Mears Group PLC Pre-Close Trading Update (2652D)
June 25 2019 - 2:01AM
UK Regulatory
TIDMMER
RNS Number : 2652D
Mears Group PLC
25 June 2019
25 June 2019
Mears Group PLC
("Mears" or "the Group")
Pre-Close Trading Update
Mears Group PLC (LSE: MER), the provider of support services to
the Housing and Care sectors in the UK, today issues a pre-close
trading update ahead of its interim results for the six months to
30 June 2019.
During the half year, Mears continued to make solid progress
with its plans. The anticipated results for the financial year to
31 December 2019 continue in line with previous guidance.
At the start of the year, Mears announced that it had been
successful in securing three regions of the Asylum Accommodation
and Support Contract ('AASC') with an estimated contract value of
GBP100m per year over a ten year period. The first half of 2019 has
seen an intensive period of mobilisation and this will continue
into the second half. A fuller update will be provided within the
Group's interim statement.
Mears completed the acquisition of certain business assets and
contracts from the property maintenance business of Mitie ('MPS')
in November 2018. The integration of MPS is progressing well with
the migration of the three operating systems onto the single Mears
Contract Management platform on-track for a target completion in
September 2019. Good progress has been made in securing synergies
through the business combination and delivering operational
improvements.
In March 2019 the Group stated its intention to reposition its
Development activities and, as current contractual obligations
unwind, it will no longer participate in those contracts that have
a high requirement for working capital funding. The Group has
already made solid progress towards achieving that aim.
A property acquisition facility of GBP30m was introduced in 2017
to enable the Group to acquire and build portfolios of properties
prior to their disposal to long term funding partners. The Board
previously indicated its desire to unwind and cancel this facility
during the course of 2019. Good progress has been made in this area
with the facility reduced to GBP15m during the first half and there
is visibility of a further reduction in the second half.
Mears continues to place great emphasis on managing working
capital tightly. The Group expects to report a small reduction in
the average daily net debt in the first half year compared with the
average net debt reported for the 2018 financial year.
Mears will announce its interim results on Tuesday 13 August
2019.
David Miles, Chief Executive of Mears Group, commented:
"I am very satisfied with the progress made in the first half of
2019 particularly against the well documented challenges others
have and are experiencing with the support services arena.
"A significant amount of time and focused effort has been
directed towards the integration of MPS and the mobilisation of
AASC. I am confident that the Group is well placed to benefit from
this up-front investment. Our well proven and unique approach to
contract mobilisation remains one of our key differentiators.
"The Board continues to accelerate the unwinding of the working
capital absorbed within Development activities announced three
months ago. We will ensure that the Group remains well-positioned
to contribute to the housing development needs of our
customers."
For further information, contact:
Mears Group PLC
David Miles, Chief Executive Tel: +44(0)7778 220 185
Andrew Smith, Finance Tel: +44(0)7712 866 461
Director
Alan Long, Executive Tel: +44(0)7979 966 453
Director
www.mearsgroup.co.uk
Buchanan
Mark Court, Sophie Wills Tel: +44(0)20 7466 5000
mears@buchanan.uk.com
About Mears
Mears employs over 10,000 people and provides services in every
region of the UK. In partnership with our Housing clients, we
maintain, repair and upgrade the homes of hundreds of thousands of
people in communities from remote rural villages to large inner
city estates. Mears has extended its activities to provide broader
housing solutions to solve the challenge posed by the lack of
affordable housing. Our Care teams provide support to over 15,000
people a year, enabling the elderly and those living with
disabilities to continue living in their own homes.
We focus on long-term outcomes for people rather than short-term
solutions, and invest in innovations that make a positive impact on
people's quality of life and on their communities' social, economic
and environmental wellbeing. Our innovative approaches and market
leading positions are intended to create value for our customers
and the people they serve while also driving sustainable financial
returns for our providers of capital, especially our
shareholders.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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