BIL brambles industries limited

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    Trading Update for the 11 months to May 2003

    BRAMBLES INDUSTRIES LIMITED 2003-06-25 ASX-SIGNAL-G

    HOMEX - Sydney

    +++++++++++++++++++++++++
    TRADING UPDATE FOR THE 11 MONTHS TO MAY 2003

    Brambles has previously announced that it will issue regular trading
    updates ahead of its interim and final results. Today's update
    comments on year-to-date performance in the current financial year
    ending 30 June 2003. The full year results will be announced on 2
    September 2003.

    INTRODUCTION

    At the time of its last interim results, Brambles reported on the
    improving performance of CHEP in the Americas, the challenges of CHEP
    Europe, the impact of the container deposit directive on Cleanaway in
    Germany and the continuing growth of Recall. Since then, Brambles has
    continued to see good revenue growth rates in most businesses, and is
    making steady progress on the CHEP Europe re-organisation plan.

    The Groups full year results will be within the current range of
    market forecasts. At present, the range of market forecasts in the UK
    (calculated as profit before tax, goodwill amortisation and all
    exceptional items PBTA) is between 275 million and 308 million.
    In Australia the PBTA range is between A$742 million and A$830
    million. Based on trading for the 11 months to 31 May 2003, we would
    expect the final result in constant currency for the year to 30 June
    2003 to be around the middle of the range in Australia and a little
    below midway in the UK. The adverse impact of exchange rates on the
    translation of profits into Australian dollars is estimated at A$16
    million.

    Operating cash flow is improving, with better working capital
    performance and capital expenditure has been reduced.

    All the information in this trading update which relates to relative
    performance refers to movements in constant currency.

    CHEP

    Europe

    Revenue in CHEP Europe for the 11 months to the end of May was more
    than 6% higher than the same period last year, with contract gains
    over the past five months being realised as expected. This compares
    with an increase of 4% in the first 6 months.

    It is one of CHEPs key objectives to provide reliable and efficient
    services to its customers, and to align services and pricing more
    closely with customer activity and costs. Commercial initiatives in
    this regard have already commenced and further developments are
    planned in the coming months. CHEP will continue its efforts to
    improve service quality and to ensure that it continues to represent
    the most efficient option for its customers.

    The implementation of the pan-European reorganisation in CHEP Europe
    is proceeding to plan. Consultation with all the relevant Works
    Councils is proceeding well and the centralisation of finance and
    administrative processes into Spain and the UK is expected to be
    completed within the next financial year. The rationalisation of the
    workforce had resulted in a net reduction of approximately 100
    employees by the end of May. The reduction is expected to be fully
    implemented by the end of June 2004, when the workforce will have
    been reduced by between 300 and 400 employees.

    CHEP Europes efforts to improve asset productivity are also
    beginning to yield results, though the process is still at an early
    stage.

    AMERICAS

    CHEP Americas revenue growth for the full year is expected to be
    around 11%. This is based on the 11 months to 31 May 2003, which
    continued to see strong growth in Latin America. A lower rate of
    growth in the USA, principally in the last quarter, resulted from
    softer demand in the retail market, mainly of non-food products.

    In CHEP USA, the implementation of the five key performance
    improvement initiatives continues to bring benefits, particularly in
    reduced transportation costs and the management of its NPD
    (non-participating distributor) channel.

    The project to consolidate service centres in CHEP USA is almost
    complete with 75 new service centres in operation. As a result, CHEP
    has made further efforts to improve pallet quality, and hence
    increase customer satisfaction. The additional cost of maintaining
    this higher pallet quality is around 9 million (A$23 million) in the
    current financial year, with a greater proportion incurred in the
    second half. Costs running at this higher level are expected to be
    ongoing.

    REST OF THE WORLD


    In Australia, Asia and Africa, revenue was up by 14% in the 11 months
    to 31 May and all regions are performing well.

