The full facility management giant, ISS has announced showing that revenue increased by 6.3% in the first nine months of 2019 and 8.9% in Q3 (Q2 2019: 5.0%).
There was organic growth of 6.8% in the first nine months of 2019, and 8.4% in Q3 (Q2 2019: 5.8%) was driven by the launch of the Deutsche Telekom contract, strong commercial momentum with a high level of key account contract wins, extensions and expansions as well as projects and above-base work.
Organic growth from key accounts was 9.7% in the first nine months of 2019 and 12.9% in Q3, representing 62% of Group revenue (H1 2019: 61%).
Jeff Gravenhorst, Group CEO, ISS A/S, said, “Our organic growth of 6.8% in the first nine months of 2019 was underpinned by our strengthening key account focus. However, the need to reduce our 2019 outlook for both operating margin and cash flow is clearly disappointing.
'Our execution has proven unsatisfactory in a few areas leading to an operational shortfall, hereby triggering some negative one-off items impacting 2019. Our strategic choices are right, but our level of ambition and our desired pace of change, in hindsight, have proven too ambitious.
'We have overstretched ourselves. This will change. We will take an additional 12 months to complete our investment programme and we will launch an efficiency plan. This will reduce both risk and cost.
'Whilst margin and cash flow expectations for 2019 are now significantly reduced, we expect a strong recovery in 2020. Our medium-term outlook is delayed by 12 months, but otherwise unchanged.”