Berendsen laundry sales shrink in heat of currency markets

Full year results from laundry services group Berendsen were ill-received by the market after sales were hit by the strength of sterling, even though earnings still delivered growth.

Management said they expected currency impact to persist but expect to achieve a further year of good underlying progress in 2015.

The FTSE 250 group saw sales shrink 2% to £1.04bn, though they rose 3% at the underlying level.

A 40 basis-point gain in operating profit margins led to a 6% gain in operating profits to £158.7m, with pre-tax profits up 2% to £138.5p.

Despite the strength of sterling, adjusted earnings per share rose 4% to 62.1p and, with 116% of adjusted profit after tax converted to free cash flow, the board lifted the full year dividend 7% to 30p.

Chairman Iain Ferguson said the good operational performance reflected continued momentum towards achieving management's strategic objectives.

In the latter part of 2014, a strategy review outlined the scope for further outsourcing potential in the market.

"We firmly believe that there is still a great deal of opportunity for the group to continue to grow and drive efficiencies in its existing markets and in its current business lines."