June 25, 2020 / 6:33 AM / 11 days ago

Outsourcer Mitie buys rival Interserve's facilities arm

June 25 (Reuters) - Mitie Group said on Thursday it would buy rival Interserve’s facilities management arm for 271 million pounds ($336.64 million), using its financial muscle to gain scale in Britain’s huge outsourcing industry at a time when others are struggling with the coronavirus fallout.

In results published along with the announcement, Mitie said its operations have been less affected by Britain’s lockdown than initially feared, with revenue in April and May down just 12%.

The company, which cancelled its final dividend for the year in a bid to save cash to sail through the coronavirus crisis, said businesses are cutting down on discretionary spending as the pandemic unravels.

Underlying operating profit, or earnings before interest and tax (EBIT), of 86.1 million pounds for the 12 months ended March 31 was above analysts’ estimate of 82.8 million pounds.

$1 = 0.8050 pounds Reporting by Pushkala Aripaka in Bengaluru, Editing by Sherry Jacob-Phillips

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