30th Aug 2005 07:03
Plant Health Care PLC30 August 2005 Embargoed until 7am 30 August 2005 Plant Health Care plc $40m contract with John Deere and Trading Update John Deere Contract Plant Health Care ("PHC" or the "Group") is pleased to announce that, followingsuccessful completion of a pilot test programme, it has now entered into a 10year contract with John Deere Landscapes ("JDL"). Under the terms of the contract, to maintain their exclusivity, JDL is requiredto purchase a minimum of approximately $40 million of PHC's products over the 10year term of the contract. The JDL and PHC partnership offers professional landscapers a three-yearguarantee on select nursery stock purchased from JDL provided that PHC's TreeSaver(R) product is incorporated at the time of planting. In addition to the warranty programme provided by JDL to its customers, PHC willbecome the exclusive provider of biological based products to all of JDL'swholesale outlet stores - which currently stands at around 300 stores. PHC's natural based Tree Saver(R) product will be used by the programme'scustomers to ensure the warranty remains effective. The programme's key promiseto its customers is to replace any trees or shrubs that fail during thethree-year period that are covered under the terms of the warranty. This innovative combination of a planting survival guarantee underpinned by theapplication of natural products is believed to be the first of its kind in theUnited States on this scale. Trading Update The Board has undertaken a thorough financial review of the business for theyear ending 31 December 2005. Following this process and additionally as aresult of the need to invest in infrastructure and financial systems to dealwith the new contracts that PHC has entered into, the cost base of the Group hasincreased. Accordingly, in terms of the current financial year, PHC is now anticipating anincreased cost base and, together with severance costs associated with thedeparture of the finance director and costs relating to a delay in the transferof PHC's lease on the first manufacturing site, the Board expects losses for theyear ending 31 December 2005, to be significantly greater than current marketexpectations. However, given the new business that PHC is contracting and the margin profileof some of the contracts it has entered into, the Board remains confident ofmeeting expectations for the year ending 31 December 2006. John Brady, CEO of Plant Health Care, said, "Our business strategy is to ensurethat our products reach the customer through innovative marketing concepts, andthis partnership with JDL confirms the progress Plant Health Care is making inthe sale and marketing of our products. We are very excited to be entering intothis 10 year relationship with the preeminent distributor of landscape andirrigation products in the world today. JDL has unrivaled distribution reach and depth of products and coupled withtheir strong belief in the future of environmentally friendly products createsexciting possibilities of cooperation in the future. Our Plant Health Care teamis thrilled with the opportunity to work with a company of John DeereLandscapes' caliber." Frank Bates, Senior VP of Operations, John Deere Landscapes, commented, "Thepilot programme was very controlled. As we look over the response and feedbackfrom the programme, JDL is compelled to take this innovative replanting survivalguarantee to a much broader market. Strategically, it has mitigated the economicrisk of plant life for the landscape contractor and allowed JDL to strengthenits position as the most viable single source for green industry products.Ultimately, Plant Health Care's technology and this agreement will enable JohnDeere Landscapes to help the landscape contractor reduce business risk andcost." For further information please contact: Plant Health Care plc John Brady, CEO Tel: 001 603 525 3702 John Deere Landscapes Jennifer Orechwa Tel: 001 770 255 2125 Tavistock Communications Tel: 020 7920 3150 Jeremy CareyChristian Taylor-Wilkinson Notes to Editors: About the programme The programme requires eligible landscape contractors to be trained andspecially certified on the programme as well as planting procedures. Once theeligible landscape contractor is certified and enrolled in the programme, allplant material purchased and installed under the guidelines will receive a threeyear warranty. The warranty is a trade warranty extended to the certifiedlandscape contractor that is purchasing the eligible nursery stock and it is nottransferable to the property owner. To learn more about the programme, visit the website www.JohnDeereLandscapes.com. About Plant Health Care Plant Health Care plc ("PHC") is a leading provider of natural products forplants and soil. Established in 1995 in Pittsburgh (Pennsylvania) in the UnitedStates, PHC currently has approximately 60 employees and has operations in theUS, Mexico, UK, Spain, and the Netherlands with technical support in Austria.The Group has two principal operating subsidiaries in the US - PHC Inc (PA) andPHC-REC. The Company listed on the AIM market of the London Stock Exchange inJuly 2004. Ticker symbol is phc. PHC's products are aimed at the horticulture, agriculture, turf grass,commercial landscaping, forestry and land reclamation industries and are bothenvironmentally beneficial and on the whole more cost effective than syntheticchemical alternatives. Through the commercialisation of these products, PHC iscapitalising on current long-term trends toward natural systems and biologicalproducts for plant care and soil and water management uses. PHC-REC is an environmental and reclamation engineering consulting firm whichprovides engineering and design services for reclamation lands disturbed bymining, construction, and other activities. PHC-REC is the recognised leader inthe use of biologically based solutions using mycorrhizal fungi and bacteria forthe establishment of trees, shrubs, and grasses on these disturbed lands.PHC-REC was established in 1997 to exploit PHC's products and technology. About John Deere Landscapes John Deere Landscapes, a wholly owned subsidiary of Deere & Company (NYSE:DE),is the nation's leading supplier of wholesale irrigation, landscape lighting,nursery and landscape supplies for green industry contractors. John DeereLandscapes also offers contractors additional related services that supporttheir core businesses. Established in 2001, John Deere Landscapes currently operates around 300branches in the United States, with approximately 1800 employees. Through theCompany's vision of maximizing the success of all stakeholders, John DeereLandscapes is dedicated to becoming the distributor of choice for landscape andirrigation professionals. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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