Company: RKLIF
Filing Date: 2025-07-31
Form Type: 6-K
Source: 0001654954-25-008672
Chunk: 25

Company: RENTOKIL INITIAL PLC /FI
Filing Date: 2025-07-31
Form: 6-K
Chunk 25
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 increase/decrease the provision by c.$8m (2024: $8m). Over the 6    
 months to 30 June 2025, costs per litigated claim rose by c.18%     
 (2024: 8%) and non-litigated costs rose by 13% (2024: 45%). Actual  
 value of claims settled in the period to June 2025 has been at a    
 combined cost per claim 9% higher than that seen throughout 2024.   
 This is not representative of management's expectation of future    
 costs as ageing of claims, which drives an increased cost per       
 claim, has reduced in recent months and is expected to continue to  
 improve.                                                            |
| ● | Claim rate - Management has estimated claim rates based on          
 statistical historical incurred claims. Data has been captured, to  
 establish incidence curves that can be used to estimate likely      
 future cash outflows. Changes in rates of claim are largely outside 
 the Group's control and may depend on litigation trends within the  
 US, and other external factors such as how often customers move     
 property and how well they maintain those properties. This causes   
 estimation uncertainty that could lead to material changes in       
 provision measurement. Management has modelled that an              
 increase/decrease of 5% in litigated claim rates would              
 increase/decrease the provision by c.$5m (2024: $4m) and an         
 increase/decrease of 5% in non-litigated claim rates would          
 increase/decrease the provision by c.$8m (2024: $8m) accordingly.   
 Over the 6 months to 30 June 2025,the assumption for litigated      
 claim rates rose by 43% (2024: fell 52%) and non-litigated claim    
 rates fell by 5% (2024: rose 7%).                                   |
| ● | Customer churn rate - If customers choose not to renew their        
 contracts each year, then the assurance warranty falls away. As     
 such there is sensitivity to the assumption on how any customers    
 will churn out of the portfolio of customers each year. Data has    
 been captured and analysed to establish incidence curves for        
 customer churn, and forward-looking assumptions have been made      
 based on these curves. Changes in churn rates are subject to        
 macroeconomic factors and to the performance of the Group. A 1%     
 movement in customer churn rates, up or down, would change the      
 provision by c.$13m up or down (