ARL.L Regulatory News (ARL)

25 Sep 2006 07:04

SMC Group Plc25 September 2006 SMC Group Plc SMC expands into Scotland with four acquisitions Announces acquisition to target Prison sector SMC Scotland SMC Group Plc, a leading group of architects and designers, announces its entryinto the Scottish market through the acquisition of four establishedarchitectural businesses and the subsequent formation of SMC Scotland. Thisestablishes SMC as the largest group of architects in Scotland. The combined initial payments for the four businesses total £10.7 million. Ineach case deferred consideration is payable in a combination of cash andshares based on performance over the next three years and a 5x earnings multiple(subject to caps). They have a combined revenue of £13.0 million and normalisedprofit before tax of £2.9 million. Highlights: •Entry to the Scottish market via. four acquisitions that immediately establish SMC Scotland as number one in the market with 227 employees and 81 qualified Architects. •Parr Architects - based in three major Scottish cities and established for 50 years. Turnover of £4.5 million, normalised PBT of £0.9 million, initial consideration of £3 million. Clients include BAA and Pacific Quay Develoments. •Jenkins & Marr - based in three major Scottish cities and established since 1879. Turnover of £4.1 million, normalised PBT of £1 million, initial consideration of £3.8 million. Clients include BP and Sainsbury's. •Davis Duncan - based in Glasgow, the Highlands and London. Forecast turnover of £3.3 million, normalised PBT of £0.7 million, initial consideration of £2.7 million. Clients include the Next Group, The Bank of Scotland and Canon UK. •Hugh Martin Architects - based in Edinburgh established in 1969. Turnover of £1.1 million, normalised PBT of £0.3 million, initial consideration of £1.2 million. Clients include Premier Property Group, Gleneagles Hotel and Frogmore Develoments. •Acquisitions will be funded through the Group's banking facility with Bank of Scotland. SMC Hickton Madeley SMC has also acquired Hickton Madeley, a Midlands based business with specificexperience in the Public sector, including Prisons. The Prisons sector is onethat has been targeted as a growth market and is not currently served by any ofthe existing SMC Group companies. Hickton Madeley has circa 20% of its work inthe custodial sector with the rest spread across a range of sectors. Theacquisition also further expands the Group's activities in the Midlands. The initial consideration will be £1.0 million. Hickton Madeley generatedrevenue of £2.5 million and normalised PBT of £0.5 million in the last fullaccounting year. Hickton Madeley was established in 1936. It has 36 employees, 13 of which arequalified architects. Clients include The Prison Service and they have a 5-yearextendable Term Commission with Birmingham City Council.Commenting on the deals, Chief Executive Stewart McColl said: "We are delighted to make such an emphatic move into the Scottish market. Thisis consistent with our strategy of taking a balanced approach to growth as theseacquisitions enhance our geographic and sector coverage. All of these deals willbe earnings enhancing in the current financial year and firmly establish SMC asthe number one architect and design business in Scotland. In addition, we arepleased to enter the prisons sector through the addition of Hickton Madeley.This is a growth sector of the market and adds to the depth and breadth of ourservice offering" For further information please contact: SMC Group Plc Tel: +44 (0)20 7495 5335Stewart McColl Numis Securities Tel: +44 (0)20 7776 1500Michael Rowan/Jag Mundi Bell Pottinger Corporate & Financial Tel: +44 (0)20 7861 3232David Rydell/Geoff Callow/Chris Hamilton________________________________________________________________________ SMC Group Plc, a leading group of architects and designers, announces its entryto the Scottish market through the acquisition of four established architecturalbusinesses and the subsequent formation of SMC Scotland. This establishes SMC asthe largest group of architects in Scotland. The combined initial payments for the four businesses total £10.7 million. Ineach case deferred consideration is payable in a combination of cash andshares based on performance over the next three years and a 5x earnings multiple(subject to caps). They have a combined revenue of £13.4 million and normalisedprofit before tax of £2.9 million for the last full accounting year of eachbusiness. The companies acquired are Parr Architects, Jenkins & Marr, Davis Duncan andHugh Martin Architects. SMC Scotland will employ a total of 227 people with 81qualified architects, which takes the total headcount in the SMC Group to 705employees. SMC has also acquired Hickton Madeley, a Midlands based business with specificexperience in the Public sector, including Prisons. The Prisons sector is onethat has been targeted as a growth market and is not currently served by any ofthe