27th Jun 2006 12:06
Havelock Europa PLC27 June 2006 Tuesday 27 June 2006 HAVELOCK EUROPA PLC AGM STATEMENT At this afternoon's AGM of Havelock Europa, the education and retail interiorsand point of sale display Group, the Chairman, Malcolm Gourlay, made thefollowing remarks with regard to current trading and prospects. "Order input for the first six months of the year has been healthy in alldivisions and particularly in the Education and Retail Interiors Divisions. Manyof these orders are for delivery in the second half which is traditionally theGroup's peak period for activity. ESA McIntosh, the UK market leader in fitted furniture and equipment forschools, has experienced record levels of orders in its core "direct to schools"market and has achieved start dates in line with its expectation for business inthe PFI arena, with activity now underway in 14 of the 16 contracts scheduledfor commencement this year. The consolidation of the management teamsresponsible for ESA McIntosh and Retail Interiors into a single operating boardhas been completed and the benefits, in relation to manufacturing andprocurement efficiencies, are starting to come through. Orders and enquiries in the Group's two classroom accessory businesses,TeacherBoards and Clean Air, are also running ahead of last year. Within the Retail Interiors Division, Marks & Spencer has returned as asignificant customer and activity in the financial services area has beenrobust. Despite fears of a slow down in the High Street, the diversification ofthe customer base within this division and the entry last year into thehealthcare market have created a wider spread of opportunity and some loweringof exposure to retail volatility. The Point of Sale Division has suffered the loss of a major customer, as aresult of the sale of Kwik Save by Somerfield, which has affected both thebusiness and the level of activity at the Group's printing subsidiary inBristol. Nevertheless, early action to consolidate this operation under themanagement team of Showcard Print, headquartered in Letchworth, is beginning toshow benefits. An extensive redundancy programme has taken place which willgenerate significant savings and this, together with the rationalisation of bothproperty and plant, will, in due course, help to mitigate the effect of thereduction in revenue on profit. In Letchworth, both orders and sales are runningat a substantially higher level than last year as a result of the addition of anumber of new customers. As pointed out on earlier occasions, the requirement under IFRS to recogniserevenue after completion of the installation process, particularly in theeducation businesses, continues to weight the seasonal bias towards the secondhalf of the year, during which period almost all of the Group's profit will beearned. The Board remains enthusiastic about the markets in which it is operating. Thetemporary hiatus in the PFI education sector, which followed the withdrawal ofJarvis, in late 2004, is now over and there appear to be positive indicationsfrom Government of continuing commitment towards the refurbishment and renewalof education infrastructure well beyond 2008. The Board expects to make furtherprogress in the full year and anticipates continuing growth in 2007,particularly in the education and healthcare sectors. The Group remains interested in making further acquisitions in existing andrelated markets, exhibiting long term growth." Enquiries: Havelock Europa PLC 01383-820 044 Hew Balfour (Chief Executive) 07801-683 851Grant Findlay (Finance Director) 07768-745 960 Bankside Consultants Limited Charles Ponsonby 020-7367 8851 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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