Buyout of the Dialight Corporation Pension Scheme
16th March 2011
Dialight plc
Buyout of the Dialight Corporation Pension Scheme
Dialight plc ("Dialight" or the "Group") today announces that it has successfully reached agreement on the buyout of the Pension Scheme ("the Scheme") of its US subsidiary, Dialight Corporation (the "Subsidiary"). In the Group's Preliminary Results announced on 14 February 2011, the Group indicated that the cost of securing these liabilities was expected to be a minimum of £3.0 million, however, the actual cost is lower than anticipated at £2.4 million. The Group will no longer be required to make further cash contributions to the Scheme and associated costs are deductible for tax purposes.
The Subsidiary is a wholly owned US resident division of the Group and, for a number of years, has operated a defined benefit pension plan for certain US employees which is no longer open for accrual.
The buyout removes any further exposure from the liabilities in this Scheme. This has been achieved through providing existing members and beneficiaries the choice to receive an annuity or a lump-sum cash payment in return for agreement to the termination of the Scheme. Annuities have been secured through Prudential and all final cash payments will be made by the end of March 2011.
As at 31st December 2010, the deficit on this Scheme was £1.9 million, following cash contributions of £1.1 million made to this Scheme in 2010 as well as a further £1.1 million in 2009. The latest up-to-date actuarial valuation shows a deficit of £1.7 million. There will be a one-off non-underlying financial expense of £0.7m in the Interim Results for the half year to 30th June 2011.
Roy Burton, Chief Executive, commented: "We are pleased that we have been able to reach agreement on the buyout of our US pension scheme, something that has been very well received by its members and has worked in the best interests of all parties concerned. This agreement means that we have now successfully removed any future exposure to the liabilities of the US Scheme at a lower cost than was originally expected, which has delivered value to shareholders."
For further information:
Dialight plc
Roy Burton, Group Chief Executive
Mark Fryer, Group Finance Director
Tel: 01638 778640
Canaccord Genuity Limited,
Simon Bridges
Tel: 020 7050 6500
Kreab Gavin Anderson
Robert Speed
Andrew Jones
Tel: 020 7074 1800
dialight@kreabgavinanderson.com
About Dialight
Dialight plc is leading the lighting revolution for industrial users across the world. Applying leading edge LED technology it produces retro-fittable lighting fixtures designed specifically for hazardous locations, obstruction lighting, traffic and rail signalling to vastly reduce maintenance, save energy, improve safety and ease disposal. Versions of these high specification luminaires are also produced for more general commercial, industrial and outdoor situations.
Dialight comprises the following business segments:
· Signals/Illumination which addresses the increasing demands for Energy Efficient Lighting solutions through the use of high brightness LEDs and utilisation of a number of associated technologies. Areas of business include Traffic and Rail Signals, Obstruction Lights and Solid State Lighting products.
· Indication components whose sales are primarily to Electronics OEMs for status indication; and
· Electromagnetic components which supplies smart meter disconnect switches which are used by utility companies to manage remotely electrical supply to residential and business premises.
The company is headquartered in the UK and listed on the London Stock Exchange (LSE:DIA.L,GB0033057794) with operating locations in the UK, USA, Denmark, Germany and Mexico. More information is available at www.dialight.com.
This information is provided by RNS