AGA.L Regulatory News (AGA)

7 Jul 2005 07:01

AGA Foodservice Group PLC07 July 2005 7th July 2005FOR IMMEDIATE RELEASE AGA FOODSERVICE GROUP PLC - PRE-CLOSE INTERIM TRADING UPDATE In line with market practice, Aga Foodservice Group (Aga) is issuing its regulartrading update, ahead of its close period prior to its interim results for thehalf year ended 30th June 2005, which will be announced on 9th September 2005. Overview The Group performed well in the first half of the year. The consumer markets areclearly slower than a year ago and the growth achieved by Aga and Rangemasterwas particularly commendable. In contrast, investment levels are rising incommercial markets. Overall, the first half of 2005 will be in line withexpectations and up on the half year 2004 IFRS pre-tax profit of £15.5 million.Expectations for the remainder of the year should also be met. Consumer Within Consumer, although the housing market is quiet and consumers cautious,Aga had another record first half. The new electric and 3-oven Agas helped tosustain momentum. UK volumes were level with overseas markets growing andexports reached close to 25% out of sales of 6,200 cookers. Rangemaster, theinventor of the original range cooker, this year celebrated its 175thanniversary with the launch of a new generation of the Victorian 'Kitchener'cooker. Rangemaster continues to increase market share in the UK and is growingwell overseas. The home fashions retail operations, Fired Earth in the UK andDomain in the US, saw sales down 5% and unchanged, respectively, but are nowobtaining sales benefits from being part of the Group through enhanced productofferings and customer referrals. Domain's margins are also reflecting thebenefits of sourcing from Asia. Marvel, the US refrigeration business, had agood first half. Foodservice In Foodservice, after a relatively slow start to the year our Aga Bakeryoperations saw a distinct pick up in orders at the end of the period. The Frenchartisan bread market, a key market for Aga Bakery, is up year on year and someof the international supermarket chains are indicating more ambitious investmentprogrammes. Having a single European structure for our bakery business isbringing product and production benefits. In the US, further inroads were madeinto the bakery markets - with doughnut equipment sales again being strong. In Refrigeration the first half was very strong in the UK and also strong inChina and Australia. In the US volumes were up, but margins remain underpressure. Sales of our new revolutionary Infinity Fryer are growing. Research findingsshow that overcooked food can contain toxins that are health hazards, andcontrolling contamination is set to become a major issue for the foodservicesector. With its push-button in-built filtration, Infinity helps to controlprocess contamination. Strategic Investments The Group remained in a cash positive position at the end of the period showingthere is continuing scope for strategic investments; the Group will continue totake opportunities to strengthen its operations by acquiring complementarybusinesses with the ability to bring new opportunities to existing operations.This has been seen with the recent acquisition of Waterford Stanley, the Irishcooker operation acquired for up to Euros 13.8 million and the increasedshareholding in Grange, the French international furniture group, from 40.7% to75.0% for Euros 7.5 million. IFRS Prior to the interim results announcement, the Group will issue a restatement ofits 2004 results under IFRS. The half year IFRS pre-tax profit for 2004 isexpected to be £15.5 million compared with £12.7 million under UK GAAP. Theprincipal adjustments are to add back goodwill amortisation of £4.0 million andto deduct a pension charge of £1.2 million. -ENDS-Enquiries:William McGrath, Chief Executive, Aga Foodservice Group plc 0121 711 6015Jonathan Glass/Simon Sporborg, Brunswick 020 7404 5959 This information is provided by RNS The company news service from the London Stock Exchange