Rentokil saw its profits drop by nearly a third amid a series of one-off costs, despite its hygiene business booming during the pandemic.
The pest control company said it had spent millions on acquisitions and integrations, settled some old payrolls in France, and taken a £2.9 million charge for disposing of faulty personal protective equipment.
Pre-tax profit dropped 32% to £229.8 million on revenue of £2.8 billion, up 4%, Rentokil said.
With adjustments to strip out one-off costs, pre-tax profit rose 4.2% to £355.2 million.
Chief executive Andy Ransom hailed the hygiene business, which saw revenue boom by 36.8% last year.
It launched disinfection services across the world in response to the Covid-19 pandemic in the second quarter of last year, selling deep cleans to businesses. Disinfection brought in £225.1 million in revenue.
Thanks to the significant and swift actions we took in 2020, we are strongly positioned for the coming yearAndy Ransom, Rentokil
Mr Ransom said: “The medium-term prospects for our hygiene business have never looked more promising as the demand for global hygiene services is sustained post the pandemic.”
However, he warned that the good times for the disinfectant business are unlikely to continue in the long term.
“We will continue to provide disinfection services as part of the crisis response, but expect volumes and prices to significantly unwind as the year progresses and the crisis hopefully abates,” he said.
However, when stripping out the disinfection unit, ongoing revenue dropped by 4.6% in the hygiene business.
Pest control revenues grew by 1% across the year, as the unit was deemed an essential service.
The company passed its 1.5 billion dollar (£1.07 billion) revenue target in North America by nearly 6%.
Mr Ransom said there is still uncertainty around the pandemic, but Rentokil is confident it can deliver progress this year.
“2021 will be a year of transition as we cross the bridge from the worst of the crisis in 2020 to, hopefully, a post-pandemic 2022,” he said.
“Thanks to the significant and swift actions we took in 2020, we are strongly positioned for the coming year, and expect to see further progress from our core pest control, hygiene, and protect and enhance categories.”
Rentokil acquired 23 businesses last year, overwhelmingly in pest control, for around £202 million. It plans to double that spend this year.
The acquisitions included businesses in Chile, Spain, Tanzania and the US. It also entered Peru and Ghana for the first time.
Shares fell 2% on Thursday morning after the announcement.