TIDMBMS
RNS Number : 5334A
Braemar Shipping Services PLC
03 February 2022
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED TO
CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE
REGULATION (EU NO. 596/2014) WHICH IS PART OF UK LAW BY VIRTUE OF
THE EUROPEAN UNION (WITHDRAWAL) ACT 2018. UPON THE PUBLICATION OF
THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE
IN THE PUBLIC DOMAIN
BRAEMAR SHIPPING SERVICES PLC
("Braemar", the "Company" or the "Group")
3 February 2022
Trading update, proposed board changes, change in employee
reward structure and update with respect to Cory disposal
Braemar Shipping Services Plc (LSE: BMS), a leading
international Shipbroker and provider of expert advice in shipping
investment, chartering, risk management and logistics services, is
pleased to give the following update to the market on trading and
other matters.
Trading update
The strong trading seen in the first half of the financial year
has continued throughout the second half to date. Revenues* for the
year ended 28 February 2022 are now expected to be not less than
GBP101m (2021: GBP84m).
This strong performance reflects favourable market conditions
and, more importantly, the investments we have made in increasing
the breadth, focus and depth of the Group's shipbroking activities.
Of note, a volatile Dry Cargo market has helped us increase both
revenue and market share on the physical and securities desks. The
Sale and Purchase desk has concluded a significantly higher number
of transactions, largely due to the strong Dry Cargo market, but
also due to the synergies gained from closer collaboration with the
Financial Division on containers. Tanker market rates have remained
low, impacted by pandemic related weakness in oil demand. However,
Tanker transaction volumes have increased by more than 25% compared
to the previous year, aided by strategic hires, including the
previously announced Clean Products hires in Geneva.
The Group's employee reward arrangements are also being changed
in respect of the current and future years, as described below,
with the consequence that an additional cash bonus of GBP2.8m will
be charged to profits in the current year. The proposed changes
should however positively impact reported profitability in future
years as the charge to profitability of the deferred equity is
similarly reduced. The Group expects underlying operating profit*
for the year to 28 February 2022 to be circa GBP9.8m (28 February
2021: GBP7.7m).
Proposed changes to employee reward arrangements
In order to better align shareholder and employee interests and
support the Group's successful growth agenda, the Board has
concluded that it should reduce the overall amount of deferred
equity issued annually as part of employee remuneration
arrangements.
Under the current scheme, deferred shares have been awarded and
issued to employed recipients over a three-year vesting period and
generally settled by shares purchased in the market. Whilst this
scheme will remain unchanged, the amount paid in such deferred
shares will be halved with an increase in cash bonuses paid of the
same amount. This will also apply in future years and will involve
claw back arrangements on the additional cash payments in order to
encourage employees to remain in Braemar's employment.
Disposal of Cory Brothers
Good progress is being made on the disposal of Cory Brothers,
the Group's non-core Logistics Division, which is expected to be
concluded over the next few weeks. The disposal, however, is no
longer expected to be by way of a joint venture but rather an
outright disposal for a combination of upfront cash and deferred
payments based on a three year earn out.
The financial performance of Cory Brothers remains in line with
previous guidance but is not included in the above numbers.
Moreover, Cory Brothers' trading for the year will be included in
the Company's full year results as 'discontinued operations' due to
the planned disposal of the business.
Proposed Board change
Braemar announces that Lesley Watkins, Audit Committee Chair,
will resign from the board with effect from 31 March 2022 in order
to be able to take on another non-executive role.
Braemar is pleased to announce that Joanne Lake will succeed
Lesley. Joanne will be appointed to the board as a non-executive
director with effect from 1 March 2022 and will become Audit
Committee Chair with effect from 1 April 2022. Joanne will also
join the Remuneration and Nomination Committees from 1 March 2022.
Elizabeth Gooch will succeed Lesley in the role of senior
independent director from 1 April 2022.
Nigel Payne, Braemar's Chairman commented: "Lesley was appointed
a non-executive director in June 2017 and became Audit Committee
Chair later that year. We are very grateful for Lesley's
significant contribution to the group. We have particularly valued
her governance, risk, and regulatory knowledge and experience of
working with listed companies. We wish her the very best for the
future."
"We are delighted to welcome Joanne to the board. Joanne is a
chartered accountant with a strong financial and City background
and brings a wealth of experience to the board and will be a
tremendous asset to the Group as we further our growth agenda."
Joanne presently holds the following roles in publicly quoted
companies: the non-executive Chairman of AIM-quoted Made Tech Group
plc, a leading provider of digital, data and technology services;
the non-executive deputy chairman of Main Market-listed land
promotion, property development and investment, and construction
group, Henry Boot plc; a non-executive director of Gateley
(Holdings) Plc, the AIM-listed legal and professional services
group; a non-executive director of AIM-quoted consumer finance
provider, Morses Club Plc; and a non-executive director of
Honeycomb Investment Trust plc, the Main Market-listed specialist
lender and investor in credit assets. Joanne is also non-executive
Chairman of AIM-quoted wealth and investment management group,
Mattioli Woods plc, where she has been a director since July 2012,
but is due to step down from the board imminently once regulatory
approval has been received for her successor. Joanne was previously
also a non-executive director of AIM-listed Accrol Group Holdings
plc until October 2018.
There is nothing further to disclose pursuant to Listing Rule
9.6.13 in respect of Joanne Lake.
*Revenue and underlying operating profit excludes specific
acquisition and disposal related items and the results of Cory
Brothers which will be included in the full year results as
'discontinued operations' due to the planned disposal.
For further information, contact:
Braemar Shipping Services
James Gundy, Group Chief Executive Tel +44 (0) 20 3142 4100
Officer
Nick Stone, Chief Financial Officer
Investec Bank plc
Chris Treneman / Gary Clarence / Alex Tel +44 (0) 20 7597 5970
Penney / Alice King
Buchanan
Charles Ryland / Victoria Hayns / Tel +44 (0) 20 7466 5000
Stephanie Whitmore / Matilda Abraham
Notes to Editors:
About Braemar Shipping Services Plc
Braemar is a leading international Shipbroker and provider of
expert advice in shipping investment, chartering and risk
management. Braemar employs approximately 520 people in 30 offices
worldwide across its Shipbroking, Financial and Logistics
divisions.
Braemar joined the Official List of the London Stock Exchange in
November 1997 and trades under the symbol BMS.
For more information, including our investor presentation, visit
www.braemar.com
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