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Trading Update

30th Jun 2011 07:00

RNS Number : 4025J
Berendsen PLC
30 June 2011
 



 

 

30 June 2011

 

Berendsen plc

 

Trading Update

 

The Board of Berendsen plc ("the Group") issues the following statement before entering its close period for the half year ending 30 June 2011 and prior to its Interim Results announcement, which will be issued on 26 August 2011.

 

Current Trading

 

The positive trends for the first three months of the current year outlined in the April 2011 Interim Management Statement have continued. At an underlying organic level, revenue growth in the period continued at 2%, with the encouraging improvement in operating margin achieved in the first quarter being maintained throughout the six months. The Group's strong cash flow lowered the interest cost in the first half which, combined with the increase in operating profit, resulted in a good underlying increase in profit before tax over the previous year.

 

At a reported level, comparisons of operating profit performance to the equivalent period last year reflect the benefit of provisioning at the end of 2010 against the estimated future losses on decontamination contracts (£2.5 million loss in the first half of 2010) and a modest net benefit, which is expected to reverse in the second half, following the sale of Björnkläder (the Swedish direct sales business) and the acquisition of the ISS washroom activities in Denmark, Sweden and Norway.

 

Continental Europe as a whole showed a better than expected performance, with Holland also now delivering growth and margin improvement and the benefits of restructuring the German Healthcare operation starting to materialise. Within the Nordic region, Sweden continued to perform strongly with more positive signs of the market in Denmark improving. We saw modest revenue growth in the UK textile business.

 

The momentum of our Strategic Review initiatives continues to build and, in the course of the last three months, we have finalised appointments to key positions and made an encouraging start on our capital efficiency initiatives.

 

The Group continues to generate a strong free cash flow and this is expected to reflect positively in the net debt position at the end of the first half of the year.

 

Summary and Outlook

 

The Group will deliver a good underlying first half performance, with reported profit before tax expected to be significantly ahead of the same period last year.

 

The Board anticipates a continuation of the current trading trends into the second half of 2011. Our medium to longer term ambitions for the Group remain in place as the benefits of various Strategic Review initiatives are achieved.

 

For further information contact:

 

Berendsen plc

Financial Dynamics

Peter Ventress, Chief Executive

Richard Mountain

Kevin Quinn, Finance Director

Telephone 020 7269 7291

Telephone 020 7259 6663

 

 

 

 

 

Note:

1. Berendsen plc 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.

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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