Preliminary Results

23rd Oct 2008 07:00



GSH Group plc

PRELIMINARY RESULTS 2008

INTRODUCTION

GSH Group plc ("the Group" or "GSH") the international provider of bespoke facilities management and energy management solutions, announces preliminary results for the year ended 31 July 2008.

FINANCIAL HIGHLIGHTS:

Underlying profit* before tax rose by 37% to £11.1 million

Revenue increased to £200.4 million, up by 27%

Year end cash reserves stood at £15.0 million

Operating margin increased to 5.6% (2007: 5.2%)

Basic adjusted earnings per share of 36.6 pence, up by 19%

Proposed final dividend of 7.6 pence

Total dividend of 10.5 pence, up by 19%

* Underlying profit is defined as profit before adjustments in respect of non-trading items.

OPERATIONAL HIGHLIGHTS:

Healthy growth across all operating divisions

Order book at £757 million, up £148 million (2007: £609 million)

Acquisition of Utilitec BV in July 2008

New contracts with General Motors, Corus, Archon, Advance Realty Group and The Royal College of Surgeons  

Extensions to contracts with HBoS, Thomas Cook, Pfizer and KPN

Further investment in people and products

Rob Painting, interim Non-Executive Chairman of GSH said:

 "Once again we have demonstrated that the Group is in good shape with a solid set of results based predominantly on profitable organic growth in the period. Our overseas growth in particular is an exciting aspect and the Board believes that we are well positioned to capitalise on this and other new geographic markets."

For further information, please contact:

GSH Group plc Tel: 01782 200455

Chris McLain/Jamie Reynolds, co-Chief Executive Officers

Bell Pottinger Corporate & Financial

Nick Lambert/Chris Hamilton Tel: 020 7861 3232

KBC Peel Hunt

Julian Blunt/Daniel Harris Tel: 020 7418 8912

 

 

CHAIRMAN'S STATEMENT

Introduction

I am delighted to announce a further record year of full year results to the shareholders of GSH Group plc. 

The Group once again performed strongly during the period to deliver record full year financial results with profits before tax of £10.3 million and basic adjusted earnings per share of 36.6 pence, representing increases of 28% and 19% respectively compared to the prior full financial year. Cash reserves remain very healthy at £15 million at the end of the year. 2008 was our seventh consecutive year of revenue and profits growth. 

During the year we experienced significant levels of organic growth across all our geographic segments with the US especially showing an impressive 92% year-on-year increase in revenue. In addition, our Continental European business acquired Utilitec BV, the Netherlands based specialist mechanical and electrical installation business, in July 2008. This will provide significant opportunities for the existing GSH Netherlands business and further strengthens our international service offering.

Financial Results

Our results are summarised in the table below:

	31 July 2008	Growth on 31 July 2007
Revenue	£200.4m	27%
Underlying profit before tax	£11.1m	37%
Profit before tax	£10.3m	28%
Basic adjusted earnings per share	36.6p	19%
Dividend per share	10.5p	19%

Dividend

In line with our progressive dividend policy the Board is proposing a final dividend of 7.6p (2007: 6.2p) an increase of 23%. If approved at the Annual General Meeting on 17 December 2008, the dividend will be paid on 23 January 2009 to shareholders on the register at close of business on 5 January 2009. 

Including the interim dividend of 2.9p (2007: 2.6p), paid on 16 May 2008, total dividends per share for the year will be 10.5p (2007: 8.8p), up 19%. This is GSH's fourth consecutive year of dividend increase which reflects the Group's continuing growth and an acknowledgement of our continued confidence in the Group's businesses.

Corporate Responsibility

The Board is committed to achieving the highest standards of Corporate Governance throughout the Group. Our commitment as a responsible and considerate employer is demonstrated by our ongoing investment in health and safety, risk management and ensuring that appropriate systems of internal controls are in place. GSH operates in a highly regulated industry and maintains the highest professional standards in all its operations and we will continue to set and comply with these standards. 

Board Changes

 

During the course of the year the Board has undergone a comprehensive restructuring as the Group faces up to the new challenges ahead. On 13 October 2008 we announced the appointment of Chris McLain and Jamie Reynolds as co-Chief Executive Officers following the resignation with immediate effect of Colin Tennent as Chief Executive Officer.

