9th May 2008 11:44
TDG PLC09 May 2008 9 May 2008 TDG plc ("the Group") Interim Management Statement, AGM and Update on Possible Offers TDG plc, one of Europe's major supply chain management and logistics serviceproviders, announces its first Interim Management Statement (as required by theUK Listing Authority's Disclosure and Transparency Rules) ahead of its AnnualGeneral Meeting, to be held at 1 Birdcage Walk, London, SW1H 9JJ, at 12 noontoday. At that meeting Charles Mackay, Chairman, will give the following update for theperiod from 1 January 2008 to date: "Financial Position and Performance of the Group The Group has made a good start to the year, with trading in the first threemonths ahead of our previous expectations and well ahead of the comparableperiod in 2007. As a consequence, we expect the first half profits to be lessweighted to the second quarter than was the case last year. Cash flow in the first quarter has also been better than expected with a lowerworking capital requirement and the benefit of proceeds from the sale of asurplus property in the Netherlands. This has funded our continuing programme ofcapital expenditure in support of trading opportunities. Despite the increasedstrength of the Euro, net debt at the end of the quarter was £19.0m, comparedwith £21.1m at 31 December 2007. Whilst gross new business wins in the first quarter have been at a similar levelto that in 2007, with most of this won in the more specialised areas of ourbusiness, net wins have been lower as a result of a particular customerconsolidation in the retail sector. There is some evidence of customers delaying placing orders with us given theuncertainty surrounding our ownership. This situation has also constrained ourability to make earnings enhancing acquisitions. However we do not, at thisstage, expect these issues to prevent the Group from meeting its previoustrading expectations for 2008. Material events and transactions The Board notes that Laxey Partners Limited ("Laxey Partners") has todayre-confirmed its interest in pursuing a possible offer for the Group and that,should an offer be made, it would be at the price already indicated of 266.25pence per share (equivalent to 275 pence per share less the dividend of 8.75pence per share proposed on 27 February 2008 and payable on 23 May 2008 whichshareholders are entitled to retain). In view of the uncertainty which has been created we are pleased that LaxeyPartners has satisfactorily completed its due diligence. The Board further notesfrom the statement that Laxey Partners expects its possible offer to beannounced in the near future, subject to its remaining (waivable) preconditions,which include finalisation of financing arrangements and the recommendation ofthe Board. Laxey Partners has again reserved the right to offer a lower priceif it were to be recommended by the TDG Board. The proposal from Laxey does not amount to a firm intention to make an offer andaccordingly, even if the preconditions are waived or satisfied there is nocertainty that an offer will be made or of the level of any such offer. We have also received from Wincanton Plc ("Wincanton") an indicative cashproposal at 281.25 pence per ordinary share (equivalent to 290 pence perordinary share less the dividend of 8.75 pence per share proposed on 27 February2008 and payable on 23 May 2008 which shareholders are entitled to retain). Thiswould be 15 pence per share above the proposal of Laxey Partners. Wincanton hasreserved the right, with the recommendation of the Board of TDG to make an offerfor TDG at a lower price and/ or to vary the mix of consideration specified. The announcement of a formal offer by Wincanton would be subject to, inter alia,the recommendation of the Board of TDG, satisfactory completion of duediligence, finalisation of financing and support from TDG's major shareholdersincluding Laxey Partners. Discussions are ongoing and we will updateshareholders on progress as and when appropriate. This announcement has been made with the agreement of Wincanton which is todaymaking a separate announcement in which it sets out the rationale for theproposal. The proposal from Wincanton does not amount to a firm intention to make an offerand accordingly there is no certainty that an offer will be made or of the levelor form of consideration of any such offer. In light of the above, TDG will seek to agree with Laxey Partners, Wincanton andthe Takeover Panel a formal timetable in which each party must either announce afirm intention to make an offer for TDG or announce that it does not intend tomake an offer. Outlook As previously stated, whilst the broad economic environment looks uncertain, thecombined benefits of our revised strategy, our mix of open and fixed-pricecontracts, our balanced property portfolio and a strong balance sheet shouldprovide resilience. We will continue to pursue our strategy of building positions of strength inspecialised sectors. This strategy has already improved the quality and levelof the Group's earnings. At the same time we will look to counter ongoingmargin pressure though effective account management, bidding selectively for newbusiness and aggressive cost management to enhance efficiencies. We have a strong balance sheet which provides the Board with flexibility. Wheresuitable opportunities are available, we will continue to make selective andearnings enhancing acquisitions that move the Group further into our chosenareas. Against this background and subject to early resolution of the uncertaintysurrounding future ownership, we continue to be confident that the Group willmake further progress in 2008." Enquiries: TDG