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Intertek posts revenue, profit below view; shares plunge

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(Reuters) – Intertek Group shares <ITRK.L> slumped 6.2 percent on Tuesday after the British testing company’s first-half profit and revenue fell short of some analysts’ estimates as it faced tough conditions in the oil and gas infrastructure market.

Organic revenue grew 3.4 percent, at constant currencies, in the six months to June 30, compared with a 1.7 percent rise last year.

However, RBC analysts said this implied a slowdown to an about 2.2 percent growth in the last two months, compared with a 4 percent growth rate in the first four months.

Jefferies said the 2.2 percent growth missed its estimate for a 3.2 percent rise for those two months.

The company’s half-year organic revenue growth was also behind Barclays’ 4.1 percent forecast.

The company, which carries out safety tests on trains, toys as well on equipments for the oil and mining sector, had benefited earlier this year from expanding regulations, notably for food safety and e-commerce.

Adjusted operating profit from the resources business, which contributes less than 6 percent of the company’s total, fell 7.3 percent in the first half, which the company attributed to cyclical challenges.

Total adjusted operating profit rose less than 1 percent to 225.8 million pounds in the first six months, but was below RBC analysts’ estimate of 236.2 million pounds.

Half-year adjusted operating margins rose 40 basis points to 16.8 percent, the company said.

Revenue fell 1.8 percent to 1.35 billion pounds, also below RBC’s 1.39 billion pounds estimate.

(Reporting by Arathy S Nair in Bengaluru; Editing by Amrutha Gayathri)

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