Financial Express (Holdings) Limited (“we”, “our”, “us” and derivatives) are committed to protecting and respecting your privacy. This Privacy Policy, together with our Terms of Use, sets out the basis on which any personal data that we collect from you, or that you provide to us, will be processed by us relating to your use of any of the below websites (“sites”).

  • FEAnalytics.com
  • FEInvest.net
  • FETransmission.com
  • Investegate.co.uk
  • Trustnet.hk
  • Trustnetoffshore.com
  • Trustnetmiddleeast.com

For the purposes of the Data Protection Act 1998, the data controller is Trustnet Limited of 2nd Floor, Golden House, 30 Great Pulteney Street, London, W1F 9NN. Our nominated representative for the purpose of this Act is Kirsty Witter.

WHAT INFORMATION DO WE COLLECT ABOUT YOU?

We collect information about you when you register with us or use any of our websites / services. Part of the registration process may include entering personal details & details of your investments.

We may collect information about your computer, including where available your operating system, browser version, domain name and IP address and details of the website that you came from, in order to improve this site.

You confirm that all information you supply is accurate.

COOKIES

In order to provide personalised services to and analyse site traffic, we may use a cookie file which is stored on your browser or the hard drive of your computer. Some of the cookies we use are essential for the sites to operate and may be used to deliver you different content, depending on the type of investor you are.

You can block cookies by activating the setting on your browser which allows you to refuse the setting of all or some cookies. However, if you use your browser settings to block all cookies (including essential cookies) you may not be able to access all or part of our sites. Unless you have adjusted your browser setting so that it will refuse cookies, our system will issue cookies as soon as you visit our sites.

HOW WE USE INFORMATION

We store and use information you provide as follows:

  • to present content effectively;
  • to provide you with information, products or services that you request from us or which may interest you, tailored to your specific interests, where you have consented to be contacted for such purposes;
  • to carry out our obligations arising from any contracts between you and us;
  • to enable you to participate in interactive features of our service, when you choose to do so;
  • to notify you about changes to our service;
  • to improve our content by tracking group information that describes the habits, usage, patterns and demographics of our customers.

We may also send you emails to provide information and keep you up to date with developments on our sites. It is our policy to have instructions on how to unsubscribe so that you will not receive any future e-mails. You can change your e-mail address at any time.

In order to provide support on the usage of our tools, our support team need access to all information provided in relation to the tool.

We will not disclose your name, email address or postal address or any data that could identify you to any third party without first receiving your permission.

However, you agree that we may disclose to any regulatory authority to which we are subject and to any investment exchange on which we may deal or to its related clearing house (or to investigators, inspectors or agents appointed by them), or to any person empowered to require such information by or under any legal enactment, any information they may request or require relating to you, or if relevant, any of your clients.

You agree that we may pass on information obtained under Money Laundering legislation as we consider necessary to comply with reporting requirements under such legislation.

ACCESS TO YOUR INFORMATION AND CORRECTION

We want to ensure that the personal information we hold about you is accurate and up to date. You may ask us to correct or remove information that is inaccurate.

You have the right under data protection legislation to access information held about you. If you wish to receive a copy of any personal information we hold, please write to us at 3rd Floor, Hollywood House, Church Street East, Woking, GU21 6HJ. Any access request may be subject to a fee of £10 to meet our costs in providing you with details of the information we hold about you.

WHERE WE STORE YOUR PERSONAL DATA

The data that we collect from you may be transferred to, and stored at, a destination outside the European Economic Area (“EEA”). It may be processed by staff operating outside the EEA who work for us or for one of our suppliers. Such staff may be engaged in, amongst other things, the provision of support services. By submitting your personal data, you agree to this transfer, storing and processing. We will take all steps reasonably necessary, including the use of encryption, to ensure that your data is treated securely and in accordance with this privacy policy.

Unfortunately, the transmission of information via the internet is not completely secure. Although we will do our best to protect your personal data, we cannot guarantee the security of your data transmitted to our sites; any transmission is at your own risk. You will not hold us responsible for any breach of security unless we have been negligent or in wilful default.

