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”).


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.


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.


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.


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.


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.


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.


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.


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.


If you want more information or have any questions or comments relating to our privacy policy please email [email protected] in the first instance.

 Information  X 
Enter a valid email address

Brambles Industries (BI.)

  Print      Mail a friend

Tuesday 02 September, 2003

Brambles Industries

Final Results - Part 3

Brambles Industries PLC
01 September 2003


Revenue from continuing businesses at £2.9 billion increased by 6% in constant
currency, with CHEP and Recall up 10% and 17% respectively contributing the
major part of the growth.  This achievement was in the face of generally slow
economic growth.

Profit before tax, goodwill amortisation and exceptional items was £286 million
compared with £305 million last year and was in line with the trading update in
June.  Earnings per share on the same basis at 11.5 pence compared with 13.0

Comparable operating profit (profit before tax, interest, goodwill amortisation
and exceptional items) from continuing business was £359 million compared with
£371 million last year.  The prior year included a charge of £21 million
relating to one-off loss provisioning in CHEP USA.

The year saw a strong group cash performance with cash flow from operations
after capital expenditure of £228 million up from £116 million in the previous
year.  This is the result of a continuing focus on more efficient use of assets
and on cash generation.

As advised in last November's trading update, profits at CHEP Europe were lower
than last year. Additional pallet inspection and repair costs and to a lesser
extent slower sales growth in the final quarter offset transport cost
improvements in CHEP USA.  This resulted in a similar comparable operating
profit to the previous year in CHEP Americas.  CHEP's capital expenditure was
15% lower and all regions including the US generated positive operating cash
flow after capital expenditure.

Cleanaway performed very well in a difficult market in Europe, whilst Recall
increased both revenue and comparable operating profits strongly with an
outstanding performance in the second half.

Brambles Industrial Services continued to perform strongly in Australia and
there were encouraging signs of progress in the Northern Hemisphere businesses.
The performance of the Regional Businesses was adversely affected by the
depressed market conditions for Interlake.


Exceptional items of £62 million (£43 million after tax) principally comprised
reorganisation costs in CHEP Europe, which are described later in this release.


Cash inflow from operations after capital expenditure for the Group strengthened
considerably and was up by £112 million to £228 million.  From continuing
businesses the cash flow improved by £139 million to £212 million, compared with
£73 million last year.

Interest expense was £83 million compared with £97 million in the same period
last year, due to both lower average debt levels and lower interest rates.

Working capital, which has been the focus of significant management attention,
was reduced by £27 million of which £21 million was in continuing businesses.
While creditors fell, there was a reduction in debtors of £52 million (£36
million in continuing businesses) compared with June 2002.  There was an 18 day
improvement in the trade debtors days in CHEP Europe, reflecting the
stabilisation and improvement of the new SAP infrastructure.  A further
improvement in debtor performance is expected in the current year.


Net debt at 30 June 2003 was £1.6 billion, with the EBITDA interest cover at 8.3
times and net debt/EBITDA at 2.3 times, leaving ample headroom in Brambles
credit facilities.

Credit facilities were extended during the year and a bank refinancing programme
was successfully completed in June, with total bilateral facilities of £2.5
billion maturing principally in 2006 and 2008.


Capital expenditure for the year was £456 million, compared with £557 million in
the previous year and should remain around this level in the current year.

In CHEP, capital expenditure at £328 million was £56 million below last year.
The principal driver of the reduction was CHEP Americas where capital
expenditure reduced by £37 million.

Capital expenditure in Cleanaway was £79 million (down £5 million), Brambles
Industrial Services £20 million (down £12 million) and Recall £23 million (up £1
million.)  The absence of capital expenditure in respect of discontinued
business accounted for a further £26 million reduction.


The principal businesses divested during the year were Brambles Shipping in
Australia, Heavy Contracting in Europe and the Building Repair and Maintenance
activities of Cleanaway UK.  The proceeds from divestments of £50 million during
the year were substantially received by year end.

Meineke Car Care Systems was sold in August 2003 for US$68 million, the impact
of which will be included in the current financial year.


The group tax rate for the year was 32% of profit before tax, goodwill
amortisation and exceptional items, up from 28% in the same period last year.
The increase in the tax rate for the period was due principally to the absence
of the one-off tax loss benefit in Cleanaway Germany last year.


The Board has declared a final dividend of 10 cents per share for shareholders
in Brambles Industries Limited and a second interim dividend of 4.053 pence per
share for Brambles Industries plc shareholders.  This is consistent with the
Board's stated policy of at least maintaining this level of dividend per share.
The dividend will be paid on 9 October 2003 to those shareholders registered on
19 September 2003.


The 2003 Annual General Meeting of Brambles Industries plc will be held in
London on Tuesday, 21 October and will be followed by the Brambles Industries
Limited meeting on Tuesday, 18 November in Sydney.



