Company: RKLIF
Filing Date: 2025-03-06
Form Type: 6-K
Source: 0001654954-25-002335
Chunk: 9

Company: RENTOKIL INITIAL PLC /FI
Filing Date: 2025-03-06
Form: 6-K
Chunk 9
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 a national focus for the Rentokil and Terminix brands. However, there will be an additional focus on our well-known regional brands, rather than merging them over time with Terminix, giving us 9 regional core brands. Smaller local brands will be co-branded or merged. This will allow us to optimise the return opportunity we generate from our advertising spend and increase the overall share of voice of our brands.

Optimising Branch strategy:In Q4 2024 we commenced the piloting of satellite branches. Ten sites in key metro areas were active as at the end of 2024, and we currently have 22 in operation. These smaller branches are fully branded and operational but have a low cost to operate. They serve as localised hubs with active facilities, staffed with sales, administrative, and customer support teams.

While the pilot is still not complete, initial findings are positive, driving digital leads and being recognised by search engines as local points of presence that increase our digital footprint. Subject to continued progress with this pilot, we believe a branch network combining larger, traditional sites and smaller satellites will serve us well. Based on our current branch network and mapping of an optimal footprint for lead generation, we currently estimate that by the end of 2026 we will have a network of over 500 branches, including satellite branches, versus our previous target of 400. In addition, we have over 100 franchised owned and operated Terminix branches in the US.

A portion of current investment deployed during 2024 but not driving optimal effectiveness and efficiency will be redirected to our enlarged brand and branch strategies.

Cost savings and margin opportunity

We continued to achieve cost synergies in 2024, whilst also continuing our significant investments behind salary and benefit harmonisation, safety, innovation and IT, and we saw another year of inflation in the cost base.

During 2024 we made significant in-year sales and marketing investments focused on driving revenue, including behind brand awareness, lead generation and sales infrastructure. A portion of the investment behind these opportunities is not driving optimal effectiveness and efficiency and in 2025 will be redirected to fund the new strategies we will be deploying in respect of our enhanced brand strategy and our enlarged branch strategy.

During 2025 we expect further inflation but do not anticipate the need for additional investments over those which were made in 2024.

Three years post the acquisition announcement of Terminix, and going forward we will not report separately on net synergy delivery. Disaggregating investments and inflationary cost increases from synerg