Healthcare Pest Control Services Sector

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Healthcare Pest Control Services Sector

The revenue generated by the pest control businesses for the top five companies in the US are as follows: Anticimex ($101.94 million), Ecolab ($465 million), Rentokil Initial ($1,043 million), Rollins ($1,677.1 million), and Terminix ($1,622 million).


Anticimex

  • Anticimex is a global leader in pest control services with operations in 18 countries and 6,100 employees.
  • In 2018, the company generated annual revenue of SEK 6,494 million ($687.56 million), of which 80% of the total revenue was generated by the pest control businesses across the world.
  • The annual revenue generated by the US pest control operations in 2018 stood at SEK 963 million (101.94 million); this was confirmed by the company's recent annual report stating that 100% of the revenues generated in North America comprised pest control business operations in the US only.
  • Anticimex generates about 68% of its revenue from the commercial segment, while the residential segment contributes about 32% to the total revenue.
  • In 2018, about 15% of the company's total revenue was generated from the US pest control services; also, the country's revenue nearly doubled in 2018, from SEK 410 million to SEK 963 million, registering a growth of about 140%.
  • The company's strategy for growth in the US includes the acquisition of well-established companies that offer high-quality pest control services.


Rentokil Initial

  • Rentokil Initial is a global service provider of route-based service. The company's core services include pest control and hygiene. Additionally, the company also provides specialist services like plants, property care, and workwear.
  • Rentokil operates across 75 countries with a team of over 39,500 people in 2018.
  • The total revenue generated by the company in 2018 was £2,493 million ($3,176 million). The revenue break-down according to business segment — Pest Control — 63% or £1,571.9 million; Hygiene Services — 22% or £536.7 million; Protect & Enhance Services — 15% or £384.4 million.
  • According to the company's recent annual report about 38% ($1,206 million) of the global sales are generated from the North American market; further, the report states that the US comprise 95% ($1,146 million) of the North American market, followed by Canada at 4%, and Central America at 1%.
  • In 2018, the share of revenue generated from the pest control services in North America was 91%; hence, the revenue generated by the US pest control services for the company in 2018 stood at $1,043 million.
  • In 2018, Rentokil Initial acquired 14 US-based pest control companies to secure its coverage across 90% of the US population.


Terminix

  • Established in 1927, Terminix is a leading provider of residential and commercial pest and termite control services in the US.
  • The company's annual revenue for 2018 stood at $1,655 million ; of which the US operations generated 98% ($1,622 million) of the revenue, and only 2% ($33 million) of the revenue was generated from businesses across Canada, Mexico, the Caribbean, Central America, India, Japan, South Korea, and the Middle East.
  • In 2018, about 59% of the company's revenue was generated from pest control services, followed by 36% from termite and home services, and about 5% from the distribution of pest control products.
  • The break-down of pest control revenues for the company operations in the US is as follows — Residential Pest Control-$655 million; Commercial Pest Control-$317 million; Termite and Home Services-$599 million; and Other-$84 million.
  • In 2018, Terminix's pest control services revenue was driven by 67% residential services and 33% commercial services. Further, about 80% of the company revenue comes from customers who renew the contracts annually.
  • As of 2018, the company operates across 47 states in the US with about 310 company-owned locations and over 100 franchise-owned locations.
  • Terminix serves over 2.8 million customers in the US, with a workforce of more than 9,600 employees, visiting an average of 50,000 customers daily.

Rollins

  • The company only operates in the segment of pest and termite control business.
  • Rollins primarily operates in the United States, with additional operations across Canada, Mexico, the Caribbean, Australia, Central America, the Middle East, Asia, Europe, and Africa.
  • In 2018, the total global revenue generated by the company stood at $1,821.6 million. Whereas, the revenue generated from the US operations were $1,677.1 million or 92.07% of the global revenue.
  • The break-up of revenue for the company's pest control services is as follows — Residential services: $773.93 million (42%); Commercial services: $707.38 million (39%); Termite completions and bait monitoring services: $332.57 million; and revenue from other services: $7.67 million.
  • Rollins acquired 38 companies in 2018 and has a workforce of nearly 14,000 employees.