CHANGES TO OUR PRIVACY POLICY

Any changes we make to our privacy policy in the future will be posted on this page and, where appropriate, notified to you by e-mail.

OTHER WEBSITES

Our sites contain links to other websites. If you follow a link to any of these websites, please note that these websites have their own privacy policies and that we do not accept any responsibility or liability for these policies. Please check these policies before you submit any personal data to these websites.

CONTACT

If you want more information or have any questions or comments relating to our privacy policy please email publishing@financialexpress.net in the first instance.

 Information  X 
Enter a valid email address

Brambles Industries (BI.)

  Print      Mail a friend

Tuesday 31 August, 2004

Brambles Industries

Final Results - Part 3

Brambles Industries PLC
31 August 2004


TRADING PERFORMANCE
----------------------------

As expected, solid progress was achieved in the year, with trading performance
in the second half much stronger than the first half.

Sales from continuing businesses were £3.1 billion, an increase of 7%. Sales for
CHEP, Cleanaway and Recall grew by 9%, 8% and 6% respectively, and grew in constant 
currency by 11%, 5% and 8% respectively.

Comparable operating profit (profit before interest, tax, goodwill amortisation
and exceptional items) from continuing businesses was £380 million compared with
£359 million the previous year, an increase of 6%. The second half of the year
in constant currency terms was 29% above the first half.

Profit before tax, goodwill amortisation and exceptional items was £307 million
compared with £286 million in the previous year, an increase of 7%. Earnings per 
share before goodwill amortisation and exceptional items were 12.4 pence compared with 
11.5 pence in the previous year, an increase of 8%.

Profit before tax after goodwill amortisation and exceptional items was 
£224 million compared with £190 million in the previous year, an increase of 18%, 
or 16% in constant currency.

Brambles Value Added (BVA), calculated as comparable operating profit less a 12%
capital charge, was £4 million for the year, an improvement of £16 million.

Brambles generated free cash flow of £249 million, a surplus of £110 million
after dividends. Operating cash flow after gross capital expenditure improved
significantly to £339 million. All divisions remain firmly focused on the more
efficient use of assets (utilising the BVA methodology) and on cash generation.

CHEP delivered strong growth in comparable operating profit which at 
£224 million was an increase of 13%, and in constant currency an increase of 14%.
Sales growth was 9%, equivalent to 11% in constant currency, and capital
expenditure fell £64 million, to £264 million. Solid sales growth, lower costs
and the non-recurrence of one-off first half charges in the USA saw the comparable
operating profit for CHEP Americas increase 89% in the second half over the
first in constant currency. Expenditure on the restructuring of CHEP Europe,
announced in November 2002, was in line with expectations and a net headcount
reduction of 350 has been achieved.

As expected, Cleanaway's comparable operating profit for 2004 was £89 million,
down 7% and in constant currency down 10%. However, Cleanaway improved its comparable
operating profits by £3 million in the second half of the year due to
significantly improved results in the UK.

As anticipated, Recall had a challenging year with comparable operating profit
12% lower, a decrease in constant currency of 10%, due to the performance of its
European operations though all regions delivered constant currency sales growth.
Recall is expected to resume profit growth in 2005.

Brambles Industrial Services achieved a 21% improvement in comparable operating
profit, an increase in constant currency of 14%, on slightly lower sales and
had another strong year of generating operating cash flow.

Regional Businesses delivered 25% growth in comparable operating profit to 
£5 million, led by a turnaround in Interlake.
                                        
                                        6
                                        
The effects of currency are shown in tabular format on page 4.


EXCEPTIONAL ITEMS
-----------------

Exceptional charges of £48 million (£50 million after tax) resulted principally
from a write-down in the carrying value of goodwill in Interlake (£19 million),
the completion of costs related to the restructuring of CHEP Europe (£38
million), the reorganisation of CHEP's global management structure (£6
million) and Cleanaway restructuring (£9 million), offset in part by the gain on sale of
Meineke Car Care Centers (£30 million). Brambles announced at the half year that
it had adopted a prudent approach to the carrying value of Interlake by writing
off the entire goodwill. The decision was made in the light of Interlake's
medium term profitability and notwithstanding some improvement in current
trading.

