24 Jun 2009 07:00
24 June 2009
Archial Group Plc
AGM Trading Update
Archial Group Plc ("Archial" or the "Group") (ARL.L), the architects and design business, will hold its AGM today. At the AGM, Sir Rodney Walker, Non-Executive Chairman, will provide the following update regarding the Company's current trading.
The decisive action taken in 2007 to deal with the problems facing the Group resulted in a positive outcome for FY 2008, during which we delivered an EBITDA profit of £6.5m. Since mid 2007 a total of £4.7m annualised cost reductions have been achieved.
As has been widely reported, the unprecedented economic downturn in the building and construction industry has inevitably had an impact on the architectural sector. Despite starting the year with a strong portfolio of future work, Archial has not been immune from the effects of the downturn. As an example, the change in funding of public works announced in the spring budget has led to a number of instructed projects been either delayed or cancelled.
Despite the current trading environment we have achieved a net revenue of £15.1m in the first 5 months of 2009 and we have succeeded in maintaining gross margins comparable with 2008.
Through the ongoing controlling action, which commenced in 2007, and the introduction of new management, the Company is in a strong position to respond quickly to the challenges as they arise. During Q2 2009 the Board has commenced a programme of cost savings expected to deliver an additional £2.0m annualised savings and we will continue to focus on tight cost controls going forward.
The continuing difficulties facing the sector are providing new opportunities for consolidation of a still very fragmented industry. Following the successful re-structuring of the Group implemented by the new management in 2008, Archial is now well positioned to explore these opportunities.
The Company has a total forward order book of £38m fees and the range of instructions received during Q2 underpins the diversity and ongoing stability of our income stream. Our ongoing fee flow continues to come from both within and outside the UK, where our five overseas offices continue to experience strong enquiries. We are confident that our mixed portfolio in the UK, evenly spread across the public and private sectors, places us in a strong position to respond quickly to the market upturn when it comes. Furthermore, despite the tough economic conditions, we have maintained a healthy flow of new instructions from overseas, as well as from the UK and our focus will continue to be on developing this diverse income stream in the future.
New projects on which we have been instructed during 2009 include:-
Heartlands Academy - part of Birmingham BSF Programme
Further two phases of Lanarkshire Schools
Framework Commission and Initial project with National Systems Manufacturer
Three Manufacturing Facilities in N England
Coalville Shopping Centre - Midlands
50m Swimming Pool Concept - Ilford together with three other UK pool projects
Police Authority buildings in three separate counties
MOD Building Projects in Falkland Islands
Three Science Park Buildings - Cambridgeshire
BAA Projects at various UK Airports
Numerous Retail Projects for National Supermarket
Nursing Home - Cornwall
Karlsbad Masterplan - Czech Republic
Xiangshan, China - Mixed Use Commercial and Retail Concept
Gaoyang Winter Garden Interiors - Shanghai Port Authority
Shenzhen Raffles City, China - Mixed Use Retail Project
Zhoushan Island Regeneration - Mixed Use Masterplan
Kuala Lumpur - Retail Centre
Chris Littlemore, Chief Executive Officer, commented:
"Given the tough economic conditions, we have benefited from our quick and decisive action to manage costs. We will continue to take whatever action is necessary to maintain a respectable level of profitability.
"The Company's diversified and stable revenue stream, achieved through the balance of both private and public sector work in the UK, as well as our UK and international geographic exposure, means we are well placed to take advantage of market opportunities as they arise."
- Ends -
For further information:
| Archial Group Plc Chris Littlemore, Chief Executive Officer John Taylor, Chief Financial Office | Tel: +44 (0)20 7580 0400 |
| Numis Securities Limited Nominated Adviser: Stuart Skinner/ Brent Nabbs Corporate Broking: James Serjeant | Tel: +44 (0)20 7260 1000 |
| Financial Dynamics Billy Clegg / Georgina Bonham / Alex Beagley | Tel: +44 (0)20 7831 3113 |
Notes to editors:
In 2008, the architectural business, The Archial Group, was created from the SMC Group following a process of restructuring and rebranding.
Now one of the UK's largest architectural practices, The Archial Group has established a strong track record of delivering intelligent architectural solutions in public, private and international arenas. It delivers a broad portfolio of sectors across these regions including; commercial, corporate, education, health, leisure, nuclear, residential, retail and transport projects.
The Archial Group prides itself on five key values which form the philosophy of its service to clients and which forms a balanced strategy for every project. These are:- creative integrity, economic performance, environmental responsibility, social contribution and personal experience.
The Archial Group operates from 26 locations in three core businesses forming the key architectural business units; Archial Architects in the UK, Alsop Architects (founded by RIBA Stirling Prize winner Will Alsop) operating globally and Sparch in Asia. The Group is delivering projects throughout the UK, Asia, India, the Middle East, Europe and the North Americas.