of line" and 2008's payout will be slashed by a "substantial" amount.
"We have struggled to implement major change programs, which has affected our ability to turn top line growth into profit," Mr Brown said. Returning City Link to "former levels of profitability is likely to take some time."
Rentokil was little changed in London trading and was trading at 94.5 pence as of 8.06am. The stock has gained 29 per cent in London trading since Brown's appointment on March 20th.
He was formerly finance chief at ICI. John McAdam, the chemical maker's former CEO, became chairman. The advance values Rentokil at £1.7 billion.
Bloomberg