ELCO Eleco Public Limited Company

 

TIDMELCO 
 
RNS Number : 2451T 
Eleco PLC 
03 June 2009 
 

 
 
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| For immediate release               |                         3 June 2009 | 
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ELECO PLC 
 
 
Specialist provider of offsite building systems and software 
 
 
Trading Update 
 
 
The Board of Eleco plc (the "Company" or "Eleco"), the specialist building 
systems and software group, today issues a trading statement. 
 
 
We reported in the Interim Statement, issued on 26 February 2009, that the 
performance of the Group in the months to come would be dependent to a 
significant degree on an improvement in underlying market conditions and that 
considerable uncertainty in this regard existed. At that time, more recent 
progress in order prospects for the Precast Concrete activities offered grounds 
for cautious optimism that an upturn in performance would become increasingly 
apparent towards the end of the financial year. However, it is now apparent that 
the strong finish to the year, envisaged at the time of the Interim Statement, 
will not now occur owing principally to difficulties affecting our Precast 
Concrete interests. 
 
 
In more recent months, evidence from external sources, as well as our own 
experience, points to a further weakening in the markets for building systems 
products, including those markets in Europe and South Africa which had been 
relatively resilient to that point. 
 
 
More particularly, project orders from which Bell & Webster Concrete was 
expecting to deliver a significant increase in sales in our fourth quarter have 
been confirmed later than expected or have mobilised more slowly than originally 
anticipated. Revenues of our Precast Concrete activities for the four months to 
April 2009 were 46% below those of the same period in the previous year and, 
while revenues and operating performance are expected to improve during the last 
two months of the year, operating profits of Precast are now expected to be 
significantly below previous expectations. 
 
 
Additionally, a significant shortfall in anticipated revenues from Visualisation 
software is expected owing to the disappointing results from the launch of the 
Grand Designs 3D software in the UK and the failure of the appointed distributor 
in the USA to deliver an effective launch of the product in this market. The 
outcome is that Visualisation is not expected to improve on its losses of last 
year. 
 
 
While the continued severe downturn affecting house building markets has 
resulted in modest deterioration in performance of those of our businesses 
focussed in this area, overall these businesses together with our Roofing and 
Cladding operations and our Construction Software activities, which have 
continued to perform creditably, have continued to trade close to expectations. 
 
 
The outcome is that Group results for the year as a whole are now anticipated to 
fall significantly short of previous expectations and no improvement from the 
interim results may be apparent. However, during the year steps have been taken 
progressively, which will have resulted in a reduction in our operating costs of 
GBP2.7m on an annualised basis and capital expenditure is also being carefully 
controlled. Further cost reductions are under review and the results of these 
and a strategic appraisal of performance will be reported with the full year 
results. 
 
 
 
 
John Ketteley 
Executive Chairman 
 
 
 
 
Enquiries: 
 
 
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| Eleco plc                           |                   Tel: 01920 443830 | 
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| John Ketteley (Executive Chairman)  |                                     | 
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| David Dannhauser (Finance Director) |                                     | 
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|                                     |                                     | 
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| Collins Stewart                     |                  Tel: 020 7523 8000 | 
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| Bruce Garrow                        |                                     | 
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|                                     |                                     | 
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| Buchanan Communications             |                  Tel: 020 7466 5000 | 
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| Tim Anderson/Isabel Podda           |                                     | 
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This trading statement may contain 'forward looking statements' that by their 
nature involve uncertainty and risk in relation to future events and future 
market conditions. Many of these uncertainties and risks relate to factors that 
are beyond the Group's control or which cannot be estimated accurately, such as 
market movements, future market conditions and actions by third parties. 
Therefore, it must be appreciated that the actual outcomes or results may differ 
materially from any outcomes or results expressed or implied by such forward 
looking statements. Moreover, nothing contained in this trading statement is 
intended to be or should be construed as a profit forecast. 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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