*Cleanzine-logo-8a.jpgCleanzine: your weekly cleaning and hygiene industry newsletter 11th July 2024 Issue no. 1122

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ISS updates divestment program

* ISS-updates-Divestment-Programme.jpgISS has this week announced an update of its divestment program and divestments of its Hong Kong-based waste handling business unit as well as ISS Taiwan. The Hong Kong business unit generated approximately 0.2% of Group revenue.

With the transactions, accumulated net proceeds of the divestment program now amounts to DKK 1.8 billion compared to the total target for 2021 and 2022 of around DKK 2.0 billion.

The program is thereby nearing its completion, and ISS is updating its scope. The ongoing execution of the OneISS strategy and the business development of certain assets has led to a reduction of the assets in scope. This relates to ISS Chile and a few selected business units where ownership has been reassessed to be value-adding in IFS bids and contracts. Total net proceeds are still expected to be around DKK 2.0 billion.

As a consequence, ISS Chile will be reclassified back to continuing operations and will from 2021 be reported as part of the Americas region. ISS Chile has developed positively during 2021 and has won key account contracts making the strategic fit to the global business more relevant and better aligned to the OneISS strategy. In 2021, ISS Chile generated revenue of around DKK 1 billion.

The three outstanding countries (Brunei, Portugal and Russia) continue to be reported under discontinued operations until divestment, expectedly in 2022. Furthermore, the number of business units under the program has also been reduced and now only comprise two smaller business units generating annual revenue of approximately DKK 150 million.

The changes to the program will positively impact Group revenue from continued operations by approximately DKK 1 billion in 2021 and have a neutral effect on the operating margin (reclassification from Discontinued Operations). The Group outlook for organic growth, operating margin and free cash flow is not impacted and remains unchanged.

"The continued strong execution of the divestment program is important for our strategy execution,” explains Group CEO Jacob Aarup-Andersen. “As we are reaching the conclusion of the programme, we are gradually able to refocus the business from rightsizing our footprint towards our important commercial and sustainability priorities."


10th February 2022

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