24 July 2008
AGM Statement and IMS, July 2008
At today's Annual General Meeting, Wincanton, the leading European supply chain solutions provider, is issuing the following statement, which includes its first Interim Management Statement covering the Group's performance from the beginning of the current financial year:
The year to 31 March 2008 was another year of strong profit growth and good cashflow generation for Wincanton, confirming the Group's track record of consistently adding value for shareholders. This has allowed your Board to recommend a 10 per cent increase in the annual dividend.
Wincanton's profit growth is now generated across an increasingly diversified portfolio of services, sectors and geographies, supported by a strong contract base in our core UK market and excellent relationships with our blue-chip customers across the Group.
Our track record of consistent growth in profits and dividends has been built on a combination of organic development and sensibly-priced, well-integrated acquisitions, both in existing markets and in new sectors and services. We continue to see attractive opportunities for further growth through acquisition with a number of acquisition and joint venture opportunities currently under review.
UK & Ireland
The high levels of operational start-ups and new business activity that delivered a year of strong financial performance in 2007/2008 have continued in the first quarter of the new financial year.
In the current year, our Retail business unit has already brought onstream some 1.5m sq ft of new space for customers. The pipeline for our Manufacturing business unit is being reinforced by our recent acquisitions and we remain encouraged by the growth prospects of our new Emerging Solutions business unit.
At the end of May we announced the acquisition of Product Support Holdings Ltd, a leading provider of logistics solutions to the defence and aerospace markets, primarily in the UK, for up to £30m. This acquisition provides an entry into new markets, further broadens our business base and provides the opportunity for incremental growth in the medium and longer term.
The improving profitability of our Mainland European activities gives grounds for initial encouragement.
We are seeing an above budget performance from our German road network, we have added new business with existing customers in France, and in Central & Eastern Europe we have extended our consultancy work for a major brewer with new assignments in the Czech Republic and Hungary.
We remain committed to the delivery of margin improvement in Mainland Europe. Our strengthened management teams, and the performance improvement plans they are implementing, are establishing a more efficient, more profitable business base from which we can seek to grow more consistently in the future. The pace of continuing progress towards our target, given that we are currently on track to enhance the profitability of our current activities, will increasingly depend upon our ability to deliver higher levels of new, topline growth.
We expect the new financial year to be challenging. The economic slowdown will inevitably affect certain of our customers and their markets, and those of our activities which are more volume-related. We are confident, however, that the portfolio effect of our diverse, substantially contract-based business model will nonetheless enable the Group to continue to make progress.
Our interest charge in the year will reflect the approximately £60m of incremental debt arising from recent acquisitions and the effects of higher pensions costs.
We currently expect the Group to deliver another period of growth for shareholders in the year to 31 March 2009, with continuing progress towards our medium and longer-term financial and strategic objectives.
As previously announced, following seven years on the Board, including three as Chairman, David Malpas will today retire from the Board. David Edmonds takes up the role of Chairman and Philip Cox has been appointed Senior Independent Director. There are a number of other changes to various Board Committees, details of which are set out in an appendix to this announcement.
The company wishes to thank David Malpas for his significant contribution to the successful development of Wincanton during his time on the Board."
Graeme McFaull, Chief Executive
Gerard Connell, Group Finance Director
+44 (0)1249 710 000
+44 (0)207 466 5000
Changes to the Board Committees
In addition, Philip Cox will become Chairman of the Remuneration Committee and Jonson Cox will replace him as Chairman of the Audit Committee. David Edmonds becomes Chairman of the Nomination Committee and Philip Cox will be appointed as a member of the Nomination Committee. These changes all take effect today.
Following these changes, the members of the Committees are as follows:
David Edmonds - Chairman
Philip Cox - Chairman
Jonson Cox - Chairman
There are no further disclosures pursuant to paragraphs 9.6.13(1) to 9.6.13(6) of the Listing Rules.