A total of £88 million has been charged on the reorganisation in CHEP Europe
since the start in November 2002, and the expenditure has now been completed.

FINANCIAL POSITION
------------------

Cash flow from operations after gross capital expenditure again improved
significantly, up by £111 million to £339 million. Free cash flow of 
£249 million was £157 million higher than the previous year and was more than
sufficient to pay the dividends of £139 million.

Net interest expense was £74 million compared with £83 million in the previous
year with the improvement mainly due to lower interest rates and some favourable 
exchange rate movements.

Working capital in continuing businesses improved significantly and was reduced
by £54 million. In particular, debtor days were reduced in CHEP Americas and
Europe, Cleanaway UK and Recall Europe.

Net debt declined by £212 million to £1,395 million at 30 June 2004. Financial
coverage ratios continued to improve, with EBITDA interest cover at 9.6 times 
(2003:8.3 times) and net debt/EBITDA at 2.0 times (2003:2.3 times).

In August 2004, after the end of the financial year, Brambles completed a US
private placement debt raising of US$425 million (approximately £233 million) 
with maturities in seven, ten and twelve years. The proceeds were used to repay 
bank debt.

CAPITAL EXPENDITURE
-------------------

Capital expenditure for the year was £398 million, significantly lower than the
£456 million in the previous year and reflected the disciplined approach adopted.

In CHEP, capital expenditure at £264 million was £64 million below the previous
year. The principal driver of the reduction was CHEP Americas, where capital
expenditure reduced by £62 million as a result of a one-time reduction in pallet
stocks and ongoing improvements in asset management. Capital expenditure in CHEP
Europe also reduced and at £125 million was £6 million below the previous year.
Expenditure in CHEP Rest of World increased marginally but was significantly 
below the rate of sales growth.

Capital expenditure in Cleanaway was £82 million (up £3 million to support new
municipal contracts), in Recall £26 million (up £3 million, particularly in information
technology) and in Brambles Industrial Services £24 million (up £4 million,
reflecting new contracts particularly in Australia).

The ratio of capital expenditure to depreciation was 1.2 times (2003: 1.4
times).

                                      7
The effects of currency are shown in tabular format on page 4.


BUSINESS DISPOSALS
------------------

The only significant disposal in the period was Meineke Car Care Centers, sold
in August 2003 for net proceeds of £42 million. The resulting profit on sale of
£30 million (£17 million after tax) is shown as an exceptional item.

TAXATION
--------

Brambles' tax rate remained very similar to the previous year at 31.6% of profit
before tax, goodwill amortisation and exceptional items.

The effective tax rate is determined by the geographic mix of earnings. Going
forward there could be a marginal upward trend in the effective tax rate if the 
earnings contribution from the USA continues to rise.

DIVIDEND
--------

The Board has declared a final dividend of 10 cents per share, fully franked, 
for shareholders in Brambles Industries Limited and a second interim dividend of
3.918 pence per share for shareholders in Brambles Industries plc. This is consistent 
with the Board's stated policy of at least maintaining this level of Australian 
dollar dividend per share.The dividend will be paid on 14 October 2004 to those 
shareholders registered on 24 September 2004.

For Brambles Industries Limited shareholders, both the interim and final 2004
dividends are fully franked. It is expected that the dividends are likely to
remain fully franked until at least the end of 2006.

ANNUAL GENERAL MEETING
----------------------

The 2004 Annual General Meeting of Brambles Industries Limited will be held in
Sydney on Tuesday 16 November and the Brambles Industries plc meeting will be
held in London on Tuesday 23 November.

                                       8

The effects of currency are shown in tabular format on page 4.


OPERATIONAL REVIEW
------------------

Throughout this operational review, all amounts quoted at actual exchange rates.
All comparative trading measures referred to are in constant currency. The
underlying constant currency performance is shown in the table on page 4 and a
definition of constant currency is shown on page 3.


