Intertek Group (ITRK) H2 2024 earnings summary

Executive summary

• Delivered strong 2024 results with earnings and margins ahead of expectations, marking the fourth consecutive year of mid-single digit like-for-like revenue growth.

• Operating margin increased by 100 basis points to 17.4%, and EPS grew 15.2% at constant currency.

• ROIC reached 22.4%, up 250 basis points, and full-year dividend increased by 40.1% to 156.5p.

• Announced a GBP 350 million share buyback and raised medium-term margin targets to 18.5%+.

• Record adjusted free cash flow and significant value growth opportunities in high-growth, high-margin sectors.

Financial highlights

• Group revenue up 6.6% at constant currency to GBP 3.4 billion; like-for-like revenue growth of 6.3%.

• Operating profit up 13% at constant rates to GBP 590 million; operating margin at 17.4%.

• Adjusted free cash flow reached a record GBP 409 million; net debt reduced to GBP 500 million; net debt to EBITDA ratio improved to 0.7.

• Dividend increased 40.1% to 156.5p.

• Six acquisitions in five years delivered a 25.1% aggregate margin in 2024.

Outlook and guidance

• Expect robust financial performance in 2025 with mid-single digit like-for-like revenue growth across most divisions.

• High single digit like-for-like growth expected in Corporate Assurance.

• Targeting further margin progression and medium-term operating margin of 18.5%+.

• CapEx investment guidance for 2025 is GBP 135-145 million; net debt expected between GBP 470-520 million.