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5 Nov 2008 07:00
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5 November 2008
WILMINGTON GROUP PLC
INTERIM MANAGEMENT STATEMENT
At today's Annual General Meeting of Wilmington Group plc, David Summers, Chairman, will makeΒ reference toΒ the following statement regarding the financial position and current trading performance:
Trading performance in the three months to 30 September 2008, the first quarter of our financial year, was broadly in line with the board's expectationsΒ despite a deteriorating economic backdrop. Underlying revenue from continuing operations*Β was 4% ahead of the same period in the prior year.
Adjusted profitsΒ from continuing operations**Β were ahead of the prior year.
Since we announced our results for the year ended 30 June 2008,Β the economic outlook has deteriorated. ConsequentlyΒ we felt it was appropriate to initiateΒ aΒ thoroughΒ reviewΒ across the Wilmington GroupΒ to examine how we canΒ proactively maximise productivity and marginsΒ and, where appropriate, reduce our cost base.
In addition,Β the boardΒ hadΒ decidedΒ to sellΒ the music information business Muze and our HPCi business, which published the magazines "Soap, Perfumery and Cosmetics", "Manufacturing Chemist" and "CleanroomΒ Technology"Β whichΒ were not core to our strategy of serving the information and training requirements of professional markets.
Following these disposals we haveΒ reorganisedΒ the Wilmington Business Information division and consolidated the management ofΒ its assetsΒ with the Waterlow Legal and Regulatory division. This creates a professionalΒ informationΒ businessΒ thatΒ accounts for approximately 47% of Wilmington Group turnover and contributes nearly 60% of Group operating profits before central overheads.
A number ofΒ specificΒ cost and staff savings have been identified across the Group. As a result of this action we have created a more effective operational structure. However,Β non-recurring costs of approximately Β£700kΒ will beΒ incurred as a result of the proposed changes.
We announced on 28 July 2008 that the company had received an approach which subsequently did not result in an offer being made for the company. DuringΒ theΒ first quarter the company incurred approximately Β£600kΒ of abortive transaction costs.
Outlook:
We expect trading conditions toΒ remainΒ challenging.
Nevertheless, weΒ are confident that our publishingΒ and informationΒ businesses are robust andΒ should performΒ in line with the prior year.
Whilst many of our training businesses are underpinned by professional regulations, discretionary expenditureΒ by our clientsΒ is under pressure. Towards the end of our first quarter we have seenΒ aΒ reduction inΒ someΒ course bookings on a like for like basis;Β asΒ indicatedΒ the company isΒ implementing a cost reduction programme to align its cost base with current market conditions and our outlook for 2009. The reduction in course bookings is partiallyΒ mitigated by the Matchett Group, which has delivered its anticipated contribution in our first quarter when the bulk of its profits for the financial year are made. We also expect that our investment inΒ SingaporeΒ will reduce this financial year and anticipate a modest net profit fromΒ Singapore.Β
It is always difficult toΒ predictΒ the outcome so early in the year and in these very uncertain times it is clearly even more problematic. However, given the cost savings being implemented and the momentum from recent acquisitions the Board currently expects the Group overall to report underlying performance from continuing operations marginally ahead of last year.
We remain a cash generative business with a modest level of gearing and haveΒ committed bank facilities until 2012 that will enable us to continue to underpin the development of our business with further bolt on acquisitions. Our business is resilient with strong management teams which will enable the company to continue to grow and to grasp opportunities as they arise.
David Summers
Chairman
5 November 2008
* ExcludesΒ revenue contribution from acquisitions (Matchett and APIS) and revenue contribution from disposals (Muze andΒ HPCi ).
** Pre-exceptional items and excluding any earnings contribution from disposals (Muze andΒ HPCi ).
Β - Ends -Β
Enquiries:
Wilmington Group PLC
Charles Brady, Chief Executive 0207 422 6800
Weber Shandwick Financial
Nick Oborne /Β Louise Robson / Clare Perks 0207 067 0700
Numis Securities
James Serjeant 0207 260 1309
RBSΒ Hoare GovettΒ
Sara Hale 0207 678 8000
Notes to Editors
Wilmington Group plc is one of the UK's leading providers of information and training for professional business markets. The Group provides training, arranges industry events and publishes magazines, directories, databases and special reports focused primarily on professional markets. Capitalised at approximately Β£120 million, Wilmington floated on the London Stock Exchange in 1995.
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