Financial Dynamics David Garman, Chief Executive Ben Foster Jeffrey Hume, Finance Director Marc Cohen Tel: 020 7838 7775 Tel: 020 7831 3113 Notes for Editors: 1. On 27 February the Board announced that it had received an indicative cash offer from Laxey Partners at 275 pence per ordinary share (less the dividend proposed that day of 8.75 pence per share) for the issued and to be issued share capital of TDG plc ("TDG"). Laxey Partners' preconditions to announcing a firm intention to make an offer were satisfactory due diligence, financing and TDG Board recommendation of the offer. Laxey Partners reserved the right to waive any or all of its preconditions (with the exception of due diligence which has now been completed satisfactorily). In its announcement Laxey explained that discussions were ongoing and there could be no certainty that the approach will result in a formal offer being made for TDG even if the preconditions are satisfied or waived. Laxey Partners, which owned approximately 22 per cent. of the issued share capital of TDG, reserved the right to offer a lower price if it were to be recommended by the TDG Board. 2. In 2007 the Group increased its headline profit before tax by 9% to £15.7m on a turnover of £669.5m. Headline earnings per share increased by 10% to 14.1p. Total continuing earnings per share increased by 14% to 17.5p. 3. TDG is a logistics and supply chain solutions provider with operations in six countries across Europe. The direction of its business is increasingly toward more specialised areas where the Group can compete not solely on price but also on capability, flexibility and service. These areas offer better returns and a competitive environment more suited to the Group's strengths. The Group's multinational customers include Coca-Cola, Kimberly-Clark, SC Johnson, Kellogg's and Diageo in the Contract Logistics division; together with Johnson Diversey, Corus, BASF, Bayer, PPG and Tesco in the Chemicals division. 4. The Contract Logistics division has made two UK freight forwarding acquisitions - Bradship in November 2006 and Brisk Airfreight in February 2007, both of which complement TDG's successful freight forwarding and freight management operations in Ireland and the Netherlands. In addition the UK transport operations of SCA were acquired at the end of 2006, strengthening capability in the specialised field of paper and packaging logistics. 5. In February 2007 the Chemicals division acquired Doman, a chemicals logistics business in Spain, having previously acquired Mond, a speciality chemicals logistics business based in Belgium, in February 2006. These businesses have extended TDG's coverage of this growing market into the key areas of Iberia, Benelux, the Ruhr and Northern France. Cautionary Statement: This announcement contains certain forward-looking statements with respect tothe financial condition, results, operations and businesses of TDG plc. Thesestatements and forecasts involve risk and uncertainty because they relate toevents and depend upon circumstances that will occur in the future. There are anumber of factors that could cause actual results or developments to differmaterially from those expressed or implied by these forward looking statementsand forecasts. Nothing in this announcement should be construed as a profitforecast.Dealing Disclosure Requirements: Under the provisions of Rule 8.3 of the Takeover Code (the 'Code'), if anyperson is, or becomes, interested' (directly or indirectly) in 1% or more of anyclass of 'relevant securities' of TDG or Wincanton, all 'dealings' in any'relevant securities' of that company (including by means of an option inrespect of, or a derivative referenced to, any such 'relevant securities') mustbe publicly disclosed by no later than 3.30pm (London time) on the Londonbusiness day following the date of the relevant transaction. This requirementwill continue until the date on which the offer becomes, or is declared,unconditional as to acceptances, lapses or is otherwise withdrawn or on whichthe 'offer period' otherwise ends. If two or more persons act together pursuantto an agreement or understanding, whether formal or informal, to acquire an'interest' in 'relevant securities' of TDG or Wincanton, they will be deemed tobe a single person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevantsecurities' of TDG by TDG, Laxey Partners or Wincanton, or by any of theirrespective 'associates', and all 'dealings' in 'relevant securities' ofWincanton by TDG or Wincanton or by any of their respective 'associates', mustbe disclosed by no later than 12.00 noon (London time) on the London businessday following the date of the relevant transaction. A disclosure table, giving details of the companies in whose 'relevantsecurities' 'dealings' should be disclosed, and the number of such securities inissue, can be found on the Takeover Panel's website atwww.thetakeoverpanel.org.uk. 'Interests in securities' arise, in summary, when a person has a long economicexposure, whether conditional or absolute, to changes in the price ofsecurities. In particular, a person will be treated as having an 'interest' byvirtue of the ownership or control of securities, or by virtue of any option inrespect of, or derivative referenced to, securities. Terms in quotation marks are defined in the Code, which can also be found on thePanel's website. If you are in any doubt as to whether or not you are requiredto disclose a 'dealing' under Rule 8, you should consult the Panel. TDG plc 4-5 Grosvenor Place London SW1X 7HJ This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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