JNY.L Regulatory News (JNY)

19 May 2008 07:00



Watermark Group plc

("Watermark" or the "Company")

Interim Management Statement

19 May 2008

Watermark, a leading provider of in-flight products, catering and cabin management services to the airline and travel industries, today announces its interim management statement for the period from 1 January 2008 to the date of this announcement.

Trading in the Services Division is showing a significant improvement over the same period last year with the Products Division also trading ahead of last year. 

The year has begun well with the new divisional structure beginning to settle and the benefits of the restructuring carried out last year beginning to feed through. The Directors continue to drive operational efficiency. New projects have been identified for implementation in the second half of the year, with the expected benefits due to fall into 2009.

During the quarter both businesses have seen a further strengthening of their senior management teams, setting the base for planned growth.

As announced on 31 March 2008, the Company's wholly owned subsidiary, Air Fayre Limited, signed a partnership agreement with United Airlines ("United") to provide logistics to manage all of United's on-board catering requirements at Los Angeles International Airport. The Directors estimate that the contract will generate revenues of approximately $24 million per annum. Work has begun on the Los Angeles hub, which is expected to begin servicing United from late in 2008. 

Qantas has informed the Company that it has agreed to renew its catering contract for a further three years from December 2008 amounting to revenues of approximately £7million per annum, this being the most significant catering renewal in the current financial year.

Work continues on the capital reorganisation and fund raising announced on 31 March 2008. A circular setting out details of certain resolutions and requisitioning a general meeting of Watermark shareholders will be sent to Watermark shareholders in due course.

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