CHEP
                                  Year ended   Year ended          % Change
                                 30 June 2004  30 June 2003
                                  Actual £m     Actual £m    Actual     Constant
£m                                                                      Currency
Sales                                 1,394        1,284          9         11
Comparable operating profit 1           224          199         13         14
Operating cash flow after gross
capital expenditure                     202           75                  

1 A definition of comparable operating profit and a reconciliation to statutory
profit before interest and tax of £179 million (2003: £148 million) are shown on
page 23. All percentage comparisons shown below are in constant currency. 
The definition of constant currency is shown in the footnote to the
table on page 3.

As expected, CHEP had a strong performance in the second half with good progress
for the year overall. Sales for the year increased by 11% while comparable
operating profit was 14% above the previous period. All regions improved
operating cash flow after gross capital expenditure.

The CHEP organisational structure was streamlined in June 2004 with the creation
of two major operating regions and the elimination of the CHEP global management
structure. This is expected to result in increased regional accountability and
improved operational efficiency within a more cost-effective organisation. The
one-off cost of £6 million was charged to operating exceptional items in the
year. The key functions of information technology, marketing, product
development and operations continue to be managed globally. All regions retain
the use of standard metrics for business performance measurement. These enhance
our ability to manage the growth and development of the business in a controlled
manner.

CHEP AMERICAS
-------------

Sales in the Americas were £611 million, an increase of 11%, and comparable
operating profit at £73 million was 5% higher. In the Americas, comparable
operating profit in the second half of the year grew by 89% when compared with
the first half due to a combination of lower costs, the non-recurrence of
one-off costs and higher volumes.

Operating cash flow after gross capital expenditure was £112 million, an
increase of £106 million over the previous year. Working capital improved due to
better creditor and debtor management. Capital expenditure was £62 million below
the previous year, partly due to the one-off benefit from the backlog of pallets
being brought back into use during the first half, together with further
improvements in asset control.

As expected, the short term costs of £11 million were completed in the first
half as the backlog of pallets was moved into the new service centres and
repaired.

Plant and other costs in the Americas increased by £8 million, in part due to
this accelerated repair programme. This was largely offset by the successful
management initiative to ensure adherence to CHEP pallet quality standards,
resulting in the appropriate repair of CHEP pallets. The damage ratio 
(the percentage of pallets returning to the service centre which require repair) 
has improved consecutively over the past three halves to June 2004. The lower 
damage ratio achieved over the past six months is expected to be maintained below 
30%. The conditioning ratio (the percentage of pallets returning to the service 
centre which are repaired) is now similar to the damage rate.  

                                        9

The effects of currency are shown in tabular format on page 4.

Over the past year, CHEP USA worked very closely with the new service centre
operators to ensure consistent pallet inspection and repair regimes.

Transportation costs were in line with the previous year despite the additional
activity required in the first half to relocate pallets from temporary storage
locations. Significant improvements were seen during the second half of the year
in the unit cost of delivery and relocation of pallets. Transportation costs reduced
in the second half by £11 million when compared with the second half of the previous
year, with the result that the full year showed no increase.Better utilisation of 
the new service centre network has allowed improved positioning of pallet inventories. 
Transportation arrangements with customers have been changed to allow more 
cost-effective contracting with carriers. A restructure of the collection process 
for a number of total pallet management customers also helped to reduce 
transportation costs in the second half.

The management of the non-participating distributor (NPD) channel has continued
to improve with more than 1,000 pallet recyclers having signed up to return
pallets to CHEP in the USA. Fewer than 4% of total issues from our customers are
now delivered to NPDs, all of which carry a surcharge to better reflect CHEP's 
costs and customer usage of CHEP pallets. Pallet recyclers assist in the 
ongoing improvements in asset control and there has been a substantial 
increase in the number of pallets returned to CHEP in this way.

The annual customer satisfaction survey showed improvements, particularly in the
area of on-time deliveries.

CHEP EUROPE
-----------

Sales in Europe were £616 million, 9% higher than the previous year. Volume growth
was helped in the early part of the year by demand for soft drinks from the hot 
summer in 2003. The implementation of the new activity-based pricing initiatives, 
discussed in more detail below, should be completed in 2005.

