- Brad Paulsen became head of Rentokil’s North American arm in December 2023
- Activist hedge fund Trian Partners has reportedly pushed for Paulsen to quit
The chief executive of Rentokil Initial’s North America operations has left the firm after just over a year, following a turbulent period for the business.
Brad Paulsen joined the pest control giant as head of its North America segment in December 2023 after a short stint running electrical supplier Rexel USA.
This followed difficult trading conditions for the Crawley-based firm in the US, where it has suffered weaker demand from wholesale clients like pest control operators and landscaping businesses.
Rentokil issued a profit warning last September owing to a weaker-than-anticipated performance over the summer in North America, where it faces tough competition from rival Rollins.
The company also said organic growth had been disrupted by the merging of branches of Terminix, a pest control provider it bought four years ago for £5.1billion.
Activist hedge fund Trian Partners, which recently bought 7.5m Rentokil shares, had reportedly pushed for Paulsen to quit, along with chief financial officer Stuart Ingall-Tombs.
Outlook: Rentokil issued a profit warning last September owing to a weaker-than-anticipated performance over the summer in North America
Rentokil said Paulsen will leave this April to ‘pursue a new opportunity’ at an unnamed publicly-traded building materials firm in the US.
A graduate of West Point Military Academy, Paulsen’s corporate career has seen him work for retailers like Toys ‘R’ Us and Home Depot, as well as industrial distributor HD Supply.
Rentokil revealed that its chief commercial officer, Alain Moffroid, will take interim charge of the North American segment.
It called Moffroid, who initially joined the group in 2013 from consumer goods giant Unilever, ‘a highly experienced leader in the company with extensive experience of both residential and commercial pest control’.
Rentokil also announced that its full-year operating margin and pre-tax profits on an adjusted basis were in line with guidance.
For the fourth quarter of 2024, Rentokil’s organic revenues increased by 2.3 per cent, an improvement on the 1.4 per cent rise of the previous three months.
Sales at its North American pest control services segment ticked up by 1.5 per cent, which the company credited to ‘improved momentum in inbound lead flow from our marketing initiatives’.
Russ Mould, investment director at AJ Bell, said: ‘After a torrid time for Rentokil, investors will be relieved about its in-line trading update and increase in organic growth across the Atlantic.
‘Rentokil operates in an industry which should be relatively unaffected by the ups and downs of the economy, but it has not delivered the kind of steady performance investors would hope for.
‘Chief executive Andy Ransom has been in place for well over a decade and will be under pressure to show the recent improvement in fortunes is not just a flash in the pan.’
Rentokil Initial shares rose 2.95 per cent to 398.3p on late Tuesday morning, making them one of the FTSE 100 Index’s top performers.
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