CIHL.L Regulatory News (CIHL)

13 May 2005 16:39

Carlisle Holdings Ltd18 May 2005 Press Release Carlisle Holdings Limited CARLISLE HOLDINGS LIMITED ANNOUNCES RESULTS FOR THE YEAR ENDED MARCH 31, 2005 AND PROPOSED DIVIDENDS Belize City, Belize, May 13, 2005 -- Carlisle Holdings Limited (NASDAQ: CLHL,London: CLH) ("Carlisle") reported revenue of $345.3m (2004 -- $327.2m) and netincome from continuing operations of $2.6m (2004 -- $9.8m) for the quarter endedMarch 31, 2005, the fourth quarter of fiscal 2005. Diluted earnings per sharefrom continuing operations for the quarter ended March 31, 2005 was $0.04 (2004-- $0.16). For the year ended March 31, 2005, revenue was $1,380.0m (2004 -- $1,225.6m) andincome from continuing operations was $34.0m (2004 -- $34.6m). Diluted earningsper share from continuing operations for the year ended March 31, 2005 was $0.56(2004 -- $0.57). Commenting on corporate performance, Chairman, Lord Ashcroft, KCMG, said: "In the fourth quarter, a number of exceptional items totaling $8.1m wereincurred including higher labor related costs in the Facilities Servicesdivision of approximately $4.4m which arose principally from the obligation tostrengthen long-term insurance reserves. The Staffing Services division incurred$2.3m of one-time redundancy and reorganization costs on completion of theintegration of Professional Staff and at the corporate level there was aone-time legal and professional charge of $1.4m. These factors have adverselyimpacted operating results in the fourth quarter and are not expected to recur. "OneSource continues its good track record on customer retention and newbusiness development is bringing in new opportunities. Management remains firmlyfocused on providing high-quality and cost-effective solutions to clients. 'UK Facilities Services performed well on both new business wins and customerretention. "The Staffing Services division continues to build its business base and organicyear-on-year revenue growth was robust. With the costs and distraction of theintegration now behind it, the division anticipates seeing benefitsmaterializing in the coming year. "Our markets are competitive and management is committed to providing thehighest levels of service to retain customers and maintain the integrity of ourbrands. While efficiency has improved in all divisions, controlling costsremains a priority in softening macro economic conditions." Fourth Quarter Operational Review Facilities Services The Facilities Services division reported an operating loss, after the laborrelated costs of $4.4m, for the quarter ended March 31, 2005 of $2.0m (2004 --operating income $1.8m) on revenues of $232.0m (2004 -- $229.2m). Operatingincome for the year ended March 31, 2005 amounted to $6.7m (2004 -- $7.0m) onrevenues of $943.5m (2004 -- $904.4m). OneSource met revenue expectations and key operational measurements for thefourth quarter and full fiscal year 2005. Continued success in competitive rebidsituations, business development efforts and focused client services programshave resulted in a strong revenue run rate. During the fourth quarter however, OneSource was obligated to strengthen certaininsurance related reserves, and resolved certain specific historic liabilities,including and mainly related to the actuarial calculation of workers'compensation and other liabilities. Management maintains a strong focus in the key areas of customer retention,operating efficiencies and overall cost control. OneSource continues todistinguish its service offering through total cost management solutions foroutsourced services and continued improvements through strategic efficiencyinitiatives which drive more value into our client relationships. UK Facilities Services achieved solid year-on-year revenue growth, driven bygood performance in all operations. Customer retention has continued to improvein the markets for both Cleaning Services and Security Services. Additionalbusiness has been added with London Underground and contract gains in theTransport sector cleaning business have progressed smoothly. The securitybusiness continues to face increased costs from more onerous licensingregulations. A recent joint venture arrangement entered into by the Irelandsecurity operation will add revenues to a fixed cost base and this is expectedto improve performance there in the year ahead. Management's priorities for thecoming year remain fixed on efficiency improvement, customer retention andprofitable growth. Staffing Services Carlisle Staffing Services reported revenue of $113.3m for the quarter endedMarch 31, 2005 (2004 -- $98.0m). Operating loss for the quarter ended March 31,2005 amounted to $1.6m (2004 -- operating income $0.9m) after one-time chargesin the quarter of $2.3m (2004 -- $ nil). Operating income for the year endedMarch 31, 2005 amounted to $2.0m (2004 -- $2.9m) on revenues of $436.5m (2004 --$321.2m). Revenue in the year ended March 31, 2005 benefited from a full twelve monthcontribution from Professional Staff compared with only a nine monthcontribution in the period ended March 31, 2004 (see notes to consolidatedfinancial information). The improving market for Technology and Telecomsstaffing has also driven recent growth. During the fourth