Trading Statement
28 October 2003 - 6:00PM
UK Regulatory
RNS Number:3614R
Lavendon Group PLC
28 October 2003
28 October 2003
Lavendon Group plc
("Lavendon" or the "Company")
TRADING UPDATE
Lavendon Group plc, Europe's market leader in the rental of powered access,
today issues the following trading update as it approaches the end of the
traditionally busiest period of its trading year.
The Group's interim results statement on 2 September 2003 noted caution
regarding prospects for the remainder of the year. Although demand levels
continued to increase from the summer months, the rate of increase has been less
than anticipated in our main markets of the UK and Germany. Given these more
difficult trading conditions, management focus has centred on controlling costs,
generating free cash and reducing debt levels.
In the UK, activity in the commercial/industrial construction, manufacturing and
telecommunications sectors has remained subdued, and is currently below that of
last year, resulting in a year on year revenue decline, to date, of some 4%,
with consequential pressure on margins.
Demand levels in Germany have continued to be depressed, which has caused a
decline in year on year activity levels. However, the effect of this reduced
demand is now partly being offset by an improvement in hire rates, which has had
the effect of limiting the revenue decline to 5% over the previous year in the
period to mid-October.
The Group's other European operations are together showing year on year revenue
growth and an improving trend in profitability across the year. In the Middle
East, growth in both revenues and margins are substantial and this is expected
to continue for the remainder of this year.
Whilst the performance of our operations in the UK and Germany has not met
expectations during recent weeks, which will have a significant effect on the
overall profitability of the Group for the year, strong cashflows continue to be
generated, allowing the Group to reduce debt levels month by month. The strength
of these cashflows provides considerable comfort against short-term market
uncertainties.
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For further information please contact:
Lavendon Group plc 01455 206 736
David Price, Chairman
Alan Merrell, Finance Director
Weber Shandwick Square Mile 020 7067 0700
Peter Corbin / Nick Dibden
This information is provided by RNS
The company news service from the London Stock Exchange
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