 

Chris has held a number of senior positions throughout the Group and has been instrumental in the success and growth of the business in recent years. He has extensive knowledge of the energy and facilities management sector. Chris has worked for GSH for 18 years and will take over responsibility for the Group's UK & Eire operations.

 

Jamie, previously the President of the Group's US business, will head up our existing operations in Europe and the US and also focus on further international opportunities. Jamie joined GSH in 1993 and has over 15 years experience in the energy and facilities management sector.

 

On 20 October 2008 I was appointed interim Non-Executive Chairman from the position of Senior Non-Executive Director. This followed the resignation of John Kelly as Non-Executive Chairman on 13 October 2008 and also earlier in the year the stepping down from the Board of then Non-Executive Chairman Stuart Graham to pursue other business commitments and opportunities. Non-Executive Director Duncan Hall also stepped down from the Board on 13 October 2008. On 20 October 2008, David Simons resigned as Chief Financial Officer and following brief periods as acting CEO and interim Chairman. David will continue to be employed by GSH to ensure an orderly handover and expects to leave the Group in twelve months. The Group is currently in the process of recruiting a permanent Chief Financial Officer and an appointment will be announced in due course.

 

The Board would like to thank all the former Board members for their contributions with particular recognition to Colin and David's roles in the Group's development. We wish them every success in the future.

 

The Board has embarked on the path of identifying some further Non-Executive Directors with the suitable attributes and experience to support our ambitious plans for further growth.

People

I am always impressed by the outstanding levels of service that GSH provides to its clients combined with the dedication and commitment demonstrated by our people. On behalf of the Board I would like to thank them for their efforts and hard work over this last year, helping us maintain our position as a leading provider of technical facilities services and energy management. There are more than 2,000 people directly employed across the Group and the long-term partnerships we have forged with our impressive and growing portfolio of Blue Chip clients would not be possible without such committed and talented individuals. 

Outlook 

We enter the new financial year with a robust business and a strong pipeline and contracted order book. Despite the worrying economic climate we are confident that the demand for our services and the opportunities for further growth within our current geographic footprint will continue. Looking forward, we also are keen to grow the Group further, developing our overseas presence.

Rob Painting

Interim Non-Executive Chairman 

23 October 2008

co-CHIEF EXECUTIVE OFFICERS' STATEMENT

Introduction

This is our first announcement to the shareholders of GSH as co-Chief Executive Officers, following our appointment on 13 October 2008. We have both held a number of senior positions throughout the Group and between us we have over 35 years of experience in the energy and facilities management sector.

The strength of our business model has enabled GSH to deliver another record year of double-digit growth in both revenue and underlying profit. Revenue is up 27% to £200.4 million and underlying profit before tax is up 37% to £11.1 million.

Operational Review

UK & Eire

UK & Eire revenue is up 23% to £153.5 million (2007: £125.3 million) and underlying profit increased by 31% to £9.3 million (2007: £7.1 million).

We have experienced significant growth across all our operating divisions and our strategic focus on the provision of targeted market solutions to existing and new clients has further strengthened our position in the marketplace. This is evident from contract extensions in the second half of the financial year with HBoS, Pfizer and Thomas Cook. We have not only been awarded additional properties within the respective portfolios but also the provision of additional services.

The investment in Information Communication and Technology (ICT) during the period has supported our ongoing innovations in terms of service delivery and customer service. The upgrade of our asset management system Maximo and wireless hand-held technology is strengthening our operational capabilities and ensures we continue to lead the marketplace in terms of innovative technology driven solutions.

The commercial activity in the UK & Eire is strong with a number of new contracts agreed, started and being mobilised this year. The current pipeline is strong with very healthy prospects.

International 

Our International business now has the required scale to be a key driver of future growth for the Group. This year our operations in the US and Continental Europe delivered very strong increases in revenue of 46% to £46.9 million (2007: £32.1 million).

We have made solid progress in the US where revenue increased by an impressive 92% to $39.0 million (2007: $20.3 million). This was primarily due to a number of energy management contract wins including Advance Realty Group, Meritage Properties, Principal Global Investors, Archon and Nexus. In the final quarter, we were awarded a facilities management contract with Simon Malls, the largest public real estate company in the US.

2008 has been a good year for our operations in Continental Europe. Revenue increased by 26% and underlying profit before taxation is up 82% to £1.9 million (2007: £1.0 million). We have been awarded a number of major new contract wins and contract extensions including; Corus, General Motors, Global Switch, KPN and Schiphol Airport.