quarter the Division incurred $2.3m in one-time charges,principally severance payments, resulting from the completion of the integrationof Professional Staff into the Staffing Services division. Further improvementsto the business are anticipated as greater efficiencies are progressivelyachieved within the enlarged operation. Enhancing productivity and costeffective support for the combined operation is a high priority. The platform for continued growth in the coming year is taking shape and theDivision remains well positioned across a broad range of markets. The keymarkets for Office, Technology/Telecoms and Pharmaceutical/Scientific staffinghave been clearly targeted and it is expected to further develop the brands inthese sectors while providing cost effective support to the combined operation. Financial Services Financial Services reported another solid performance for the quarter endedMarch 31, 2005. Operating income increased by 1.2% to $8.5m (2004 -- $8.4m). For the year ended March 31, 2005, operating income increased by 3.3% to $30.9m(2004 -- $29.9). The results for the year reflect a 2.7% increase in netinterest income. Proposed Dividend Following the successful completion of the investment by Seashell Group Limitedin Wraith plc, the directors of Carlisle announce a dividend which, subject tofulfilment of the condition described below, it intends will be payable to allholders of those Carlisle shares which are entitled to receive dividends at 4:30pm New York Time on May 27, 2005, the record date for the dividend. Thisdividend will be satisfied by the transfer to qualifying holders of Carlisleshares of Carlisle's entire shareholding in: (i) its wholly-owned subsidiary Seashell II Limited ("Seashell II"); and(ii) its wholly-owned subsidiary Bombshell Limited ("Bombshell"). It is intended that Seashell II and Bombshell will broadly seek to replicate thestrategy followed by Seashell Group Limited and seek investment opportunities,as described further below. Seashell II and Bombshell are companies incorporated in Belize under theInternational Business Companies Act each with an issued share capital of £3.2m(being the sterling equivalent at close of business UK time as quoted byBloomberg on May 12, 2005 of US$6.0m), divided in each case into 6,433,454shares of fifty pence each. Accordingly and except as provided below, a holder of Carlisle shares on therecord date will receive approximately 1.0704 shares in each of Seashell II andBombshell for each 10 shares in Carlisle held by him. Exact entitlements will becalculated by reference to the number of Carlisle shares entitled to receivedividends at 4:30pm New York Time on May 27, 2005. Carlisle shareholders who are citizens, residents or nationals of the UnitedStates (including US based custodians, nominees or trustees for persons who arenot, or who are, citizens, residents or nationals of the United States), shallnot receive shares in either Seashell II or Bombshell and shall receive cash inUS$ for each Carlisle share registered in his name. The shares in each ofSeashell II and Bombshell which such Carlisle shareholders would otherwise havereceived shall be sold to placees procured by Carlisle and each such shareholdershall receive cash in US$ of approximately $0.09983 for every Carlisle shareregistered in his name. In addition, Carlisle shareholders who, if Seashell II shares and Bombshellshares were to be transferred to such shareholders, would receive fewer than 10Seashell II shares and 10 Bombshell shares, shall not receive shares in eitherSeashell II or Bombshell and shall receive cash in US$ of approximately$0.09983, with the exception of UK shareholders who will receive cash in UK£ ofapproximately £0.0535 for each Carlisle share registered in his name for each ofSeashell II and Bombshell. The shares in each of Seashell II and Bombshell whichsuch Carlisle shareholders would otherwise have received shall be sold toplacees procured by Carlisle. Application will be made for the admission of the shares in each of Seashell IIand Bombshell to trading on the Alternative Investment Market of the LondonStock Exchange ("AIM") and the payment of the dividend is conditional onadmission of the shares in each of Seashell II and Bombshell to AIM. Thedirectors of each of Seashell II and Bombshell include Lord Ashcroft, KCMG, MrDavid Hammond and Mr Philip Osborne, all officers of Carlisle. Following itsadmission to AIM, each of Seashell II and Bombshell will seek to invest ineither a publicly traded or private company, including businesses with goodstrategic plans founded by entrepreneurs who are looking for financial backing.By influencing the management and direction of the entity in which theinvestments are made, it is intended to create value for the shareholders ofeach of Seashell II and Bombshell. No such investments have yet been identified. Carlisle shareholders will shortly be sent a letter explaining the proposeddividends including details of their entitlements, and Carlisle shareholders whowill receive shares in each of Seashell II and Bombshell will also be sent theSeashell II admission document and the Bombshell admission document produced inconnection with their respective proposed application for admission to