Interim Management Statement & Directorate Change

RNS Number : 2099G

Clarke(T.) PLC

19 November 2015

 



TCLARKE PLC

INTERIM MANAGEMENT STATEMENT

AND APPOINTMENT OF NON-EXECUTIVE DIRECTOR

TClarke plc ("TClarke" or the "Group"), the building services group, today issues an Interim Management Statement covering the period from 1 July 2015 to date.

Reflecting the steady improvement in our core markets, the underlying performance of the Group for the year continues to be in line with the Board's expectations.

As expected, net debt has reduced during the second half of the year and as at the end of October stood at £6m (30 June 2015: £8.7m) in line with internal forecasts.

The Group's order book as at 30 September was 15% higher year-on-year and maintained at the level of £320m reported with the interim results. Of the current forward order book, £190m represents work secured for 2016 and £50m for 2017 and beyond. More pleasingly, we can see a significant improvement in the quality of our order book as we work through the majority of contracts awarded during the down-cycle.  We are increasingly confident that this will be reflected in a material increase in our operating margin during 2016 and 2017. The improving quality of our order book is a function of our strategies of focusing on those business units and regions with the greatest potential to impact our future performance, especially London; aligning ourselves with high quality contractors; and bidding only on those contracts that offer appropriate returns.   

Within our 2014 full year results statement in March, we noted our intention to introduce a further series of carefully planned structural changes to our organisation, with the clear purpose of driving improved business performance. More recently, we highlighted the disappointing performance of our Cardiff office due to specific contract challenges. Having reviewed the opportunities for our Bristol and Cardiff offices, we have concluded that they are not capable of delivering the quality of opportunity or level of sustainable margins that we require and therefore both will be closed by the end of 2015. The activity of these offices will be reported as a discontinued operation and is expected to incur a pre-tax loss of £2.6m including cash closure costs of £0.3m. All outstanding contractual obligations will be assumed by an expanded TClarke South West.

The Group has continued to invest in its engineering and skilled resources to ensure the delivery of our target order book and our intention is to maintain a strict focus on projects where we are either in limited competition or there is a single point of negotiation and where we believe we can return margins that align with our strategy. Increasingly, clients are concerned about the limited availability of high quality resource in our sector.  TClarke is regarded as a partner of choice in the sector and this should lead to further opportunities and provides substance to our confidence in future operating margin trends. It remains our strategy not to over-expose the business to any one particular sector and to maintain our project portfolio across our nine target sectors.

Appointment of Non-Executive Director

We are also pleased to announce that Mike Robson, ACA has been appointed as an Independent Non-Executive Director and joined the Group on 18 November 2015.

Mike qualified as a Chartered Accountant with PricewaterhouseCoopers ("PWC") and has wide experience of audit, financial management and reporting gained at PWC and in industry. Mike has 23 years Board level experience in a range of business sectors and is currently a Director and partner of Azure Partners which offers strategic consultancy services to Directors and business owners.

Mike has been appointed as a member of the Audit Committee, Remuneration Committee and Nomination Committee and will serve as Chairman of the Audit Committee.

Mike has a beneficial interest in the Company of 2,000 ordinary shares, representing less than 0.1% of the Company's issued share capital.

There are no matters to be disclosed in respect of Mike's appointment under Listing Rule 9.6.13R.

Ends

For further information contact:

TClarke plc

Mark Lawrence - Group Chief Executive

Martin Walton - Finance Director

Alexandra Dent - Company Secretary

Tel: [phone]

www.tclarke.co.uk

N+1 Singer (Financial Adviser and Broker)

Sandy Fraser

Nick Owen

Tel: [phone]

www.nplus1singer.com

Capital Access Group

Simon Courtenay

Harry Rippon

Tel: [phone]

www.capitalaccessgroup.co.uk

 

END

 

 

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