In July 2008 we acquired Utilitec, a mechanical and electrical installation business based in Utrecht, Netherlands. Utilitec is a highly regarded total installation integrator, working as a project manager for commercial clients and datacentres. The acquisition of Utilitec has strengthened the existing project management and installation division.

The commercial activity in both the US and Continental Europe is encouraging and we are confident of converting further tenders in the near future.

Outlook

The Group has experienced a positive start to the new financial year and there is a healthy commercial pipeline for our services.

GSH is equipped to cope with changing market conditions and, whilst the current economic climate is a concern, we look forward to the future with confidence. Our energy management services continue to attract considerable interest across the Group and offer significant opportunities for further growth.

FINANCIAL REVIEW

Revenue up 27% to £200.4 million

Underlying profit before tax increased by 37% to £11.1 million

Basic adjusted earnings per share of 36.6 pence

Cash reserves at year end £15.0 million

Proposed final dividend of 7.6 pence

Introduction

The Group's revenue, profitability and operating margins all showed healthy growth during the year and cash management continued to be very positive.

Underlying profit before tax of £11.1 million was up 37% on last year (2007: £8.2 million) reflecting the continuing focus on top line growth combined with close management of indirect costs and overheads.  Conversion of profit to cash was also healthy with an EBITDA to operating cash ratio of 126% (2007: 95%).

Revenue

In the year ended 31 July 2008 revenue increased by 27% to a record £200.4 million (2007: £157.4 million). All geographic areas of the Group recorded strong organic growth.

 

Acquisitions

In July 2008 we acquired Utilitec BV, the Netherlands based specialist mechanical and electrical installation business. This will provide opportunities for the existing GSH Netherlands business and further strengthens our international service offering.

Profitability

Underlying profit before tax for the Group in the year increased by 37% to £11.1 million (2007: £8.2 million). The main part representing 77% of the Group revenues and profitability is derived from business activities in the UK & Eire where underlying profit before tax was up 31% to £9.3 million (2007: £7.1 million). As regards our overseas businesses, our operations in Continental Europe contributed an underlying profit before tax of £1.9 million (2007: £1.0 million), an increase of 82% over the previous year. In 2008 we invested further in our US operations and revenue increased by 93% to $39.0 million (2007: $20.2 million). 

The trend upwards in operating margin continued with an increase of 8% to 5.6% (2007: 5.2%). 

There was a share based payment charge in the year of £851k which has been ignored in the calculation of underlying profit. 

Taxation

The effective tax rate for the year was 31.7% (2007: 25.5%). 

Earnings per share

Basic adjusted earnings per share at 36.6 pence (2007: 30.7 pence) increased by 19% and adjusted diluted earnings per share of 35.8 pence (2007: 30.3 pence) was 18% up in the year.

Dividend

The Board believes that we should maintain the Group's progressive dividend policy and therefore recommends a final dividend of 7.6 pence per share (2007: 6.2 pence) payable on 23 January 2009 to all shareholders on the register at 5 January 2009. The interim dividend of 2.9 pence per share (2007: 2.6 pence) was paid on 16 May 2008, making a total dividend of 10.5 pence per share (2007: 8.8 pence). The dividend is covered 3.1 times by earnings (2007: 3.4 times).

Cash and Cash Management

There were some significant cash flows during the year.  Investing activities of £6.3 million includes capital expenditure of £2.8 million, the purchase of Utilitec BV for an initial consideration of £1.6 million and the deferred consideration of £0.4 million in respect of KMH Systems LLC.

 

Dividends totaling £2.0 million and corporation tax of £2.7 million were paid during the year.

Cash flow from operations in the year was again good with close control of working capital and the operating cash flow of £14.2 million was a healthy 126% (2007: 95%) of EBITDA.

At the end of the year the Group had £15.0 million of cash reserves.

 

Balance Sheet

Net assets have increased by £4.4 million to £22.3 million (2007: £17.9 million). This increase is predominantly due to retained earnings in the period.