Comparable operating profit was 16% higher at £104 million. The combination of
the activity-based pricing initiatives to align pricing with CHEP's costs and
customer usage of CHEP pallets and the other benefits from the restructuring 
programme meant the second half comparable operating profit was approximately 20% 
higher than both the first half and the comparable period in the previous year.

CHEP Europe Restructuring
-------------------------

Expenditure of £88 million on the CHEP Europe restructuring programme is now 
complete.  This is in line with initial estimates made in 2002 at the 
then-prevailing exchange rates. 

The restructuring focused on two improvement programmes:
operational efficiency and asset productivity.The second half of 2004 benefited 
from these programmes by £7 million.  The programmes are expected to deliver 
an incremental benefit of at least this amount again in the year to June 2005.  
The full annualised benefit of this programme will be realised in the year to June 2006.

Operational Efficiency Improvement Programme
--------------------------------------------

A total of £38 million has been incurred on this part of the programme, of which
£16 million was incurred in the year.

The centralised administration centres in the UK and Spain are now operational,
and performing all European finance and administrative processes. There has been
a net headcount reduction of 350 since the restructuring programme commenced.

The activity-based pricing architecture (ABPA) reflects the costs of providing
CHEP pallets to customers, depending upon their usage patterns. ABPA has been 
introduced to ensure that the prices paid by CHEP's customers fairly reflect 
CHEP's costs and customer usage of CHEP 

                                    10
The effects of currency are shown in tabular format on page 4.

pallets in the light of different and changing supply chain conditions. 
In addition, these initiatives are designed to appropriately incentivise CHEP's 
customers to take responsibility for handling and storing CHEP pallets and for 
recording and reporting CHEP pallet movements accurately and in a timely manner.

ABPA has been focused initially on the relatively small number of customers 
where the difference is greatest between CHEP's costs and the revenue generated. 
Many customers in this initial group of customers have had either no or very limited 
increases in their fee rates in the last four or five years. The changed usage 
patterns of some customers coupled with static fees has in some cases necessitated 
significant increases in charges for these customers. However, for most of 
CHEP's customers, the changes will have a much less significant effect. 
For example, it is estimated that in the UK nearly 50% of customers will have 
the capacity under ABPA by changes in their behaviour to maintain or 
reduce their total cost.

The implementation of ABPA is expected to be finalised during 2005.

CHEP is also implementing a number of non-price based operational changes and
initiatives with distributors, transporters and consolidators designed to
further improve pallet control.

Asset Productivity Improvement Programme
----------------------------------------

A total of £50 million has been incurred on this part of the programme, with £22
million charged to operating exceptional costs in 2004.

Excellent progress has been made in the last 18 months to improve the asset
productivity of the European pallet pool. The initiatives include a more
extensive structured annual audit programme for manufacturer and distributor
customer locations, a new vehicle-based collection service and greater use of
telesales contacts with customers. As a result of these and other similar
programmes, capital expenditure has declined by £6 million versus the previous
year to £125 million, despite an increase in sales.

CHEP - Rest of World
--------------------

Sales in the CHEP businesses in the rest of the world remained strong and
for the year were £167 million, an increase of 16%. The pallet business
continued to show good growth and the returnable plastic containers and
automotive container businesses continued to gain from the roll out of new
contracts. Asset productivity initiatives continued to drive strong financial
returns.

Comparable operating profit was £47 million, 27% above the previous year.

                                       11

The effects of currency are shown in tabular format on page 4.


CLEANAWAY

                                 Year ended     Year ended         % Change
                                 30 June 2004  30 June 2003
                                   Actual £m     Actual £m    Actual   Constant
£m                                                                      Currency
Sales                                1,037           964          8          5
Comparable operating profit 1           89            96         (7)       (10)
Operating cash flow after gross
capital expenditure                     70            84                    

1 A definition of comparable operating profit and a reconciliation to statutory
profit before interest and tax of £60 million (2003: £76 million) are shown on
page 23. All comparative trading measures shown below are in constant
currency. The definition of constant currency is shown in the footnote to the
table on page 3.