    CLEANAWAY

    Despite challenges in European markets, Cleanaway is continuing to
    perform steadily and generate a strong cash flow. Based on the 11
    months to 31 May, revenue growth for the full year in Cleanaways
    continuing businesses is expected to be approximately 4%.

    In the UK, a robust performance in dry waste is being offset by
    pressures in technical waste. In Germany, the business is continuing
    to perform in line with expectations notwithstanding economic
    conditions and the impact of the new container deposit directive.

    Looking forward in Germany, the outcome of the re-tendering process
    for the packaging recycling scheme DSD will not be known until
    later in the calendar year, although as previously mentioned, profit
    contraction must be anticipated in 2004.

    Cleanaway Australia continues to make good profit progress, in line
    with our expectations.

    RECALL

    Recall is continuing to perform strongly, with revenue growth in the
    11 months to 31 May of around 17%. The organic growth rate has
    strengthened over the last five months and is now above the 7% seen
    in the first half. Acquisitions particularly those in US, UK and
    Sweden have also contributed to the strong performance.

    BRAMBLES INDUSTRIAL SERVICES AND REGIONAL BUSINESSES

    Revenue in Brambles Industrial Services in the 11 months to 31 May
    was similar to last year. The division is performing as expected,
    with Australia remaining strong.

    In our Regional Businesses, Interlake continued to trade below last
    year in the 11 months to the end of May given general economic
    conditions. The manufacturing base of Interlake is currently being
    further restructured to reduce cost.

    Notes

    (a) The ranges of market forecasts shown above include all those
    known to Brambles, representing a total of 18 brokers.

    (b) The currency effect on the results reported in Australian Dollars
    is due to the movements against the Pound Sterling, US Dollar and US
    Dollar related currencies, particularly the Mexican Peso, Brazilian
    Real and Canadian Dollar.

    (c) Relative performance measures in this trading update are shown in
    constant currency. Constant currency is calculated by translating
    foreign currency results at the average exchange rates applicable to
    the 12 months to 30 June 2002.


    Brambles Industries is globally headquartered in Australia
    For further information, contact

    AUSTRALIA

    Investor John Hobson, Head of Investor Relations +61 (0) 2 9256 5216
    +61 (0) 414 239 188 (mobile)
    Media Jeannette McLoughlin +61 (0) 2 9256 5255
    Group General Manager Corporate Communications
    +61 (0) 401 990 425 (mobile)

    UK

    Investor Sue Scholes, Head of Investor Relations +44 (0) 20 7659 6012
    Media Richard Mountain, Financial Dynamics +44 (0) 20 7269 7291

    NOTES

    Brambles is a leading global support services provider with
    operations in more than 50 countries across Europe, the Americas,
    Asia-Pacific and Africa. With full year 2002 turnover of
    approximately A$8.45 billion / 3 billion, operating profit of more
    than A$1,127 million / 400 million and assets of A$10.42 billion /
    3.7 billion, it employs some 31,000 personnel worldwide. Its key
    global businesses are CHEP, CLEANAWAY and RECALL.

    CHEP is the worlds pioneer and leader in the provision of pallet
    pooling services. CHEP pallets facilitate the efficient operation of
    supply chains for most of the developed worlds leading international
    FMCG (Fast Moving Consumer Goods) companies. These companies require
    the fast availability of high quality pallets and other types of
    standard loading equipment and transit packaging wherever they
    operate. CHEP meets this need through its global reach and scale,
    combined with its proven logistics and supply chain management
    capability and its established pallet pools and infrastructure in 40
    countries.

    CLEANAWAY is a leader in the collection, sorting, recycling,
    transfer and disposal of waste, particularly in UK, Germany and
    Australia. Through Cleanaway Germany, it is one of the largest paper
    recycling and trading businesses in Europe.

    RECALL is a global business managing physical and digital documents
    through their entire life cycle.

    It also has a number of other global and regional businesses, such as
    Industrial Services, Meineke Car Care Centers and Interlake Material
    Handling.

 
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