22nd Oct 2008 07:00
FOR IMMEDIATE RELEASE 22 October 2008
THE DAVIS SERVICE GROUP PLC
Interim Management Statement
Nine month period to 30 September 2008
The Board of The Davis Service Group Plc today issues its interim management statement for the nine month period ended 30 September 2008.
Overview
In the first nine months of the year we achieved double digit growth in revenue and operating profit compared with the same period last year.
For the period 1 July 2008 to 30 September 2008 ("the third quarter") we grew profit before tax from its neutral position at the half year benefitting from foreign exchange translation and the contribution from acquisitions as well as organic revenue growth.
Divisional Performance
Nordic
The organic revenue growth trends we saw in our Nordic region in the first half continued in the third quarter with a stronger margin as expected. New sales opportunities, assisted by the salesforce investments we made in the first half, continue to be generated especially in sectors not currently being affected by economic conditions.
Continent
We have made good progress in the third quarter in Holland, Poland and our workwear business in Germany, where we have seen profits move ahead strongly. We are in the process of restructuring German healthcare and our expectations of making a modest operating profit this year remain unchanged.
UK & Ireland
Hotel volumes continued to soften through the third quarter. Energy prices may be less extreme than previously expected but the key challenge for the business is to ensure that price increases for 2009 at least recover the level of inflation. Our healthcare business continued to see good volume growth. We are making progress with our Clinical Solutions and decontamination businesses in readiness for the two National Decontamination Programme contracts that commence mid 2009.
Financial Position
We continue to maintain a strong balance sheet. Our committed facilities of over £700 million provide significant headroom to net debt and are committed until at least June 2012. We increased the proportion of fixed rate borrowings in September 2008 and now have £340 million equivalent of borrowings fixed at a rate of 4.2%.
Outlook
We remain alert to the changing economic prospects throughout Europe, recognising that there will be differences in the way they impact the various parts of our business. We continue to take action to align our cost base to the current trading environment.
Our expectations for the group's outcome for 2008 are in line with those set out in our Half Year Report.
The Davis Service Group will issue a pre close statement for the full year to 31 December 2008 on 19 December 2008.
For further information contact:
|
Davis Service Group |
Financial Dynamics |
|
Roger Dye, Chief Executive |
Richard Mountain |
|
Kevin Quinn, Finance Director |
Harriet Keen |
|
Telephone 020 7259 6663 |
Telephone 020 7269 7121 |
Note:
1. Davis Service Group is a focused European textile maintenance business with leading positions in most of the
countries in which it operates. As a focused business we are able to mobilise our resources to drive our strategies in
our core area of expertise.
2. All financial information sourced from management accounts; operating profit and earnings per share stated before
exceptional items and amortisation of customer contracts and intellectual property rights.
3. Statements made in this announcement that look forward in time or that express management's beliefs, expectations
or estimates regarding future occurrences are "forward-looking statements" within the meaning of the United States
federal securities laws. These forward-looking statements reflect the Group's current expectations concerning future
events and actual results may differ materially from current expectations or historical results.
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