AIM.These documents will be despatched to shareholders on the register on the recorddate. The shares in each of Seashell II and Bombshell are expected to beadmitted to trading on or around June 22, 2005 and shareholders will receivetheir shares in each of Seashell II and Bombshell or their cash entitlementshortly thereafter. Background Information Through its OneSource brand, Carlisle Group is a leader in the outsourcedfacilities services sector in the US and provides janitorial, landscaping,general repair and maintenance and other specialized services for more than10,000 commercial, institutional and industrial accounts. In the UK and Ireland,Carlisle Group is also a leading provider of business services. CarlisleFacilities Services is a national provider for a broad range of people-dominatedfacilities services (specializing in the industry sectors of Retail, Transportand Public Sector). Carlisle Staffing Services continues to develop asignificant position in the staffing services sector with a presence in themarkets for Professional Services, Office and Industrial, Public Services,Scientific and Telecoms/Technology and the developing Human Resources Servicesmarket. This business has over 80 locations with a weekly temporary/contractorbase of over 9,000 workers employed across more than 5,000 clients. The Companyalso has interests in Financial Services. Forward Looking Statements Certain statements in this press release constitute "forward looking statements"within the meaning of the Private Securities Litigation Reform Act of 1995. Inparticular, statements contained herein regarding the consummation and benefitsof future acquisitions, as well as expectations with respect to future revenues,operating efficiencies, net income and business expansion, are subject to knownand unknown risks, uncertainties and contingencies, many of which are beyond thecontrol of Carlisle, which may cause actual results, performance or achievementsto differ materially from anticipated results, performance or achievements.Factors that might affect such forward looking statements include among others,overall economic and business conditions, the demand for Carlisle's services,competitive factors, regulatory approvals and the uncertainty of consummation offuture acquisitions. Additional factors which may affect Carlisle's businessesand performance are set forth in submissions by Carlisle Holdings Limited withthe United States Securities and Exchange Commission, (the SEC), which areavailable without charge from the SEC at www.sec.gov. For further information contact: Makinson Cowell Carlisle Group+1 (212) 994 9044 UK +44 (0)20 7248 6700 Belize +501 227 7178 Note: This and other press releases are available at the Company's web site:http://www.carlisleholdings.com. Carlisle Holdings LimitedFinancial InformationSummarized Consolidated Statements of Income (unaudited)US dollars in millions except per share data 3 months ended 3 months ended 12 months ended 12 months ended March 31, March 31, March 31, March 31, 2005 2004 2005 2004---------------------------------------------------------------------------------------------------Net salesFacilities Services 232.0 229.2 943.5 904.4Staffing Services 113.3 98.0 436.5 321.2---------------------------------------------------------------------------------------------------Total net sales 345.3 327.2 1,380.0 1,225.6---------------------------------------------------------------------------------------------------Operating income (loss)Facilities Services (2.0) 1.8 6.7 7.0Staffing Services (1.6) 0.9 2.0 2.9Financial Services 8.5 8.4 30.9 29.9Corporate expense (2.5) (1.4) (6.0) (4.7)---------------------------------------------------------------------------------------------------Total operating income 2.4 9.7 33.6 35.1---------------------------------------------------------------------------------------------------Associates 1.7 1.1 5.3 4.2Net interest expense (0.6) (0.1) (1.9) (3.0)---------------------------------------------------------------------------------------------------Income before income taxes 3.5 10.7 37.0 36.3Income taxes (0.3) (0.4) (1.0) (0.9)---------------------------------------------------------------------------------------------------Income after income taxes 3.2 10.3 36.0 35.4Minority interests (0.6) (0.5) (2.0) (0.8)---------------------------------------------------------------------------------------------------Income from continuing operations 2.6 9.8 34.0 34.6Income from discontinued operations - 5.3 - 9.7---------------------------------------------------------------------------------------------------Net income 2.6 15.1 34.0 44.3---------------------------------------------------------------------------------------------------Earnings per ordinary share: Basic:Continuing operations $0.04 $0.16 $0.56 $0.58Discontinued operations - $0.09 - $0.16Net Income $0.04 $0.25 $0.56 $0.74 Diluted:Continuing operations $0.04 $0.16 $0.56 $0.57Discontinued operations - $0.09 - $0.16Net Income $0.04 $0.25 $0.56 $0.73 Number of shares - basic 60.2m 60.1m 60.3m 59.9mNumber of shares - diluted 60.7m 60.6m 60.8m 60.3m--------------------------------------------------------------------------------------------------- Carlisle Holdings LimitedFinancial