Chris McLain 

Jamie Reynolds

co-Chief Executive Officers

  CONSOLIDATED INCOME STATEMENT

For the year ended 31 July 2008

	Note	2008 £000	2007 £000
REVENUE - CONTINUING OPERATIONS	1, 2	200,434	157,401
Direct costs		(153,858)	(118,168)
GROSS PROFIT		46,576	39,233
Administrative expenses		(35,301)	(31,120)
PROFIT FROM OPERATIONS - CONTINUING OPERATIONS		11,275	8,113
Finance income		55	254
Finance costs		(186)	(206)
UNDERLYING PROFIT		11,144	8,161
Pension gain		-	132
Share based payment charge		(851)	(254)
PROFIT BEFORE TAXATION		10,293	8,039
Tax expense	3	(3,263)	(2,050)
PROFIT FOR THE FINANCIAL YEAR		7,030	5,989
PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT		7,030	5,989
EARNINGS PER ORDINARY SHARE
- Basic	5	32.6p	29.9p
- Diluted	5	31.9p	29.5p

CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE

For the year ended 31 July 2008

 

		2008 £000	2007 £000
PROFIT FOR THE FINANCIAL YEAR		7,030	5,989
Actuarial (loss) / gain on retirement benefit obligations		(268)	121
Deferred tax on actuarial loss / (gain)		39	(36)
Deferred tax on share awards		-	106
Exchange differences on the retranslation of overseas undertakings		479	85
TOTAL RECOGNISED INCOME AND EXPENSE FOR THE YEAR		7,280	6,265
ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT		7,280	6,265

 

CONSOLIDATED BALANCE SHEET

At 31 July 2008

		Note		2008		2007
ASSETS				£000	£000	£000	£000
NON CURRENT ASSETS
Intangible assets				8,662		7,029
Property, plant and equipment				7,053		4,895
Investments				44		44
Deferred taxation				226		368
TOTAL NON CURRENT ASSETS					15,985		12,336
CURRENT ASSETS
Inventories				4,977		3,648
Trade and other receivables				45,082		32,403
Short term investments				588		494
Cash and cash equivalents				15,022		11,890
TOTAL CURRENT ASSETS					65,669		48,435
TOTAL ASSETS					81,654		60,771
LIABILITIES
CURRENT LIABILITIES
Trade and other payables				(56,835)		(40,272)
Financial liabilities				-		(53)
Current taxation		6		(1,702)		(1,319)
TOTAL CURRENT LIABILITIES					(58,537)		(41,644)
NON CURRENT LIABILITIES
Financial liabilities				-		(59)
Provisions				(371)		(832)
Retirement benefit obligations				(467)		(315)
TOTAL NON CURRENT LIABILITIES					(838)		(1,206)
TOTAL LIABILITIES					(59,375)		(42,850)
NET ASSETS					22,279		17,921
EQUITY
Share capital		7			216		216
Share premium account		7			5,364		5,364
Capital redemption reserve		7			682		682
Investment in own shares		7			(1,880)		(86)
Share based payments reserve		7			1,178		363
Translation reserve		7			637		158
Retained earnings		7			16,082		11,224
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT					22,279		17,921

  CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 July 2008

 

		2008			2007
		£000	£000		£000		£000
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before taxation		10,293			8,039
Adjustments for:
Depreciation		740			589
Amortisation of intangibles		119			112
Share based payments charge		851			254
Finance income		(55)			(254)
Finance costs		186			206
CASH FLOWS FROM OPERATIONS BEFORE CHANGES IN WORKING CAPITAL			12,134				8,946
Changes in working capital:
(Increase)/decrease in inventories			(1,650)				2,779
Increase in trade and other receivables			(10,044)				(8,820)
Increase in trade and other payables			14,278				5,322
Decrease in provisions			(543)				(1)
CASH GENERATED FROM OPERATIONS			14,175				8,226
Finance costs			(186)				(206)
Income tax paid			(2,739)				(2,048)
NET CASH GENERATED FROM OPERATING ACTIVITIES			11,250				5,972
CASH FLOWS FROM INVESTING ACTIVITIES
Finance income received		55			254
Purchase of intangible assets		(144)			(63)
Purchase of property, plant and equipment		(2,764)			(1,124)
Sale of property, plant and equipment		108			91
Deferred consideration paid		(395)			-
Purchase of subsidiary undertakings		(1,605)			(5,239)
Cash acquired with subsidiary undertakings		921			1,159
Payments for short term performance bonds and asset funding		(2,436)			(494)
NET CASH USED IN INVESTING ACTIVITIES			(6,260)				(5,416)
CASH FLOWS FROM FINANCING ACTIVITIES
Finance lease rental payments		-			(70)
Equity dividends paid		(1,963)			(1,560)
Issue of ordinary share capital		-			3,971
Receipts from exercised share options		1			33
Payments to acquire own shares		(238)			(12)
Sale of treasury shares		8			867
NET CASH (USED IN)/GENERATED FROM FINANCING ACTIVITIES			(2,192)				3,229
NET INCREASE IN CASH AND CASH EQUIVALENTS			2,798				3,785
Cash and cash equivalents at start of year			11,890				8,200
Effect of exchange rates on cash and cash equivalents			334				(95)
CASH AND CASH EQUIVALENTS AT END OF YEAR			15,022				11,890

