BRAM Brammer

TIDMBRAM

RNS Number : 2622R

Brammer PLC

16 November 2012

PRESS RELEASE

FOR RELEASE 07.00 16 November 2012

Brammer plc

Interim Management Statement

Brammer plc, Europe's leading distributor of quality industrial maintenance, repair and overhaul products ("MRO"), today issues its Interim Management Statement for the period from 1 July 2012 to date.

Key Highlights

   --     Trading in the period in line with management's expectations 

-- Buck & Hickman integration, synergy benefits, and cross selling of tools and general maintenance products on track

-- Focus on Key Accounts, Insites(TM) and cross-selling underpins significant market share gains

-- 8 pan-European Key Accounts won, making 13 in the year to date with total potential revenues in excess of EUR80 million per annum

-- Gross margin (excluding Buck & Hickman) up 130 basis points July to October, and up 140 basis points year to date

   --     Cash flow and net debt remain in line with expectations 

Trading

The Board of Brammer is pleased to report that trading in the four month period from 1 July 2012 has been resilient in the face of difficult macroeconomic conditions and continues to reflect significant market share gains as customers increasingly realise the benefits of using a single source MRO supplier.

During the four month period, which included one month of Buck & Hickman in 2011, sales growth including Buck & Hickman was 16%. Sales were ahead 1.2% when including only the incremental growth associated with Buck & Hickman, whilst sales per working day ("SPWD"), at constant currency rates were flat versus the same period last year. SPWD were 1.4% lower in the UK (excluding Buck & Hickman), down 2.4% in Germany, up 1.5% in France, flat in Spain, ahead 4.7% in the Benelux, and down 11.4% in the rest of Europe. Organic SPWD growth for the 10 months to 31 October was 3.8%.

The integration of Buck & Hickman continues on plan and the associated synergy benefits are being achieved. Our cross-selling initiatives throughout the four month period have continued to deliver satisfactory results with fluid power up 5.5% and tools and general maintenance (excluding Buck & Hickman) 17.7% higher. Bearing sales were 11% lower reflecting the difficult market conditions, whilst overall non-bearing sales (excluding Buck & Hickman) were up 3.5%.

Key Account sales in constant currency terms were up 8.5% overall during the four month period with good growth in food and beverage (up 16.1%), metals (up 12.3%), and fast moving consumer goods (up 15.4%). Automotive sales were up just 1.2%. A further 8 pan-European Key Accounts were won in the period making 13 in the year to date, with total potential incremental revenues exceeding EUR80 million per annum.

Gross profit margins for the July to October period, excluding Buck & Hickman, have risen by 130 basis points, whilst including Buck & Hickman gross margins are up 20 basis points. We have made significant cost savings in the fourth quarter, removing from our sales, distribution and administrative expense an annualised GBP5.3 million, for which we will take an exceptional charge of approximately GBP2.7 million. Cash flow and net debt remain in line with our expectations.

Outlook

Recent trends have continued and sales in the first two weeks of November have been in line with expectations. While the European economic outlook remains uncertain, our strategy of focusing on Key Accounts, Insites(TM) and cross-selling initiatives underpins the growth momentum driving profitable market share gains for the medium and longer term. As a result we remain confident in the outturn for the year as a whole and expect to continue to outperform the market.

 
 Enquiries:       Brammer plc                      +44 (0) 161 902 5572 
 
  Bill Whiteley, Chairman 
  Ian R Fraser, Chief Executive 
  Paul Thwaite, Group Finance 
   Director 
 
 
 
 
 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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