Sales rise but expansion hits Regus’ profits
REGUS, the flexible office space provider, yesterday posted strong sales growth despite taking a hit from its rapid expansion plan.
Turnover in the first quarter grew by 8.8 per cent to £299.3m, boosted by a £26 increase in revenue per occupied workstation to £1,883.
Regus said its mature business – comprising the centres opened before the end of 2010, accounting for over 85 per cent of the company’s global portfolio – grew revenues 4.4 per cent to £282.2m.
“This like-for-like increase builds further on the strong performance in 2011, reflecting continued healthy levels of occupancy,” the company said in a statement.
Regus’ accelerated pace of expansion, which has seen 37 new centres opened in the last three months compared to 12 in the same period last year, took its toll on profitability.
But the company said it is on track to open the planned 200 new centres before the end of 2012, assuring that it expects the financial drag from new centres to diminish through the remainder of the year.
Headquartered in Luxembourg, Regus provides flexible working space such as offices, meeting rooms, business lounges and reception facilities.
While the majority of its revenues come from the Americas, it has “strong exposure” to emerging markets where there is a heavy reliance on virtual offices.
Founded in Brussels in 1989, Regus now counts Google, Disney, Starbucks and BP among its clients.
Its shares fell one per cent to 108.5p yesterday.