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6 May 2016 07:00
News Release
6th May 2016
Trading Update
Interserve, the international support services and construction group, today provides an update on current trading for the first four months of the year and revised guidance for full year 2016 performance.
Trading in our Support Services division remains robust and in-line with our expectations. Notable in a strong period of work winning was the £230 million contract award to provide facilities services to the United States Air Force's UK estate.
Equipment services continues to have good momentum across its international markets, particularly the UK and Far East. Performance in the Middle East has been in line with our expectations although as noted at the time of our preliminary results, some uncertainty remains. The strategic review of our Equipment Services division announced with our preliminary results is proceeding to plan.
Our International Construction business is also performing as expected, maintaining good visibility of future workload.
Trading in the building and fit-out segments of our UK construction business remains healthy.
However, our expectations for the UK construction division as a whole have been significantly adversely impacted by a further deterioration in our Glasgow energy from waste contract. The issues relate to the design, procurement and installation of the gasification plant, together with continuing challenges with the supply chain that will result in further cost overruns and delays. As a result the Board anticipates a £70m exceptional contract provision to be taken in the first half of 2016, resulting in a similar level of cash outflow spread across 2016 and 2017. We will be pursuing every opportunity to mitigate this situation.
Our balance sheet remains robust. However, taking full account of the cash impact of the contract provision noted above, net debt is expected to be around £35m higher than previously guided at both the half year and the year end.
Adrian Ringrose and Tim Haywood will be hosting a call for investors at 8.30am. If you would like to register please contact Michael Kinirons at:
interserve@cnc-communications.com
For further information please contact:
Robin O'Kelly, Group Director of Communications +44 (0) 7786 702526
Richard Campbell/Michael Kinirons +44 (0) 203 219 8816
About Interserve
Interserve is one of the world's foremost support services and construction companies. Our vision is to redefine the future for people and places. Everything we do is shaped by our core values. We are a successful, growing, international business: a leader in innovative and sustainable outcomes for our clients and a great place to work for our people. We offer advice, design, construction, equipment, facilities management and frontline public services. We are headquartered in the UK and listed in the FTSE 250 index. We have gross revenues of £3.6 billion and a workforce of circa 80,000 people worldwide.
www.interserve.com
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