Gavin Slark: delivering sector-leading results.

BSS delivers, despite tough trading conditions

Published:  26 May, 2010

LEICESTER: The BSS Group, distributor to specialist trades, made public its audited preliminary results for the year ended 31 March 2010. Gavin Slark, group chief executive, commented: "We have delivered sector-leading results with revenue growth and earnings resilience despite the toughest year for the economy in more than 70 years.

"A robust balance sheet and strong cashflow has underpinned continued investment in the business throughout the recession. We remain well positioned to take advantage of economic recovery.

"Quarter four results were encouraging and the new financial year has got off to a strong start. Like for like revenue in the first seven weeks of the new financial year is 9.7% up on last year.

"Our confidence in our future performance has increased and we are pleased to recommend a 10% increase in the final dividend."

Financial highlights

* Revenue increased by 0.9% to £1,352.4m (2009: £1,340.6m). Second half revenue was up 7.2% to £701.8m (H2 2009: £654.7m). LFL revenue up 6.6% in Q4 (Q3: -2.6% LFL).

* Like-for-like costs reduced by 5.6% (2009: +2.0%).

* Profit before tax ('PBT') £44.2m (2009: £57.8m).

* PBT £49.6m (2009: £61.2m).

* Final dividend increased by 10% to 6.09p (2009: 5.54p), total dividend 7.98p (2009: 7.43p).

* Free cashflow £21.4m (2009: £27.9m). Net debt £85.3m (2009: £86.0m). Net debt/ EBITDA 1.47 times.

Operational highlights

* Revenue trend improved as the year progressed.

* Core repair and maintenance markets remained resilient throughout the financial year.

* New revenue streams generated £54m, 76% growth on 2009.

* Early cycle recovery in Domestic Division has commenced.

* Market share gains in Industrial Division underpin second half improvement.

* Specialist Division is through the worst and its recovery is under way.

* Continuing to invest in new branches (18 opened); 439 branches now trading. Further organic growth targeted.

* Direct Heating Spares ('DHS') performed ahead of expectations (35% ROCE in year one).

* Focused on growing existing new revenue streams plus new opportunities identified and being pursued.


* Strong start to 2010-11: underlying business building momentum – dividend increase reflects confidence.

* Adjusted profit before tax after adding back exceptional redundancy costs of £3.1m (2009: £1.2m) and amortisation of acquired intangibles of £2.3m (2009: £2.2m).

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