Sales were £1,037 million, an increase of 5% but comparable operating profit was 10% 
below the previous year, due to the challenging environment in Germany and weak 
first half in the UK. £4 million of the £7 million reduction in comparable 
operating profit resulted from increased pension costs in the UK although, as 
expected, the UK business performed markedly better in the second half.

Operating cash flow after gross capital expenditure was strong at £70 million,
but lower than the previous year due mainly to the lower profit and some increase
in capital expenditure, largely to support new municipal contracts. Working
capital improved and debtor days in the UK reduced.

Restructuring costs of £9 million have been charged in the period as an
operating exceptional cost within Cleanaway. This reflects the restructuring
undertaken in Germany and to a lesser extent in the UK and is expected to bring
incremental benefits in the UK and in part offset the adverse financial impact
of the DSD re-tendering in Germany. Following disappointing performance due to 
gas shortfalls at Cleanaway's landfill-gas-to-energy business in Taiawan, an 
operational review resulted in an asset write-down of £3 million which is shown
as an exceptional item. 

In all its businesses, Cleanaway's global quality programme 'Clean Run' is
becoming embedded and is facilitating sustainable improvements to customer
service and productivity.

UK
--

In the UK, sales were £467 million, an increase of 6%. However, comparable
operating profit was the same as the previous year, principally due to the
additional pension contributions of £4 million, following the latest actuarial
valuation.

The municipal business continued to show strong growth, assisted by the
commencement of a contract in Croydon (with sales of approximately £91 million
expected over seven years), contract extensions at Tower Hamlets and Lambeth and
new wins such as a significant Essex Civil Amenity site. In 2004 Cleanaway has
achieved a success rate on tenders of around 50% and the municipal order book at
the end of June stood at £776 million.

The commercial and industrial (C&I) business remained under pressure in a
competitive market. Improvements were seen in the second half of the year, as
price increases and the improved focus on customer segmentation and individual
customer profitability took effect. Customer service also improved, with the
number of 'missed lifts', a key measure of service, reducing significantly. New
contracts signed included that with the Compass Group.

Technical Waste, now part of the new Recycling and Disposal Services business,
continued to be impacted by depressed conditions in the pharmaceutical and
chemical industries.

                                       12

The effects of currency are shown in tabular format on page 4.

Market growth will increasingly be driven by the requirements of the UK Landfill
Directive. Cleanaway's proven expertise in advanced waste technologies continues
to position it to benefit from this trend towards increased recycling of waste,
which is strongly endorsed by the UK Government. Stringent recycling targets
have been placed on local authorities. The new Materials Recycling Facility site
in Greenwich (built at a cost of £7 million) is due to commence operations in
December 2004.

The re-organisation of the UK business into more customer-focused segments
together with savings in central overhead costs are expected to benefit this
business in 2005.

Germany
-------

In Germany, sales of £343 million and comparable operating profit were both below
the previous year in constant currency, as expected, due to re-tendered
contracts, the impact of the drinks container deposit directive and lower
average waste paper prices.

In the first round of DSD re-tendering, approximately 50% of Cleanaway's
contracts were awarded for three years and the remainder for one year. The new
contracts commenced on 1 January 2004. Cleanaway's sales from DSD remained
stable through market share gains, albeit at lower prices. The resulting
pressure on margins was in part mitigated by a restructuring programme which has
seen a significant headcount reduction over the last 18 months. It is expected that
the results of the second round of re-tendering will be confirmed shortly.

Cleanaway Germany also continued to extend its municipal business, entering into
a partnership with the municipal authority in Dresden through a joint venture
arrangement.

Australia/New Zealand/Asia
---------------------------

The performance in Cleanaway Australia and New Zealand was satisfactory, with
sales at £196 million, 11% higher than the previous year. The municipal business
continued to benefit from recent contract wins, helped by the impact of new
technology such as routing software and bio-insert bins for green waste. It also
achieved a 100% success rate on re-tenders including the Maroochy Shire, 
Cleanaway's largest municipal contract, which was extended for a further seven years. 
The municipal contract order book increased to £265 million (A$692 million) 
at the end of June 2004. Competition remained difficult in the C&I market, particularly in
Queensland. As in the UK, improving customer service is a critical focus.

