Regus office news 5th March 2014

Regus, the world’s largest serviced offices group, has reported record growth in its full year results thanks in part to its acquisition during the period of its largest UK rival MWB and said it is planning to open another 300 centres in 2014.



The group said group revenue increased 23.3% to £1,533.5m in the full-year to 31 December. Operating profit was up 1% to £90.8m “notwithstanding the impact of £301.1m investment in growth and £7.4m of MWB transaction and restructuring costs”.



Regus said it had a firm control of its cost base with overheads on a per available workstation basis reduced by 3.8%. Net debt at 31 December 2013 stood at £57.2m reflecting “significant investment in growth and its impact on operating profit”.



Regus said there would be a 14% increase in final dividend to 2.5p (2012: 2.2p), a full year increase of 13% reflecting strong mature performance. Revenue per occupied workstation (REVPOW) – a key figure for the serviced office sector - increased to £7,750, an improvement of 4.3% or £321. Regus said there had also been continued strong occupancy across its mature portfolio of 83.8% (2012: 84.5%).



Regus said there had been record growth with a continuing significant investment to increase national networks. The period saw £301.1m invested in growth with 448 new centres added and the network increased to 1,831 business centre locations. New 2012 and 2013 centres were performing in-line with expectations while there was a 17% annual increase in membership to 1.58m.



Regus said MWB was fully integrated and on track to add at least £15m to Group operating profit in 2014 Regus said that in 2014 it anticipated opening at least 300 centres as well as the addition of more third place locations. Mark Dixon, chief executive of Regus, said: "It's been another record year of achievement for Regus, with strong progress made across all parts of the business.



Group revenue was up 23%, following a 30% increase in the size of our global network to 1,831 business centre locations, an unprecedented rate of growth and investment, which included the successful integration of MWB. “Our Mature business remains the engine room of the Group and it delivered operating profits in excess of £205m, a 33% increase, alongside free cash flow of £157m.



This strong performance from our mature business allowed us to reinvest in growth, so ensuring the incremental returns of the future. “At this early point in the year it is always somewhat difficult to predict precisely how many locations we will add, but we expect at least 300 new business centre locations as well as the addition of more third place locations.



"Current trading is good, although the strengthening of sterling in recent months will affect the translation of our results. Notwithstanding this, we remain confident in our business model and our prospects for the year ahead."