12th Jul 2007 07:00
Ricardo PLC12 July 2007 12th July 2007 Ricardo plc Trading Statement Ricardo plc is the leading UK independent automotive consultancy, employing over1,800 people. The company has centres in the UK, USA, Germany, Czech Republicand Asia and the client list includes the world's major automotive OEMs. 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 2007. Ricardo willannounce its Preliminary Results on Monday 17th September 2007. Since the announcement of our interim results in March, overall trading for thesecond half has been in line with our expectations, with further order bookgrowth and improving performances across all divisions. The order book hasincreased from £78m at the half year to over £85m at the end of June with a goodbalance across all our engineering consultancy divisions. This comparesfavourably to an order book of £72m at the end of the last financial year. Netdebt levels have halved since the half year position. In addition to our US and European order growth, we have secured a number ofopportunities from Asia, particularly from Japan. We are also experiencingsignificant growth in India and good contribution from China. The pipeline ofprospects from Asia continues to grow and we are pleased to also welcomeadditional business from Russia as a new developing region. Our UK business has had a strong second half with an increasing demand fordiesel projects. As planned, SAIC Motor Company Ltd exercised their option totake ownership of Ricardo 2010 to further develop their engineering ability fortheir home market. We have agreed with SAIC that they will continue to have asignificant presence at our Leamington site and our broader business relationswith them continues to strengthen. In Germany, performance in the second half has been in line with expectations.Underlying business improvement, customer development and successful recruitmentto strengthen the high quality team have ensured that the pipeline of prospectsis particularly strong and growing. Following a disappointing first half trading performance in North America, theunderlying trading before restructuring costs has improved in the second half onthe back of a strong order book. The senior management team was strengthened bythe appointment of Dean Harlow in May 2007 as President of the North Americansubsidiary, to provide improved entrepreneurial leadership and further broadenthe business. Strategic Consulting has been successful in achieving its focus of furtherdeveloping and building a more robust global client base. Second halfutilisation levels have increased on the back of a more buoyant market and wecontinue to invest and recruit to support sustainable business growth. Our pensions deficit is expected to reduce following a year of better thanexpected returns from equities and an improved bond yield and planned companycontributions, although this will be offset in part by a revision to mortalityassumption. Accelerated benefit from Research and Development tax allowances is expected tolead to an overall tax credit this financial year. Overall, despite the costs of structural change in America, trading is envisagedto be in line with our expectations. Our order book has continued to grow as wehave successfully broadened our customer and geographic base. We are increasingthe rate of investment in people and facilities and are confident of furthersteady progress in the new financial year. Enquiries: Ricardo plc Tel: 01273 455611Dave Shemmans, Chief ExecutivePaula Bell, Group Finance Directorwww.ricardo.com Gavin Anderson & Company Tel: 020 7554 1400Fergus Wylie/Daniel Hunter This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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