As noted above, following disappointing performance due to gas shortfalls at 
Cleanaway's landfill-gas-to-energy business in Taiwan, an operational review
resulted in an asset write-down of £3 million which is shown as an exceptional 
item. The rest of Cleanaway's Taiwanese and other Asian businesses continued to
perform in line with expectations.

                                        13
The effects of currency are shown in tabular format on page 4.


RECALL
------

                               Year ended     Year ended          % Change
                               30 June 2004  30 June 2003
                                Actual £m     Actual £m       Actual    Constant
£m                                                                      Currency
Sales                                  274           258          6          8
Comparable operating
profit 1                                43            49        (12)       (10)
Operating cash flow after
gross capital expenditure               36            33                   

1 A definition of comparable operating profit and a reconciliation to statutory
profit before interest and tax of £30 million (2003: £37 million) are shown on
page 23. All comparative trading measures shown below are in constant
currency. The definition of constant currency is shown in the footnote to the
table on page 3.

Recall's sales grew by 8%, of which 6 percentage points represented organic growth. 
The Americas accounted for 49% of the total sales and Europe 30%. A number of small
acquisitions were made during the period for a total consideration of £14 million 
and included businesses in the key markets of Houston and Sydney.

As had been expected, comparable operating profits for the year were below the
previous year by 10%, although margins in North America were maintained. In
Europe, the comparison with the previous year was impacted by the previous year's 
insurance claim receipt (£2 million), the reduction in paper prices, and the 
impact of increased customer churn, pricing pressures and currently underutilised 
storage capacity, particularly in the UK.

The Document Management Services (DMS) business accounted for 57% of Recall's
sales. DMS sales were 7% above the previous year, with new major contract wins
in South America including the court of justice system of the State of Sao Paulo
(Tribunal de Justica). In North America, the second half of the year saw lower
destruction rates and reduced customer turnover levels, both of which supported
improved performance. The profit decline in Europe was predominately due to a
weaker performance in the UK where Recall's relatively high cost base has led to
some pressures in a competitive environment. This cost base, which has not been
adjusted quickly enough to the competitive environment, is under review.

Although waste paper prices in Secure Destruction Services (SDS) in North
America have recovered from the low levels seen in 2003, they remained below the
previous year's levels in Europe. Results from the UK were impacted by pricing
pressures and customer losses, though the second half performance was somewhat
better. The overall sales growth rate for SDS was 4%.

In North America, new contract wins by Data Protection Services (DPS) were
slower to commence than expected impacting sales growth. Overall, DPS sales grew
by 3%, whilst recent contract wins in the USA and Europe meant that the
Integrated Data Services business grew by 57%.

Despite the lower profitability in 2004, improvements in working capital saw
Recall's cash flow after gross capital expenditure increase by £3 million to £36 million. 
Recall's debtors outstanding were reduced as a result of improved collections in
all regions.

Changes have been made during the year to strengthen the management team in
Europe. The latter part of the year saw improved growth in the number of cartons
being stored in DMS. Trial initiatives to improve route planning and despatch in
SDS have resulted in both lower costs and improved customer service levels and
are now being rolled out more widely.

Recall's established geographical coverage, high quality product offerings and
strong focus on customer service position it well for continued organic sales
growth in 2005.

                                    14
The effects of currency are shown in tabular format on page 4.


BRAMBLES INDUSTRIAL SERVICES
----------------------------

                                 Year ended     Year ended        % Change
                                30 June 2004   30 June 2003
                                  Actual £m     Actual £m   Actual     Constant
£m                                                                     Currency
Sales                                  287           282          2         (4)
Comparable operating profit 1           34            28         21         14
Operating cash flow after gross
capital expenditure                     38            41                       

1 A definition of comparable operating profit and a reconciliation to statutory
profit before interest and tax of £26 million (2003: £23 million) are shown on
page 23. All comparative trading measures shown below are in constant
currency. The definition of constant currency is shown in the footnote to the
table on page 3.

