| Thu 24 Jan 2008, 12:53 | | BAW / BAWP - Barloworld Limited - Chairman`s Statement |
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BAW BAWP
BAW
BAW / BAWP - Barloworld Limited - Chairman`s Statement
Barloworld Limited
(Incorporated in the Republic of South Africa)
(Registration number 1918/000095/06)
(Share code: BAW)
(ISIN: ZAE000026639)
(Share code: BAWP)
(ISIN: ZAE000026647)
("Barloworld")
CHAIRMAN`S STATEMENT
TRADING UPDATE
The equipment division in southern African territories continues to experience
strong growth in the mining and construction sectors. As global demand has
resulted in extended lead times, we are working proactively with Caterpillar to
meet customer expectations and delivery dates. The order book remains strong and
we expect good performance to continue for this financial year.
In Iberia, we are seeing solid demand for equipment as construction for
infrastructure continues at strong levels and we expect this to balance the
cooling off in the housing sector. There is a slight improvement in the market
in Portugal with an increase in tenders awarded in recent months. The Siberian
business is performing well with revenues continuing to grow strongly.
In the automotive division, passenger vehicle sales in southern Africa remain
under pressure in response to the cumulative impact of high consumer debt,
interest rate increases and the National Credit Act. We expect these tough
conditions to continue in the months ahead. Australian vehicle sales are
exhibiting steady growth with our operations performing well. The car rental
business continues to achieve operating profit targets in southern Africa, while
Scandinavia has entered the quieter winter period. The fleet services business
is showing reasonable growth with improving margins and new fleet contracts
coming into operation.
Our handling business in the US has experienced slowing economic conditions
which are carrying through to the business performance. The UK and European
businesses are showing steady profit growth. While lift truck sales in South
Africa will be lower than last year due to the increased interest rates, we
expect improved results.
Growth in the logistics division is expected to continue through new long-term
agreements with significant local clients.
While global economic conditions are more uncertain, the outlook for the
restructured group remains positive.
STRATEGIC ACTIONS
The disposal of the Laboratory business for GBP75 million was concluded in
December 2007. The Coatings business was successfully listed and unbundled from
the group on 10 December 2007. This was the final step in completing the
strategic actions that were announced at the AGM last year and which unlocked
significant shareholder value.
BEE TRANSACTION
The implementation of our BEE transaction is on schedule to be concluded in the
first half of 2008. This exciting development is expected to deliver significant
benefits to the group. The transaction will be broad-based involving a number of
parties including employees, community and social investment partners, strategic
black equity partners and black non-executive directors.
CHANGES TO THE BOARD
In December 2007, two long serving executive directors, Messrs Brandon Diamond
and Andre Lamprecht retired from the Board. We wish to thank both for their
valuable and distinguished contribution to the group in various capacities over
many years. In respect of our non executive directors, Mr Trevor Munday
resigned on 17 January 2008 and Mr Robert Tomkinson resigned following this
meeting. We extend our appreciation for their distinguished service to the
Board and also for their significant contribution to various board committees.
Mr Gordon Hamilton, a current board member, replaces Mr Tomkinson as chairman of
the Audit Committee and we welcome him to this important role.
24 January 2008
SANDTON
Sponsor: JPMorgan
Date: 24/01/2008 12:40:03 Produced by the JSE SENS Department.
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