| Mon 16 Feb 2004, 9:21 | | BIDVEST GROUP LIMITED - PRESS RELEASE |
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BIDVEST GROUP LIMITED - PRESS RELEASE
BIDCORP PLC
Bidvest Group Limited
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 1946/021180/06)
SHARE CODE: BVT ISIN: ZAE000050449
("BIDVEST")
MARGIN PRESSURE SQUEEZES BIDCORP PLC
TOUGH trading conditions and intense pressure on margins produced an operating
loss from continuing operations of GBP1.6 million for the six months to December
31 2003 for Bidcorp plc, Bidvest"s 57% owned London Stock Exchange-listed
subsidiary which provides services to the automotive, shipping and property
sectors.
This loss compares with a profit of GBP0.6 million for the previous comparable
period.
Turnover from continuing operations declined 1% to GBP64.4 million. Capacity on
additional sailings added to the Dartline ferry service was insufficiently taken
up, and contracted rates for Volume Transport reduced significantly.
A positive feature of the results was that net gearing remained constant at 27%.
Hire purchase debt of GBP3.0 million was repaid during the period.
Turnover from the Automotive division"s continuing operations declined 8% to
GBP41.8 million, resulting in an operating loss of GBP0.9 million. (2002: break-
even).
Shipping and Ports reported a 14% increase in turnover to GBP20.4 million, but
the heavy costs associated with establishing expanded sailing schedules resulted
in an operating loss of GBP0.8 million. Sailings have since been curtailed and
turnover and costs will reduce correspondingly in the next period. This division
operates a fleet of six ferries under the Dartline brand, offering scheduled
sailings between the Bidcorp-owned port at Dartford on the Thames and the
European ports of Zeebrugge (Belgium), Vlissingen (Holland) and Dunkerque
(France).
Property and Outsourced Services is the smallest of the group"s three divisions,
and manages and develops investment property on behalf of the group as well as
third parties.
The Automotive division"s main business is the volume distribution of vehicles
throughout the UK and continental Europe, repatriation of vehicles from mainland
Europe, vehicle refurbishment and pre-delivery inspections, specialist delivery
services and niche marketing and promotional services to the automotive
industry. The group also operates the UK"s largest rescue and recovery operation
outside the motoring clubs, under the Ontime Rescue and Recovery brand. Its
Traffic Management business provides a vehicle clamping and removal service to
local borough councils.
The Volume Distribution business in the UK is particularly competitive, the
result of pressure from manufacturers and excess transport capacity. Though this
unit reported losses for the period, a substantial investment in new fleet
combined with business restructuring has created a stronger platform for
operational improvement.
The Automotive businesses have been rationalised from three into two operating
divisions: the Specialist Transport, Vehicle Preparation, Prestige Vehicle
Distribution and Promotional Support businesses have been merged with Rescue &
Recovery and Traffic Management into Ontime Specialist Automotive Services.
The Rescue and Recovery business, which is highly weather-dependent, attended to
100,000 call-outs during the six-month period and is performing to expectations.
A reduction in promotional activities within the automotive sector had a
negative impact on Specialist Transport and Prestige Vehicle Distribution.
Traffic Management performed below expectations, though corrective action has
been taken by management.
Despite poor results from Shipping and Ports, management and staff have improved
the service to customers as well as client perceptions of Dartline. New sales
initiatives will be directed at balancing capacities and cargoes and extending
the sales footprint to several new centres across Europe. "The focus for the
rest of the financial year will be on maximising returns on our established
routes," says Chief Executive Rodger Graham.
The Property and Outsourced Services division showed favourable results which
included the sale of a property in Kent to a developer. Lower car parking
turnover at its facilities were experienced as a result of the levying of the
Central London congestion charge.
Chairman Brian Joffe said though the results for the period are disappointing,
fixed overheads have been reduced significantly throughout the group. Emphasis
is now on operating efficiencies, increased capacity utilisation and greater
turnover.
No dividend has been declared for the period.
Issued on behalf of: The Bidvest Group Limited
By: Cleardistinction Communications
Bidvest Contracts: Brian Joffe (Chairman)
Tel: + 27 (0) 11 772-8704
David Cleasby (Investor Relations)
Tel : +27 (0) 11 772 8706
Bidcorp Contacts: Rodger Graham (Chief Executive)
Tel: + 44 (0) 20 7408 0123
Consultancy Contact: Carol Dundas
Tel: +27 (0) 11 444-0650
Mobile: +27 (0) 83 447-6648
Date: 16/02/2004 09:10:04 AM Produced by the JSE SENS Department
