18th Sep 2008 07:00
Cosalt plc
("Cosalt" or the "Group")
Interim Management Statement
Cosalt announces its Interim Management Statement in respect of the period from 28 April to 17 September 2008.
Update on Trading
In the third quarter to 27 July 2008 the turnover in the safety and protection business increased by 51% over the comparable period in 2007. The majority of this uplift arises from the contribution from GTC, which was acquired in October 2007, whilst trading in the rest of the safety and protection business has remained strong. The Group has sustained the improved headline operating margins of around 8% (compared to 4% for the third quarter of 2007) as outlined in our Interim Results for the 26 weeks to April 2008.
Following the recent Board and management changes the Group has been restructured into two customer focused divisions; Marine and Offshore Oil and Gas both of which are supported by the need to meet increasing legislation in our areas of operation. Each of these divisions has its own dedicated management team.
Acquisition of Myhre-Maritime A/S ("Myhre")
The Group continued to implement its strategy of expanding its services by acquiring earning enhancing complementary businesses with the announcement of the acquisition of Myhre on 26 June 2008. Myhre is a safety and protection business located in Stavanger, Norway. The acquisition of Myhre complements the Group's already strong position in the North Sea and follows its strategy of expanding its global footprint. The acquisition was completed at the end of July.
Contract wins
The Group continues to benefit from its strong position in the North Sea with extensions to existing agreements for the supply of marine safety equipment with a number of operators including BP and the extension of the Offshore Oil and Gas division's operations following the award of a contract with Perenco to supply lifting and inspection services in the Southern North Sea. The Offshore Oil and Gas division's contract with Exxon Mobil for the supply and inspection of lifting equipment has been extended to their Norwegian operations following the acquisition of Myhre. The Group is benefiting now from its Pan North Sea geographic base. Discontinued Businesses
Cosalt continues to implement its strategy of becoming a focused player in the marine safety and oil and gas sectors. As part of this strategy the disposal of the Banner schoolwear business was successfully completed on 13 May.
The Holiday Homes business continues to operate in an industry which is experiencing very challenging conditions and trading has deteriorated further in the second half of the year. The Board expects to be able to announce the details of its exit from this business shortly and is pursuing a number of options to achieve this.
Financial Position
As part of the acquisition of Myhre-Maritime the Group restructured its banking facilities during the period with a £34m unsecured three year committed facility from HSBC and RBS.
Outlook
The Group continues to make excellent progress in its core safety and protection business where it has a market leading position in the regions in which it operates. Demand for these legislation driven services remains good and the Board continues to be confident in its outlook for this business. The Group's development will continue to be driven by both organic growth and acquisitions in the Marine and Offshore Oil and Gas divisions. The Group's key strategic objectives remain to broaden the existing product range and to expand the Group's geographic coverage.
18 September 2008
ENQUIRIES:
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Cosalt plc |
Tel: 01472 504504 |
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Mark Lejman, Chief Executive |
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Mike Reynolds, Finance Director |
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College Hill |
Tel: 020 7457 2020 |
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Mark Garraway |
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Adam Aljewicz |
For further information, visit the website www.cosalt.com
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