existing SMC Group Companies. Hickton Madeley has circa 20% of its work inthe custodial sector with the rest spread across a range of sectors. Theacquisition also further expands the Group's activities in the Midlands. The initial consideration will be £1.0 million. Hickton Madeley generatedrevenue of £2.6 million and normalised profit before tax of £0.5 million in thelast full accounting year. Hickton Madeley was established in 1936. It has 36 employees, 13 of which arequalified architects. Clients include The Prison Service and they have a 5-yearextendable Term Commission with Birmingham City Council. The transactions will be funded through the companies banking facility with Bankof Scotland. Details of the companies: Parr ArchitectsOne of the largest architectural businesses in Scotland. Established for over 50years. Experience across a wide variety of sectors including; offices,residential, leisure, education and industrial, providing masterplanning,architecture and interior design throughout the UK and mainland Europe fromoffices in Scotland and England. Clients include; BAA, Birmingham International Airport, City of EdinburghCouncil, Hochtief Developments, Pacific Quay Developments, Borders College andthe University of Abertay in Dundee. Turnover of £4.5 million, normalised PBT of £0.9 million, initial considerationof £3 million. Jenkins & MarrA significant architectural business with offices across Scotland and in London.Established in 1879, and now specialising in architecture, town planning, spaceplanning and project management. The business also includes a facilitiesmanagement team advising on PFI/PPP procurement. It is working on residential, retail, offices, industrial, education and leisureprojects with clients including; BP, Sainsbury's, Teesland, Clydesdale Bank,Aberdeen City Council, Clydebank College and Allied Distilleries. Turnover of £4.4 million, normalised PBT of £1 million, initial consideration of£3.8 million. Davis DuncanAn architecture, interiors and urban design business based in Glasgow, theHighlands and London. It services the residential, offices, retail, industrial,commercial, healthcare and ecclesiastical sectors. Clients include; Next, Bank of Scotland, Canon UK, Kenmore Developments, PremierBurrell Universities of Glasgow, Edinburgh and Caledonian and the NHS. Turnover of £3.3 million, normalised, PBT of £0.7 million, initial considerationof £2.7 million. Hugh Martin ArchitectsAn Edinburgh based architecture business founded in 1969 with town planning andinterior design skills servicing the retail, residential, office and leisuresectors. Clients include; Guardian Properties, Knightsbridge Ltd, Gleneagles Hotel,Capital Shopping Centres and Marks & Spencer. Turnover of £1.2 million, normalised PBT of £0.3 million, initial considerationof £1.2 million. Hickton MadeleyArchitecture, interior and graphic design business established in 1936, based inTelford and Birmingham and working in the office, leisure, industrial, retail,healthcare and custodial sectors, offering urban design and town planningservices mainly around the Midlands and Central England. Clients include; The Prison Service, Birmingham City Council Aston University,DSS Estates, English Partnerships, Miller, Mansell, Norwest Holst, St. ModwenProperties, Sutton Coldfield College and Wellington District & Cottage Hospital. Turnover of £2.6 million, normalised PBT of £0.5 million, initial considerationof £1.0 million. - ends - Notes to Editors SMC Group Plc is the holding company for a group of architects and designers. Ithas established expertise in a broad range of sectors, including residential,retail, industrial, workplace, transportation, leisure and education. On the 30th May 2006, the Group announced the acquisition of The CharterPartnership Ltd (trading as Charter Consultant Architects) an architecture anddesign company with offices in London, Bedford, Bournemouth and Ipswich. Thisfollowed the acquisition of Alsop in March 2006. Following the acquisitionsreferred to above, the Group now has operating company representation in 20towns and cities throughout England and Scotland and 4 outside of the UK, inToronto, Singapore, Shanghai and Beijing. The Company's core strategy is to create an architectural group with the scaleand expertise to access the most profitable schemes across a range of sectorsand geographical locations. The Group intends to focus on its organic growth,increasing its share of the UK market and securing larger, higher marginprojects. The Group plans to continue to complement this organic growth withearnings-enhancing acquisitions in order to consolidate its geographic andsector coverage. On 30th August 2006 the Group announced interim figures for the six months ended30th June 2006, showing that turnover had grown by 108% to £11.5m, profit beforetax grown by 42% to £1.6m and EBITDA increased by 77% to £2.6m. This information is provided by RNS The company news service from the London Stock Exchange