Mitie buoyed by new contracts but boss warns Middle East conflict could drive costs up
Facilities management group Mitie enjoyed double-digit revenue growth in the year to 31 March.
The outsourcing giant said sales were buoyed by new contracts and acquisitions, as well as a disciplined approach to costs.
Chief executive Phil Bentley said it had seen ‘progression’ in profit margins to allow the firm to invest, but flagged ‘the potential for some incremental cost inflation as a result of the conflict in the Middle East’.
Annual revenue rose 10.5 per cent to £5.62billion year-on-year, including 5.3 per cent from organic growth, largely linked to new contracts, and 5.2 per cent from acquisitions.
The company booked an annual pre-tax profit of £123.7million for the period, down 15 per cent from £145.4million the previous year.
The company’s share price has risen by more than 11 per cent in the past year and was up 2.38 per cent or 4.14p to 178.04p
Share buyback: Mitie unveiled a fresh £100m buyback programme on Thursday
Mitie said it made £25million worth of cost savings in the period.
It said the cost savings ‘more than offset material cost headwinds, including from inflation, additional employer National Insurance Contributions (NIC), unsuccessful contract renewals and other one-off costs.’
The group said it had a ‘record’ total order book in the period, rising 6 per cent to £16.3billion year-on-year. Its order pipeline jumped 34 per cent to £31.7billion, against £23.7billion a year ago.
Restructuring costs rose to £27.2million from £16.6million, while acquisition and disposal costs increased to £74.9million from £43.1million the previous year.
The FTSE 250-listed company, which has more than 80,000 staff, saw a 12 per cent rise in revenue from security services to £580million in the six months to the end of September, fueled by a number of new contract wins including with chemist Boots and supermarket chain Co-op.
An upturn in the firm’s security services performance has emerged alongside a rise in shoplifting across Britain.
Notable contract wins also included security and hygiene services for insurance giant Aviva, alongside contracts with the Home Office, Metropolitan Police Authority, Tate Gallery and Decathlon.
Rising demand for data centres has also helped bolster Mitie’s turnover.
The firm’s board has recommended a final dividend of 3.1p per share, bringing the total dividend up 5 per cent to 4.5p per share, up from 4.3p a year ago.
Mitie unveiled a fresh £100million buyback programme for financial 2027, including the remaining £40million of the £100million programme launched in October 2025, of which £60million has already been completed.
Bentley said on Thursday: ‘Looking ahead, we enter full-year 2027 with good momentum, supported by a record order book and bidding pipeline.’
Bentley said that after almost a decade as chief executive, it remained his intention to retire from Mitie at the end of the current three-year FY25-27 plan when he will be 68. He said the process to find his successor was ‘well underway’.
Mark Crouch, a market analyst at eToro, said: ‘Mitie has turned in a performance that should give investors plenty to cheer about, with double-digit growth in revenue, operating profit and free cash flow demonstrating that Britain’s leading facilities services provider continues to build scale, deepen customer relationships and convert growth into cash.’
He added: ‘For investors, the combination of growing profits, strong cash generation, rising dividends and a further £100million share buyback sends a clear signal of confidence. The market often rewards visibility and execution, and Mitie currently appears to have both in abundance.’
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