Comparable operating profit in Brambles Industrial Services at £34 million
was 14% higher than the previous year. All regions showed profit improvements. 
Sales were 4% lower than the previous year, reflecting the disposal of a number 
of small non-core industrial maintenance and cranes businesses particularly in 
Australia. If the impact of these disposals was excluded, sales would have been
higher year on year.

The increased focus on selected industries and key customers has resulted in
significant improvements in comparable operating profit margins which are now 
nearly 12%. The committed order book at the end of June 2004 was almost £1 billion.

Operating cash flow after gross capital expenditure remained strong at £38 million
(2003: £41 million). Capital expenditure increased by £4 million to £24 million
to support new contracts, particularly in Australia.

The Australian business represented approximately 50% of the total of Brambles
Industrial Services sales. Despite the previously mentioned divestments, profits 
increased marginally. All contracts due for renewal during the year were secured, 
as were a number of new contracts in the coal, gold, steel and chemical industries. 
In the Northern Hemisphere, new contracts were won at Celsa, Cardiff and Arcelor, 
Dunkirk. Volumes elsewhere also improved, particularly at Port Talbot and 
Teesside in the UK, at the French Industrial Logistics business and at each site 
in the USA.

Brambles Industrial Services continues to add value to customers' processes,
bringing in-depth technical knowledge and strong, focused positions in a
selected number of industrial sites. Further steady growth is anticipated.

                                    15
The effects of currency are shown in tabular format on page 4.


REGIONAL BUSINESSES
-------------------

                                Year ended     Year ended        % Change
                                30 June 2004  30 June 2003
                                  Actual £m     Actual £m     Actual    Constant
£m                                                                      Currency
Sales                                  117           121         (3)         6
Comparable operating profit 1            5             4         25         25
Operating cash flow after gross
capital expenditure                      7             8          

1 A definition of comparable operating profit and a reconciliation to statutory
loss before interest and tax of £16 million (2003: £nil) are shown on page 23. 
All comparative trading measures shown below are in constant currency. The
definition of constant currency is shown in the footnote to the table on page 3.

In the Interlake racking business, market conditions improved from the second
quarter but softened somewhat in the latter part of the year due to steel price
increases. A cost reduction programme which included moving production to lower
cost facilities had a positive effect. The goodwill of £19 million in respect 
of Interlake was written off in the first half.

The operating environment of Eurotainer remained difficult due in part to the
weakness of the US dollar. The fleet utilisation rate increased progressively
during the year.

TCR, though still a small business, showed good sales growth resulting from the
recent contract wins at major airports in the UK and the Netherlands.
                                        
                                       16
The effects of currency are shown in tabular format on page 4.


OUTLOOK 
--------

CHEP is continuing to trade well in the early part of the current year.It is 
expected that CHEP Americas will see continued sales growth and ongoing gains 
from the cost reduction programmes already implemented. In CHEP Europe the 
implementation of activity-based pricing initiatives designed to align pricing 
with CHEP's costs and customer usage of CHEP pallets are expected to be completed 
during 2005 and further benefits will be gained from the restructuring programme. 
CHEP's business in the rest of the world should continue to grow.

Cleanaway in the UK is expected to show improvements across all business
segments, although Germany will continue to be affected by the DSD re-tendering.
In Australia, the commencement of municipal contract wins should result in
further progress, albeit tempered by ongoing pricing pressure in some regions.

Recall is expected to achieve continued sales growth in all regions and profits
are expected to improve. The European business should recover and make progress
through reducing its cost base and improving its competitive position. North
America and Australia are expected to show good growth in the current year.

Brambles Industrial Services is likely to benefit from continued high levels of 
activity across many commodities, including steel. Its innovative service offerings 
should result in continued opportunities for steady growth.

We are targeting continued generation of free cash flow as the concentration on
value management continues across Brambles.

In summary, the business is performing well in the early part of the current 
financial year and this, together with our focus on further operational
improvements, is expected to form the basis for good progress in 2005.

                                       17

The effects of currency are shown in tabular format on page 4.









                      This information is provided by RNS
            The company news service from the London Stock Exchange