Last checked at 15 Jan 2019 07:00
15 January 2019
Mears Group PLC
("Mears" or "the Company" or "the Group")
Trading Update and Notice of Results
Trading in FY2018 meets expectations
Mears, the provider of support services to the Social Housing and Care sectors in the UK, announces the following update for the year ended 31 December 2018 ('FY2018').
Trading in FY2018 was in line with the Board's expectations. The performance was achieved in competitive trading environments in both Housing and Care and includes the bid costs on several large opportunities which are expensed as incurred. Spending by customers in Housing and Care is broadly stable and, though budgets are always under pressure, most of the Group's activities are essential. The Company has continued to evolve its activities in response to customer requirements.
Following the acquisition of selected assets and contracts from Mitie Property Services ('MPS') in November, the integration of these into the Group is on track and progress to date with staff, customers and suppliers has been positive.
On 8 January 2019, the Group announced the award of three new contracts worth in excess of £1bn under the Asylum Accommodation and Support Services Contract ('AASC'), delivering estimated revenues of around £100m a year for the next 10 years. The preliminary mobilisation of AASC has started and the contracts will be fully operational in Q4 2019.
The Group order book stands at £3.2bn and revenues for 2019 flowing from firm and probable orders are estimated at £1.03bn.
Average daily net debt during 2018 was £115m, fractionally higher than the target of £110m set at the start of the year, primarily due to the timing of certain development activities which will now mature in Q1 2019.
Capital Markets Event and Notice of Results
The Group will be hosting a Capital Markets Event in February 2019. This will cover Group strategy and provide further background on the new AASC contract award. No new trading information will be disclosed at the event.
Mears will issue its full year results for FY2018 on Tuesday 19 March 2019.
David Miles, Chief Executive of the Group, commented:
"2018 was a year of very good progress for Mears. We ended the year with an acquisition and, more recently, were awarded three large contract wins which, together, add over 20% to our revenue on an annualised basis. I am grateful for the support shown in our recent equity fund raising in connection with the MPS acquisition.
"We expect to make further progress in 2019, helped by our continuing cost reduction programme and the long term relationships with our customers. The positive impact of the new work announced recently will come through fully in 2020 and beyond."
For further information, contact:
Mears Group PLC
David Miles, Chief Executive Officer | Tel: +44(0)7778 220 185 | |
Andrew Smith, Finance Director | Tel: +44(0)7712 866 461 | |
Alan Long, Executive Director | Tel: +44(0)7979 966 453 | |
www.mearsgroup.co.uk | ||
Buchanan
Mark Court/Sophie Wills/Catriona Flint Tel: +44(0)20 7466 5000
mears@buchanan.uk.com
About Mears
Mears employs over 10,000 people and provides services in every region of the UK. In partnership with our Housing clients, we maintain, repair and upgrade the homes of hundreds of thousands of people in communities from remote rural villages to large inner city estates. Mears has extended its activities to provide broader housing solutions to solve the challenge posed by the lack of affordable housing. Our Care teams provide support to over 15,000 people a year, enabling the elderly and those living with disabilities to continue living in their own homes.
We focus on long-term outcomes for people rather than short-term solutions, and invest in innovations that make a positive impact on people's quality of life and on their communities' social, economic and environmental wellbeing.