We believe that Spotless Group Holdings is well placed to deliver investors a combination of growth and yield given their exposure to the growing demand for outsourcing. Spotless is the leading provider of outsourced facilities services and laundry and linen services with revenues 1.2x higher than its closest peer. Their recent result highlighted their strong position and positive industry dynamics with $950m of contract renewals and $350m in new contract wins. The company is on track to deliver both earnings and dividend growth that is approaching double digits for each of the next 3 years, which we find extremely attractive in the current environment. Despite the favorable outlook, the company trades on a 1year forward PE 13.5x and a Yield of 5.4%, which represents a 20% discount to both its International peers and Australian Industrial companies. Given this, we feel investors will be rewarded as the company continues to execute their strategy within a growing sector.


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