19th Jul 2005 07:00
Ricardo PLC19 July 2005 19 July 2005 Ricardo plc Pre-close trading statement Ricardo plc is a leading UK independent automotive consultancy, employing 1,700people with technical centres in the UK, USA, Germany and the Czech Republic.The company's client list includes the world's major OEMs. Ricardo is aconstituent of the FTSE techMark 100. Today the Board of Ricardo plc is providing a trading update before the Companyenters the close period in respect of the year ended 30 June 2005. Ricardo willannounce its Preliminary Results on Monday 19 September 2005. Since the announcement of our interim results in February overall trading forthe second half has been in line with our expectations, with some weakness inGermany being offset by good performances in the UK, US and StrategicConsulting. The automotive market continues to be challenging, however the improving trendswe saw in the first half have continued and we are seeing a slightly moreencouraging outlook for the business. Our order book has continued tostrengthen, and has increased from £58m at the half year to £70m. The order bookreflects a better mix of contracts with an improved and broader customer base. In line with the general market decline in bond yields, our pensions deficitunder FRS17 is likely to increase significantly and we will provide more detailson the likely impact at our Preliminary results on 19 September 2005. Our UK business has continued to perform well and our operations at Leamingtonare beginning to see the benefits of the SAIC Motor Company Ltd ("SAIC")contract announced in May. After a slow start to the year, the USA performedwell in the second half, and our order book there is now at its strongest levelfor more than two years. In Germany all companies servicing the OEMs there,including Ricardo, have experienced weakening trading as the German automotivecompanies continue to struggle in the global market. We do not anticipate amarked improvement in this market during the first half of the new year. Ourstrategic consulting business continues to perform strongly. We continue to make good progress in the Far East. Our office in Shanghai openedon 12 July and business in Japan continues to grow. As previously reported the contract with SAIC will help SAIC establish their ownbrand product range and internal engineering capability in the UK. As theirstrategic partner for vehicle and powertrain development (engine andtransmission), Ricardo will lead the development of a range of vehicles (new andfacelift) with both gasoline and diesel engines targeted initially for theChinese market. In addition Ricardo will assist with the development of SAIC's in-house team andtheir understanding and experience of the automotive product engineeringprocess, as well as providing advice in related topics. We have now establishedand recently launched an office of 100 professional engineers in Leamington toservice this contract, with additional satellite teams operational on the groundin Shanghai. It still remains too early to predict the financial benefit of thiscontract in the new financial year. Overall, 2005 has been a year of solid performance, and a year of furtherprogress in recovering profitability levels. Enquiries: Ricardo plc Tel: 01273 455611Rodney Westhead, Chief ExecutiveAndrew Goodburn, Finance Directorwww.ricardo.com Gavin Anderson & Company Tel: 020 7554 1400Laura Hickman/Charlotte Stone A conference call for analysts and investors will be held at 9am UK Time. Todial into the call, please call +44 (0)207 189 0208. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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