MPAY.L Regulatory News (MPAY)

14 Dec 2007 11:49

Autoclenz Holdings PLC14 December 2007 Issued by Citigate Dewe Rogerson Ltd, BirminghamDate: Friday, 14 December 2007 IMMEDIATE RELEASE Autoclenz Holdings plc ("Group" or "the Company") New Service Offering and Trading Update The Company expects to announce its financial results for the year ending 31December 2007 during the week commencing 17 March 2008. Prior to this, the Groupprovides the following update to shareholders on trading. Despite tough trading conditions the Group's performance has proved resilient.Whilst the core valeting business is performing below expectations it ispleasing to report that growth has been achieved in Pinnacle's revenues, andthat the Daily Rental business has performed strongly achieving 20 per centgrowth against the same period in 2006. Within the SMART Repair sector we have continued to invest in operators,operator training and infrastructure which, when linked to sales decline in theautomotive sector overall, has produced a slower growth rate than originallypredicted, though we have still managed to achieve double-digit sales growth. Our specialist operation REACT is rebuilding its market position and theDirectors believe that the new contracts secured during the second half of thisfinancial year will provide a solid base from which to grow profits and revenuesduring 2008. The cumulative impact of the above on the Directors' expectations for thecurrent financial year amounts to a marginal shortfall of approximately £200,000in pre-tax profits. To build on the Group's strong presence and existing partnerships within the UKCar Rental market, Autoclenz is developing its 'Collection & Delivery' service.To this end, the Company has just committed to invest approximately £300,000 oninfrastructure, personnel and specialist IT software. The impact of this investment, all of which will be written off in the currentfinancial year, is that profits will be £300,000 lower than the level indicatedin the prior paragraph giving an overall reduction of approximately £500,000 tothe Directors' expectations for the current financial year. The Board has been keen to develop its presence within the 'Collection &Delivery' service arena and remains optimistic that the Company can utilise itsexisting skills and experience to expand into this market. Key customers withinthis growing sector are Premier First (an amalgamation of National Car Rental &Europcar), Avis and Helphire. The Directors believe that this investment willyield significant benefits next year. Estimated annualised sales for this newsector of work could be in the region of £4.5 million, achieving breakeven bythe end of the first half of 2008, with profits feeding through thereafter. Thisbusiness stream adds to the Group's existing Ready to Rent business which hasannualised revenues of in the region of £4 million. SummaryNotwithstanding disappointment in relation to the current year's results theDirectors remain confident that the Company will continue to build itsmarket-leading position for the benefit of future revenues and earnings. Despiteoperating in a very challenging environment the Board continues to focus on arange of operational efficiencies, tight cost controls and new businessdevelopments and opportunities. The Directors exit 2007 with optimism,especially in light of the reduced dependence on the automotive sector which theGroup's expanding presence within the car rental market provides. DividendThe Group continues to generate cash and the Directors continue to support thestated dividend policy and accordingly confirm that, barring any unforeseencircumstances or further deterioration in the markets, they expect to be in aposition to recommend the payment of a maintained final dividend for the yearending 31 December 2007. Enquiries:Grahame Rummery, Chief ExecutiveTrevor Clingo, Group Finance Director Fiona Tooley or Keith GabrielAutoclenz Holdings Plc Citigate Dewe RogersonTel: 08707 510 410 Tel: 0121 455 8370www.autoclenz.co.uk Julian BluntKBC Peel HuntTel: 020 7418 8900 Notes to Editors:Founded in the 1960s, Autoclenz is widely recognised as the leading name in carvaleting and vehicle preparation in the UK. The Company provides the completepackage for the total valeting operation that includes labour, chemicals,equipment, materials, management and quality control systems that are requiredto achieve quality vehicle preparation. A commitment to a high quality, costeffective service has made Autoclenz a key partner to many of the best knownnames in the fleet, daily rental, auction and dealer network across the country.Key customers to Autoclenz include Helphire, Premier First, AVIS, BCA and majorautomotive groups. This information is provided by RNS The company news service from the London Stock Exchange