 

1.	REVENUE	2008 £000	2007 £000
	Facilities management	140,819	121,692
	Projects	14,566	16,966
	Energyplus	45,049	18,743
		200,434	157,401

2.	SEGMENTAL REPORT

 

For management purposes, the Group's primary segments are analysed by geographical markets in which the business operates. The Group's risks and rates of return are affected predominantly by the countries in which it operates. As a result the group's primary reporting format is geographical segments. The Group's revenue, profit before taxation and net assets were all derived from its principal activities. Segmental information is presented using Group policies.

Primary reporting format: Geographical Segments	UK and Eire	Continental Europe	USA	Total
2008	£000	£000	£000	£000
EXTERNAL REVENUE	153,581	27,352	19,501	200,434
PROFIT FROM OPERATIONS	9,378	1,897	-	11,275
Finance income	28	8	19	55
Finance costs	(141)	(20)	(25)	(186)
UNDERLYING PROFIT	9,265	1,885	(6)	11,144
Pension curtailment gain	-	-	-	-
Share based payment charge	(664)	(53)	(134)	(851)
PROFIT BEFORE TAXATION	8,601	1,832	(140)	10,293
TOTAL ASSETS	61,541	13,324	6,789	81,654
TOTAL LIABILITIES	(40,988)	(10,163)	(8,224)	(59,375)
Other segment items
Capital expenditure	2,399	1,760	61	4,220
Depreciation expense	558	144	38	740
Amortisation expense	80	39	-	119

  

Primary reporting format: Geographical Segments	UK and Eire	Continental Europe	USA	Total
2007	£000	£000	£000	£000
EXTERNAL REVENUE	125,334	21,656	10,411	157,401
PROFIT FROM OPERATIONS	7,041	1,051	21	8,113
Finance income	209	7	38	254
Finance costs	(171)	(20)	(15)	(206)
UNDERLYING PROFIT	7,079	1,038	44	8,161
Pension gain	132	-	-	132
Share based payment charge	(218)	(21)	(15)	(254)
PROFIT BEFORE TAXATION	6,993	1,017	29	8,039
TOTAL ASSETS	49,603	7,369	3,799	60,771
TOTAL LIABILITIES	(31,980)	(5,808)	(5,062)	(42,850)
Other segment items
Capital expenditure	3,439	240	643	4,322
Depreciation expense	409	160	20	589
Amortisation expense	35	77	-	112

  

3.	TAXATION	2008			2007
		£000		£000	£000	£000
	Current tax:
	UK corporation tax on profits of the year	2,793			1,920
	Foreign tax	503			286
	Adjustments in respect of previous years	(236)			(187)
	Total current tax			3,060		2,019
	Deferred tax:
	Origination and reversal of timing differences		373		74
	Adjustments in respect of previous years	(170)			(86)
	Pension scheme	-			43
	Total deferred tax			203		31
	Tax on profit			3,263		2,050

	Factors affecting tax charge for the year:	2008 £000	2007 £000
	The tax assessed for the year is higher than the standard rate of corporation tax in the UK (28%). The differences are explained below:
	Profit before tax	10,293	8,039
	Profit before tax multiplied by standard rate of corporation tax in the UK 29.3% (2007: 30%)	3,016	2,412
	Effects of:
	Expenses not deductible for tax purposes	707	77
	Adjustments in respect of previous periods	(406)	(273)
	Pension scheme	127	43
	Difference in tax rates in foreign subsidiaries	(181)	(209)
	Total tax charge for the year	3,263	2,050

  

