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1. Company Snapshot

1.a. Company Description

Intertek Group plc provides quality assurance solutions to various industries in the United Kingdom, the United States, and internationally.It operates in three segments: Products, Trade, and Resources.The Products segment offers assurance, testing, inspection, and certification services (ATIC), including laboratory safety, quality and performance testing, second-party supplier auditing, sustainability analysis, products assurance, vendor compliance, process performance analysis, facility plant and equipment verification, and third party certification.


This segment serves a range of industries, including textiles, footwear, toys, hardlines, home appliances, consumer electronics, information and communication technology, automotive, aerospace, lighting, building products, industrial and renewable energy products, food and hospitality, healthcare and beauty, and pharmaceuticals.The Trade segment provides cargo inspection, analytical assessment, calibration, and related research and technical services to the petroleum and biofuels industries; inspection services to governments and regulatory bodies to support trade activities; and analytical and testing services to agricultural trading companies and growers.The Resources segment offers technical inspection, asset integrity management, analytical testing, and ongoing training services for the oil, gas, nuclear, and power industries.


This segment also provides a range of ATIC service solutions to the mining and minerals exploration industries covering the resource supply chain from exploration and resource development, through to production, shipping, and commercial settlement.The company also offers cyber security services.Intertek Group plc was founded in 1885 and is based in London, the United Kingdom.

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1.b. Last Insights on ITRK

Intertek Group's recent performance was negatively impacted by flat revenue growth in its first half 2025 results, with revenue of UK£1.67b matching the previous year's figure. The company's failure to demonstrate significant top-line growth may have contributed to investor disappointment. Additionally, the testing, inspection, and certification market, where Intertek operates, faces challenges such as high costs, which may have weighed on the company's performance.

1.c. Company Highlights

2. Intertek Delivers Robust 2024 Performance with Strong Financial Metrics

Intertek reported a stellar financial performance for 2024, surpassing market expectations with mid-single-digit like-for-like revenue growth for the fourth consecutive year. The company achieved a 6.6% increase in group revenue at constant rates, alongside a 17.4% operating margin, representing a 100 basis point improvement. Earnings per share (EPS) rose by 15.2%, underscoring the company's ability to convert revenue growth into profitability. Intertek also generated a record adjusted cash flow of £789 million, with free cash flow reaching £409 million, highlighting strong cash generation capabilities.

Publication Date: Mar -07

📋 Highlights
  • Strong Financial Performance:: Intertek delivered a robust 2024 performance with mid-single-digit like-for-like revenue growth, exceeding market expectations. Group revenue increased by 6.6% at constant rates, supported by strong execution of its AAA Strategy and a focus on high-growth markets.
  • Divisional Growth Highlights:: The company reported strong growth across its divisions, with Consumer Products (7.6%), Corporate Assurance (8.6%), Health and Safety (9%), and World of Energy (8%) leading the way. Industry and Infrastructure also saw a 2.4% revenue increase, demonstrating broad-based growth.
  • Margin Expansion and Profitability:: Operating margin improved by 100 basis points to 17.4%, driven by operating leverage, productivity gains, and mix effects. The company raised its medium-term margin target to 18.5%+, reflecting confidence in its ability to sustain margin accretion through operational excellence.
  • Capital Allocation and Shareholder Returns:: Intertek announced a £350 million share buyback program and increased its dividend by 40.1%, underscoring its commitment to returning value to shareholders. The company also reported record adjusted cash flow of £789 million and free cash flow of £409 million.
  • Strategic Initiatives and Growth Outlook:: Intertek emphasized the success of its China+1 strategy and expansion in the APAC region, with China delivering 6.7% like-for-like growth. The company is well-positioned to capitalize on global supply chain shifts and expects mid-single-digit revenue growth in 2025, supported by disciplined capital allocation and bolt-on acquisitions.

Divisional Performance and Strategic Execution

The company's divisional performance was equally impressive, with Consumer Products leading the way with 7.6% growth, followed by Corporate Assurance at 8.6%, Health and Safety at 9%, and World of Energy at 8%. Industry and Infrastructure saw a more modest 2.4% revenue increase. Intertek's AAA Strategy continues to drive growth, with a particular focus on expansion in China, which delivered 6.7% like-for-like growth, and the broader APAC region. The China+1 strategy is proving effective in diversifying supply chains and expanding Intertek's addressable market in APAC and the Americas.

Future Outlook and Margin Expansion

Looking ahead, Intertek raised its medium-term operating margin target to 18.5%+, reflecting confidence in its ability to maintain profitability. CFO Colm Deasy outlined financial guidance, including a 25-26% effective tax rate and £135-145 million in capital expenditures. The company is well-positioned to capitalize on global supply chain shifts, supported by a strong balance sheet and strategic investments in high-growth markets. Andre Lacroix, CEO, emphasized the importance of margin accretion and quality revenue growth, driven by operational excellence and strategic capital allocation. He highlighted the potential for growth in niche segments, where site managers can allocate resources to accelerate growth and improve margins. Lacroix expressed confidence in achieving the ambitious 18.5%+ margin target, citing strong performance management and mix management at the local level.

Valuation and Shareholder Returns

Intertek's strong financial performance and growth prospects are reflected in its valuation metrics. The stock currently trades at a price-to-earnings (PE) ratio of 27.23x and an enterprise value-to-EBITDA (EV/EBITDA) ratio of 13.15x, indicating a premium valuation. However, the company's strong free cash flow yield of 5.15% and a dividend yield of 2.45% provide some comfort to investors. The announcement of a £350 million share buyback program further underscores management's commitment to returning value to shareholders. While the valuation appears rich, Intertek's consistent execution, margin expansion, and growth opportunities in high-value segments suggest that the premium is justified.