Ecolab

  • Ecolab is a global leader in water, hygiene, energy technologies, and pest control services. The company operates across 170 countries with a team of over 49,000 associates.
  • The company generated a total sales of $14.66 billion in 2018, of which about 58% was contributed by the North American Market and about 53% or $7.76 billion is contributed by the United States alone.
  • The company's revenue generated according to the business segment include — Global Industrial services-36% or $5.27 billion; Global Institutional services-35% or $5.13 billion; Global Energy services-23% or $3.37 billion; and Other services (Pest Control)-6% or $879 million.
  • Ecolab's revenue generated from the pest control operations in the US is calculated to be $465 million for the company. [Total revenue ($14.66 billion) x Revenue contribution by pest control (6%) x Revenue contribution by the US (53%) = $465 million]

HELPFUL INSIGHTS

  • The global pest control market is valued at $18 billion, of which the North American market contributes about 50% or $12 billion to the global market.
  • Additionally, the top 4 companies — Terminix, Rollins, Rentokil, & Ecolab generate over 30% or $3.6 billion of the total US pest control industry revenues.
  • There are over 40,000 pest control service providers globally, of which about 50% or 20,000 companies are based in the US.
  • The US pest control services market comprise 70% of residential customers and 30% commercial customers.
Sources
Sources

Quotes
  • "The North American pest control market is valued at SEK 90 billion, i.e. half of the global market. Meanwhile, it continues to expand as a result of population growth and climate change, leading to rising temperatures and an increased prevalence of pests. As pests start to become more visible, tolerance drops. "
  • "The North American market is also highly fragmented with an estimated 20,000 pest control companies. In order to be able to identify potentially interesting acquisition objects both personal connections and market knowledge is required."
  • "Anticimex’s strategy for growing in the U.S. is acquiring high quality and well-established companies that serve as platforms for further growth. A substantial part of the pest control business in the U.S. is residential, which means that personal relationships are extremely important."
  • "Revenue grew from SEK 410 million to SEK 963 million – an increase close to 140 percent. "
  • "North America’s revenue now represents 15 percent of the group’s total revenue."
Quotes
  • "The Company has only one reportable segment, its pest and termite control business. Revenue, operating profit and identifiable assets for this segment, which includes the United States, Canada, Australia, Central America, the Caribbean, the Middle East, Asia, the Mediterranean, Europe, Africa, and Mexico "
Quotes
  • " In 2018, substantially all Terminix revenue was generated in the United States, with approximately two percent derived from international markets,"
  • "For the year ended December 31, 2018, Terminix recorded revenue of $1,655 million and Adjusted EBITDA of $333 million. "
  • "In 2018, 59 percent of Terminix revenue was generated from pest control services and 36 percent was generated from termite and home services, which includes crawlspace encapsulation, wildlife exclusion and insulation services, with the remaining five percent primarily from the distribution of pest control products. "
  • "In 2018, 67 percent and 33 percent of pest control revenue was related to residential services and commercial services, respectively, and 93 percent and seven percent of revenue from termite and home services was related to residential and commercial services, respectively. "
  • "Approximately 80 percent of Terminix revenue comes from customers who enter into contracts with the option to renew annually. "
  • "The Terminix national branch structure includes approximately 310 company-owned locations and approximately 100 franchise locations, which serve approximately 2.8 million customers in 47 states and the District of Columbia. Terminix’s approximately 9,600 employees made a daily average of 50,000 visits to residential and commercial customer locations during 2018. "
Quotes
  • "Rollins, Terminix, Rentokil, & Ecolab generate over 30% of industry revenues "
  • "$18 billion industry globally with an expected growth rate of 4-5% annually; $12+ billion US"
  • "US, roughly 70% residential US and 30% commercial"
  • "US market is 20,000 companies; Highly fragmented market"