15 May 2013 07:00
Embargoed: 0700hrs, 15 May 2013
Cape plc
("Cape" or the "Group")
Interim Management Statement
Cape plc, the international provider of essential support services to the energy and mineral resources sectors, today issues the following Interim Management Statement for the year to date, in advance of its Annual General Meeting which will be held at 11.00am today.
Trading
Cape is pleased to confirm that the Group's overall trading for the first quarter has been in line with the Board's expectations.
The UK, Europe & CIS region has performed in line with expectations, with volumes slightly higher and operating margins slightly lower than expectation due to the mix of work across the region. As announced on 26 April, the Group has secured an important maintenance contract in Azerbaijan through its SOCAR CAPE joint venture. The joint venture is currently mobilising to ensure a smooth transition from the previous contractor.
The MENA region has performed ahead of expectations driven by higher activity levels and slightly higher operating margins than expected. The Arzew Project in Algeria remains on track with the revised plan and the cost to complete is expected to be in line with the previously disclosed provision.
Activity levels in the Asia Pacific region remain in line with expectations reflecting higher volumes in Singapore as the large construction project comes to completion offsetting lower volume in the Onshore Australia business that reflects weakening market conditions. Operating profit margins for the region were depressed partly due to this mix of volume and partly due to lower than expected margins in the Onshore Australia business.
In light of the market conditions in Australia and resultant deterioration in business performance, management has instigated further action to reduce costs in order to deliver a strong, cost effective platform for future growth, particularly in the petroleum and LNG markets. The business expects to complete further organisational changes during 2013 including the consolidation of certain branches and the closure of some smaller branches. This will enable the business to maintain its focus on winning and executing major capital work packages whilst building a sustainable maintenance business in the long-term.
Outlook
Cape has made a solid start to 2013. The focus for the year ahead remains driving operational excellence throughout the Group to optimise the performance of its existing business whilst providing the platform for future growth.
In light of current market conditions, the regional outlook for the full year performance for 2013 is anticipated to follow a similar trend to the first quarter, with the Asia Pacific region, and Australia in particular, expected to be challenging. At this stage in the financial year the Board remains confident that the business overall is on track to deliver in line with expectations for the year ending 31 December 2013.
Financial calendar
Cape expects to announce its results for the half year ending 30 June 2013 on 29 August 2013.
- End -
Enquiries:
Cape plc | |
Karen Menzel, Director of Investor Relations | +44 (0)1895 459965 / +44 (0) 7720 971638 |
Forward looking statements
Any forward looking statements made in this document represent the Board's best judgment as to what may occur in the future. However, the Group's actual results for the current and future fiscal periods and corporate developments will depend on a number of economic, competitive and other factors, some of which will be outside the control of the Group. Such factors could cause the Group's actual results for future periods to differ materially from those expressed in any forward looking statements included in this announcement.
About Cape:
Cape plc (www.capeplc.com), which is listed on the main market of the London Stock Exchange, provides a range of essential industrial services including access systems, insulation, painting, coating, blasting, refractory linings, industrial cleaning, training and assessment to industrial plant operators and major international engineering and construction companies.
As a single source provider, Cape is able to provide a range of specialist multi-disciplinary services specifically tailored to meet the needs of the client providing the most intelligent and cost efficient solutions for our clients' in-plant maintenance and capital needs.
In the year ended 31 December 2012, Cape reported adjusted revenues of £749.4 million. With scale and leading market positions across its international footprint, Cape employs over 21,000 people around the world.