4.		DIVIDENDS
			2008 £000	2007 £000
	Equity:
	Ordinary shares - 2006 final		-	1,032
	- 2007 interim		-	528
	- 2007 final		1,337	-
	- 2008 interim		626	-
			1,963	1,560

5.	EARNINGS PER ORDINARY SHARE

The calculations of earnings per share are based on the following profits and number of shares:

 

		Basic   2008 £000	Basic adjusted 2008 £000	Diluted   2008 £000	Basic   2007 £000	Basic adjusted 2007 £000	Diluted   2007 £000
	Profit for the financial year	7,030	7,030	7,030	5,989	5,989	5,989
	Pension adjustment	-	-	-	-	(132)	-
	Tax on pension adjustment	-	-	-	-	43	-
	Share based payments	-	851	-	-	254	-
	Adjusted profit for financial year	7,030	7,881	7,030	5,989	6,154	5,989

	Weighted average number of shares			2008 Number of shares		2007 Number of shares
	For basic earnings per share			21,557,529		20,019,549
	Unexercised share options			455,877		307,010
	For diluted earnings per share			22,013,406		20,326,559
	The Group's earnings per share are as follows:				2008		2007
	- Basic				32.6p		29.9p
	- Diluted				31.9p		29.5p
	- Basic adjusted				36.6p		30.7p
	- Diluted adjusted				35.8p		30.3p

6.	CURRENT TAXATION

The current tax payable of £1,702,000 (2007: £1,319,000) represents the amount of income taxes payable in respect of current and prior year periods.

7.	CHANGES IN SHAREHOLDERS' EQUITY

		Share capital     £000	Share premium account   £000	Capital re-demption reserve £000	Invest-ment in own shares £000	Share based payment reserve £000	Trans-lation reserve   £000	Retained earnings     £000	Total       £000
	At 1 August 2006	200	89	682	(913)	3	73	6,373	6,507
	Total recognised income and expense	-	-	-	-	106	85	6,074	6,265
	Dividends	-	-	-	-	-	-	(1,560)	(1,560)
	Issue of shares in the year and net premium	16	5,275	-	-	-	-	-	5,291
	Investment in own shares	-	-	-	1,083	-	-	-	1,083
	Reserve transfer	-	-	-	(256)	-	-	256	-
	Expense in relation to share-based payments	-	-	-	-	254	-	81	335
	At 31 July 2007	216	5,364	682	(86)	363	158	11,224	17,921
	Total recognised income and expense	-	-	-	-	-	479	6,801	7,280
	Dividends	-	-	-	-	-	-	(1,928)	(1,928)
	Reclassification from net assets	-	-	-	(1,730)	-	-	-	(1,730)
	Investment in own shares	-	-	-	(81)	-	-	-	(81)
	Reserve transfer	-	-	-	17	-	-	(17)	-
	Expense in relation to share based payment	-	-	-	-	815	-	2	817
	At 31 July 2008	216	5,364	682	(1,880)	1,178	637	16,082	22,279

 

STATUS OF FINANCIAL INFORMATION

The preliminary financial information, which comprises the Group income statement, Group statement of recognised income and expense, Group balance sheet, Group cash flow statement and related notes, does not constitute full accounts within the meaning of section 240 of the Companies Act 1985 but is derived from accounts for the years ended 31 July 2008 and 31 July 2007. The audited figures for the year ended 31 July 2007, on which the auditors have issued an unqualified audit report, do not contain a statement under section 237(2) or (3) of the Companies Act 1985. The preliminary announcement is prepared on the same basis as will be adopted in the statutory accounts for the year ended 31 July 2008. 

While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS), as adopted by the European Union (EU) and International Financial Reporting Interpretations Committee ('IFRIC') interpretations and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS, this announcement does not in itself contain sufficient information to comply with IFRSs.

GSH Group plc is incorporated and domiciled in the United Kingdom.

ANNUAL REPORT AND FINANCIAL STATEMENTS

The Annual Report and Financial Statements will be posted to shareholders shortly. Copies of the Annual Report and of this announcement will be available at the Company's registered office: GSH House, Forge Lane, Stoke on Trent, ST1 5PZ and on the company's website http://www.gshgroup.com.

ANNUAL GENERAL MEETING

The Annual General Meeting of the Company will be held at GSH House, Forge Lane, Stoke on Trent, ST1 5PZ on 17 December 2008.

ENDFR FKBKKOBDDKKB

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