3. NewsRoom

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FTSE, US stocks and bitcoin see downbeat start to December

Dec -01

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Intertek Acquires Leading US-Based Flooring Products Testing Company Professional Testing Laboratory

Nov -26

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Intertek Group plc (LON:ITRK) Shares Could Be 32% Below Their Intrinsic Value Estimate

Nov -16

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Is Intertek Group plc's (LON:ITRK) Recent Stock Performance Influenced By Its Fundamentals In Any Way?

Oct -05

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FTSE 100 ends record breaking week at new high

Oct -03

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Barclays (LSE:BARC): Evaluating the Valuation Picture After Strong Share Price Gains

Sep -09

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Angle PLC Announces Change of Adviser

Sep -09

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Dairy Testing Company Evaluation Report 2025 | Eurofins Scientific, SGS Institut Fresenius, and Intertek Group Dominate with Global Reach, Comprehensive Portfolios, and Strong Compliance Expertise

Aug -26

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.71%)

6. Segments

Consumer Products

Expected Growth: 4.5%

Intertek Group plc's Consumer Products segment growth of 4.5% is driven by increasing demand for safety and quality assurance in the e-commerce and retail industries, coupled with rising consumer awareness of product safety and sustainability. Additionally, the segment benefits from the company's expertise in testing and certification, as well as its global reach and reputation.

Industry and Infrastructure

Expected Growth: 4.8%

Intertek Group plc's Industry and Infrastructure segment growth of 4.8% is driven by increasing demand for assurance, testing, inspection, and certification services in the energy, transportation, and construction industries. Additionally, growing investments in infrastructure development, renewable energy, and industrial automation are contributing to the segment's growth.

World of Energy

Expected Growth: 5.2%

The 5.2% growth in World of Energy from Intertek Group plc is driven by increasing demand for energy efficiency and sustainability, rising adoption of renewable energy sources, and growing need for asset integrity and inspection services in the energy sector, coupled with Intertek's expanding presence in emerging markets and strategic acquisitions.

Corporate Assurance

Expected Growth: 4.2%

Intertek Group plc's Corporate Assurance segment growth of 4.2% is driven by increasing demand for risk-based auditing, expansion in emerging markets, and growing need for compliance with regulatory requirements. Additionally, the company's investment in digitalization and technology has improved operational efficiency, enabling it to capitalize on new business opportunities.

Health and Safety

Expected Growth: 4.7%

Intertek Group plc's Health and Safety segment growth of 4.7% is driven by increasing demand for risk-based services, expansion in high-growth markets, and strategic acquisitions. Additionally, growing regulatory requirements, rising awareness of workplace safety, and adoption of digital solutions for safety management are contributing to the segment's growth.

7. Detailed Products

Assurance

Intertek's Assurance segment provides independent third-party assurance services, including auditing, testing, inspection, and certification, to ensure products, assets, and supply chains meet regulatory and industry standards.

Testing and Certification

Intertek's Testing and Certification segment provides testing, inspection, and certification services to ensure products meet regulatory and industry standards, including safety, performance, and quality testing.

Product Assurance

Intertek's Product Assurance segment provides testing, inspection, and certification services to ensure products meet regulatory and industry standards, including safety, performance, and quality testing.

Cyber Assurance

Intertek's Cyber Assurance segment provides cybersecurity testing, assessment, and certification services to ensure products and systems meet cybersecurity standards and regulations.

Supply Chain Assurance

Intertek's Supply Chain Assurance segment provides services to ensure supply chains meet regulatory and industry standards, including auditing, testing, and certification.

8. Intertek Group plc's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Intertek Group plc is medium due to the presence of alternative testing, inspection, and certification services provided by competitors.

Bargaining Power Of Customers

The bargaining power of customers for Intertek Group plc is low due to the company's strong brand reputation and the lack of concentration among its customer base.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Intertek Group plc is medium due to the presence of multiple suppliers for testing and inspection equipment and services.

Threat Of New Entrants

The threat of new entrants for Intertek Group plc is low due to the high barriers to entry, including the need for significant capital investment and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry for Intertek Group plc is high due to the presence of several established competitors in the testing, inspection, and certification services market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 42.54%
Debt Cost 4.84%
Equity Weight 57.46%
Equity Cost 7.13%
WACC 6.16%
Leverage 74.04%

11. Quality Control: Intertek Group plc passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
ISS

A-Score: 5.9/10

Value: 6.1

Growth: 5.3

Quality: 5.2

Yield: 1.9

Momentum: 8.5

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Elis

A-Score: 5.8/10

Value: 6.5

Growth: 5.9

Quality: 4.6

Yield: 3.1

Momentum: 6.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Intertek

A-Score: 5.3/10

Value: 3.4

Growth: 4.4

Quality: 5.9

Yield: 5.0

Momentum: 3.5

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
Sodexo

A-Score: 5.0/10

Value: 7.6

Growth: 3.9

Quality: 3.7

Yield: 8.1

Momentum: 0.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
ID Logistics

A-Score: 4.4/10

Value: 3.6

Growth: 7.9

Quality: 2.4

Yield: 0.0

Momentum: 5.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
InPost

A-Score: 3.5/10

Value: 3.6

Growth: 8.0

Quality: 5.3

Yield: 0.0

Momentum: 0.5

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

46.06$

Current Price

46.06$

Potential

-0.00%

Expected Cash-Flows