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Havelock Europa PLC (HVE)

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Friday 29 June, 2001

Havelock Europa PLC

AGM Statement

Havelock Europa PLC
29 June 2001

                                                                  29 June 2001

                             HAVELOCK EUROPA PLC


At the AGM today of Havelock Europa PLC, the retail interiors and point of
sale display group, the Chairman, Michael Kennedy, made the following remarks:


'The Group has had a mixed start to the year.  The Point of Sale companies
have made a good recovery; Showcard Print particularly so.  A major expansion
in the breadth of the customer base has been achieved with further penetration
of the supermarket sector, thus diluting the traditional dependence on fashion
retailers.  The capital investment that took place last year in Showcard
Print, particularly in the field of direct projection, has paid considerable
dividends and a similar programme is planned to be completed in Hartcliffe by
the early autumn.  The new emphasis on global brands continues and point of
sale display work is now in hand for Reebok, Scottish Widows, Granada, Dyson
and Denby Pottery, to add to the existing business with Virgin Mobile.

The Retail Interiors Division has had a very slow start to the year, as a
result of the well publicised difficulties of some of its major customers in
the non-food retail sector.  The general level of refurbishment programmes
throughout this sector, planned for the current year, appears to be lower than
for some time.  Additionally, the merger activity taking place in the banking
sector has also had an effect in slowing down or deferring capital investment
in this market.

In contrast, the Group's Joint Venture in the Middle East, Havelock AHI WLL,
has experienced buoyant conditions, particularly in the retail sector, where
the rate of new investment in shopping centres and hypermarkets is at an
unprecedented level throughout the Gulf region. The Joint Venture's turnover
for the first five months of this year (of which Havelock Europa consolidates
half) was double that for the same period in 2000. The contribution from the
Joint Venture in the first half of the year will be above original
expectations and well above that for the same period last year.


With work almost completed for two new Debenhams' stores, in Qatar and Riyadh,
and a contract in place for a new store for Marks & Spencer, also in Riyadh,
as well as significant work in hand for Sheraton Hotels in Kuwait and two
Holiday Inns in Saudi Arabia, the Joint Venture now requires substantial
additional woodworking facilities.

The Joint Venture has, therefore, reached conditional agreement to buy the
factory and fixed assets of the Bahraini Light Industries Company (BLICO), a
manufacturer of office and hotel furniture, for the sum of Bahraini Dinars
775,000 (£1.45 million at the exchange rate at close of business on 27 June

The BLICO factory extends to 13,400 square metres, effectively doubling the
Joint Venture's manufacturing and warehousing space as well as adding
significantly to the range of woodworking machinery available to the business.

BLICO is quoted on the Bahraini Stock Exchange and the purchase is
conditional, amongst other things, on receiving the consent of the
shareholders of BLICO at an Extraordinary General Meeting to be held on 2 July
2001. The purchase will be funded from the existing cash resources and bank
facilities available locally to the Joint Venture.  In May, the Joint Venture
repaid all of its outstanding loans to Havelock Europa PLC, amounting to £
191,000. Havelock AHI made a contribution to the profits of Havelock Europa of
£374,000 in the year to 31 December 2000.


Overall, the Group results for the first half will be affected, as usual, by
the very high seasonal bias towards the second half of the year.  Whilst the
level of activity in the Retail Interiors Division is likely to be
substantially less than in 2000, as a result of difficult market conditions,
this is likely to be mitigated by a strong recovery at Showcard Print and
further good progress in the Middle East.

The Board continues to believe that there is scope for corporate
rationalisation within its sector and the Company is vigorously investigating
any such opportunities which would be to the advantage of shareholders and


During May, 1,550,000 shares in the Company were acquired by two Swiss banks.
In accordance with its normal procedures, the Company requested the registered
owners to reveal the identity of the beneficial owners but they have declined
to disclose this information. These shares, which represent 5.5% of the
Company's issued ordinary share capital, have accordingly been
disenfranchised, in accordance with our Memorandum and Articles of
Association, until such time as the required information is provided.  In
addition, the registered owner of one of these share holdings has recently
acquired further shares increasing their holding above 3% of the issued share
capital of the Company and has failed to notify the Company of this interest,
in terms of the Companies Act 1985. The shares now held by these registered
owners total 7% of the Company's issued share capital. The Company is
implementing its normal procedure in respect of these further shares.'


Havelock Europa PLC                                                01383-820044
  Hew Balfour  (Chief Executive)                           Mobile: 07801-683851

Bankside Consultants Limited                                    020-72 20 74 77
  Charles Ponsonby