DRYCLEANING and workwear specialist Johnson Service Group is looking for European growth.

The Preston Brook-based firm wants to expand its textile rental division to mainland Europe.

Chief executive John Talbot said: “We have a very strong offer in the rental division.

“We are going to be continuing to look for bolt-on acquisitions, but feel now is the time to start looking at doing something outside the UK.”

The group’s annual figures to December 31 showed good progress at its textiles arm.

Group revenues were flat at £235.1m, compared with £236.4m.

After exceptional costs, including £6.5m restructuring within the Prescot-based drycleaning division, pre-tax profits fell from £20.6m to £4.2m. However, on an adjusted basis, pre-tax profits rose 18.9% to £14.5m.

Debts fell from £67.6m to £59.5m and finance costs were reduced from £5.7m to £3.8m, due to lower borrowings.

Textile rental, the largest part of the group, performed well despite tough economic conditions in its markets, recording a fall of just 1.5% in revenues of £115.1m.

However, better cost controls achieved a 13.7% improvement in adjusted operating profits of £16.6m.

Drycleaning suffered a £1.6m hit from the severe weather in January and November and December last year, contributing to a drop in sales from £83.5m to £78.7m and a £1m fall in adjusted operating profits of £2m.

But the roll-out of its “Green Earth” brand in its 470 branches, using environmentally-friendly cleaning materials, is adding to profitability, while more than 100 branch managers are now “empowered”, leading to better profitability.

Mr Talbot said: “Empowerment is giving shop managers more autonomy in terms of setting pricing and opening hours in their local market.” Finance director Yvonne Monagahan said empowered branches make more profit: “They are running a few per cent ahead of the rest of the estate.”

Revenues at facilities management arm SGP were 16.3% higher at £33.6m, and adjusted operating profits rose 9.1% to £3.6m.

Mr Talbot said: “The group is now in a strong position. It is cash generative and has significantly reduced debt. We believe that there are opportunities to expand each of the group’s divisions.”