Peel Hunt says 'buy' Berendsen despite expected currency hit

19th Dec 2014 11:20

Peel Hunt is advising investors to 'buy' into Berendsen after the textile service company forecast a currency hit to revenue, but said it had improved margins in its key growth businesses.Berendsen, which provides industrial laundry services for hotels, hospitals and work-wear in London and across the UK, said trading since its interim management statement on 31 October had matched expectations.Berendsen said that while it expected exchange rates to weigh on its results, it remained confident of achieving a year of good underlying progress in line with its previous expectations.Peel Hunt said it was keeping its 2014 pre-tax forecasts unchanged, with pre-tax profit expected to rise 3% to £139.9m against a consensus of £138.3m.The broker's Chris Bamberry said: "The potential remains for continued margin expansion ahead of market forecasts, and wetherefore believe the risk to underlying estimates (ie at constant currency) over the next few years remains firmly on the upside, despite the macro-economic slowdown in continental Europe."