InformationSummarized Consolidated Balance Sheet (unaudited) At March 31 2005 2004 $m $m AssetsService Businesses current assets:Cash and cash equivalents 19.9 31.3Trade accounts receivable - net 170.8 167.6Other current assets 28.8 29.9------------------------------------------------------------------------------Total Service Businesses current assets 219.5 228.8Goodwill - net 400.4 397.7Other long-term assets 118.1 111.6------------------------------------------------------------------------------Total Service Businesses assets 738.0 738.1Total Financial Services assets 461.3 397.0------------------------------------------------------------------------------Total assets 1,199.3 1,135.1------------------------------------------------------------------------------Liabilities and shareholders' equityService Businesses current liabilities:Short-term debt 46.2 49.6Other current liabilities 147.1 141.3------------------------------------------------------------------------------Total Service Businesses current liabilities 193.3 190.9Total Service Businesses long-term liabilities 65.9 69.2------------------------------------------------------------------------------Total Service Businesses liabilities 259.2 260.1Total Financial Services liabilities 364.7 329.8------------------------------------------------------------------------------Total liabilities 623.9 589.9Total shareholders' equity: 575.4 545.2------------------------------------------------------------------------------Total liabilities and shareholders' equity 1,199.3 1,135.1------------------------------------------------------------------------------ Carlisle Holdings LimitedFinancial InformationSummarized Consolidated Statements of Cash Flows (unaudited)Year ended March 31 2005 2004 $m $mCash flows from operating activities Net income 34.0 44.3Adjustment to reconcile net income to net cashprovided by operating activitiesDepreciation 12.0 23.6Gain on disposal of discontinued operations - (4.7)Other (1.2) 11.2Changes in assets and liabilities (9.4) (12.8)---------------------------------------------------------------------------------Net cash provided by operating activities 35.4 61.6---------------------------------------------------------------------------------Cash flows from investing activitiesPurchase of property plant and equipment (net of disposals) (11.8) (17.7)Disposal of discontinued operations - 48.1(Increase) decrease in interest-bearing deposits (25.7) 12.3Increase in loans to customers (33.5) (39.3)Acquisition of businesses - (9.3)---------------------------------------------------------------------------------Net cash utilized by investing activities (71.0) (5.9)---------------------------------------------------------------------------------Cash flows from financing activitiesNet proceeds (repayment) of short-term and long-term debt 2.3 (9.6)Increase in deposits 35.1 15.0Increase in restricted cash deposits (0.8) (46.6)Dividends (9.3) -Other 0.8 0.4---------------------------------------------------------------------------------Net cash provided (utilized) by financing activities 28.1 (40.8)---------------------------------------------------------------------------------Currency translation adjustments 0.1 (0.1)Net change in cash, cash equivalents and due from banks (7.5) 14.8Cash, cash equivalent and due from banks at beginning of year 54.2 39.4---------------------------------------------------------------------------------Cash, cash equivalent and due from banks at end of year 46.8 54.2--------------------------------------------------------------------------------- Notes: In April 2004, the Company acquired the entire issued share capital of OhseaHoldings Limited ("Ohsea"). Ohsea is a holding company, incorporated in theUnited Kingdom, whose principle asset is its wholly owned investment inProfessional Staff Limited ("Professional Staff"), a company incorporated in theUnited Kingdom, which was acquired by Ohsea in July 2003. Professional Staff andits subsidiaries are a staffing services group based mainly in the UnitedKingdom and the United States, providing temporary and permanent staffrecruitment services principally to the Scientific and Telecoms/Technologymarkets. The acquisition of Ohsea has been accounted for using the "as-if" pooling ofinterests method of accounting due to the existence of a common controllingshareholder in both Carlisle and Ohsea. This method of pooling of interestsrequires that the consolidated financial statements of Ohsea are pooled withthose of the Company for all accounting periods reported, with a minorityinterest elimination for all periods where a non-controlling minority interestexisted in the share capital of Ohsea. Ohsea acquired Professional Staffeffective July 1, 2003 and consequently the consolidated statements of income ofthe Company include 100 percent of the results of Ohsea (together with anelimination of the appropriate minority interest) for the year ended March 31,2005 and for the nine month period ended March 31, 2004. The summarizedfinancial information as at March 31, 2004 and for the year then ended has,accordingly, been restated. - Ends - This information is provided by RNS The company news service from the London Stock Exchange