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Interserve’s rescue plan is making good progress ?>

Interserve’s rescue plan is making good progress

International support services and construction group, Interserve, has released a trading update ahead of the announcement of its 2017 full year results stating overall 2017 trading performance before exceptional items is consistent with the trends outlined in the October market update and in-line with market expectations.

The Group anticipates that net debt at year-end 2017 will be circa £513 million, reflecting the significant outflow in the year relating to Energy from Waste, and adds whilst it anticipates that future cashflows from energy from waste will be broadly neutral, it expects net debt to peak in the first half of FY18 due to the phasing of cashflows relating to energy from waste costs which have already been provided, exceptional costs relating to restructuring actions and the current refinancing activity. Discussions with the Group’s lenders are progressing and a further announcement with regards to its longer-term funding arrangements will be made in due course.

In order to establish a strong foundation from which the Group can move forward, the new management team has been engaged in a comprehensive review of the Group’s contract portfolio and a thorough review of the Group’s non-trading balance sheet items, which it says is progressing well and the outcomes will be announced alongside a presentation of the Group’s longer term strategy for value creation at the time of the Group’s 2017 annual results presentation.

The Group also stated it is making good progress with ‘Fit for Growth’, the three-year programme launched by the new management team in October 2017. ‘Fit for Growth’ is focused on increasing the Group’s organisational efficiency, improving Group-wide procurement processes and ensuring greater standardisation and simplification across the business. As a result of the ‘Fit for Growth’ initiatives, the Group’s operating profit for 2018 is now expected to be ahead of current market expectations. 

Debbie White, Interserve’s Chief Executive, said: “The new management team, and the Board, have been working to stabilise the business and provide a sound foundation to continue to serve our customers effectively, underpin our future growth and to restore shareholder value. This work has focused on managing the balance sheet, conducting a thorough assessment of the contract portfolio, and introducing new management disciplines, processes and cost controls under the ‘Fit for Growth’ programme.” 




The post Interserve’s rescue plan is making good progress appeared first on FMJ.

Source: FMJ

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