                                          12 months         12 months      % Change -
                                         to 30 Jun 03      to 30 Jun 02     Constant 
                                        As        Constant
£m                                   Reported     Currency
Revenue                               1,284       1,319         1,202            10
Comparable operating profit             199         203           207            (2)
Add back one-off loss provision                                    21
Comparable operating profit before      199         203           228           (11)
one-off loss provision
Operating cash flow after capital        75          72             1             -

Revenue from CHEP increased by 10% while comparable operating profit was £199
million. The prior year profit of £207 million included a one-off loss provision
of £21 million.  Excluding this loss provision, CHEP's comparable operating
profit for the year was 11% lower than last year - almost all of which was
attributable to CHEP Europe.


In the Americas and in constant currency, revenue increased by 12% whilst
comparable operating profit was similar to last year.  At reported exchange
rates revenue was £597 million and comparable operating profit was £76 million.

Operating cash flow after capital expenditure improved by £11 million, resulting
in a positive cash flow of £6 million.

In CHEP USA, revenue was 10% higher despite the slowdown in the US economy.  The
Total Pallet Management (TPM) agreements with retailers such as Wal*Mart and The
Home Depot continue to support this revenue growth.  The year also included a
first time contribution from suppliers to Sysco, the largest food services
company in the USA.  Average revenue per pallet remained very similar to the
previous year.

Further progress has been made on the key initiatives to improve performance and
sustain growth:

• Unit transport costs have reduced as a result of the new service
  centre network, which is now fully operational.  The improved locations chosen
  for the network have facilitated the introduction of the new pallet return
  policy by participating distributors and transport optimisation initiatives.
  These improvements have resulted in a reduction of £12 million in transportation
  costs partly offset by additional collections from TPM customers.

• Management of the Non Participating Distributor (NPD) channel
  continued to improve.  Issues from our customers into NPDs reduced to 4.1% of
  total issues in the year from 5.1% in the previous year.  Pallet returns from
  the NPD channel are running at about 78% of issues, up from 56% in the previous


• Agreements have been put in place with over 750 pallet recyclers to
  improve the return of CHEP pallets and further enhance the high pallet control

However, these improvements were offset by the impact on profits of lower sales
growth in the last quarter driven by a slow down in non-food retail sales in the

In addition, a number of costs were incurred during the year which particularly
impacted second half performance.

Service centre costs were £20 million higher than the previous year, with second
half costs up £15 million.  The largest element was £9 million of additional
inspection and repair costs.  This was a consequence of higher repair rates
which resulted from the effort to improve the quality of the pallet pool and
hence increase customer satisfaction through more intense inspection.

In addition, increased service centre costs which related to short term
increases in storage and handling costs were incurred.  These resulted from pool
inefficiencies caused by the build up of excess pallets during the
implementation of the new service centre network.

In the current financial year it is anticipated that revenue growth will
continue.  The improvements in pallet quality will be maintained and this will
result in a higher ongoing level of inspection and repair costs.  Elimination of
the pool inefficiencies noted in the previous paragraph will result in further
short term costs of some £8 million, in respect of storage, handling, repair and
transport. These will decrease during the first half and should be eliminated by
the end of the calendar year.

The benefit of these actions will be seen in capital expenditure in the US,
which should decrease by about US$40 million in the first half year.

Overall, while profits in the Americas in the first half of the current year are
unlikely to exceed those of the second half of last year, they should rebound in
the second half driven by lower costs and continuing revenue growth.

Within the Americas, CHEP's businesses in Mexico, Argentina, Brazil, Chile and
Canada continued to show strong growth, which was supported by increased capital


Comparable operating profit results for CHEP Europe were in line with previous
statements.  Revenue was 7% higher than the previous year at £554 million, with
growth strengthening in the second half to 10%.  The increase was mostly volume
related, supported by key new contracts including San Pelligrino and Nestle
Purina in Italy, Friskies in France and Henkel in Germany, Italy and France.
CHEP's business in Italy in particular is growing very rapidly, albeit from a
small base.

Comparable operating profit was £90 million, 21% below last year.  Comparable
operating margin was 17% in constant currency.  Causes of the decline have been
explained previously and include the impact of service centre fires during the
first half of £4 million, ongoing higher IT costs (largely related to SAP) of £7
million, and an increase of £8 million in relation to the collection, repair and
relocation of pallets.

The introduction of the new IT system created invoicing problems and some
customer dissatisfaction early in the year.  The situation has now improved.


By the end of the year and despite the increased sales revenue, debtors had
decreased by £32 million with trade debtor days improving by 18 days. The
resolution of similar implementation issues with SAP occurred more rapidly in
the USA than in Europe. CHEP Europe is continuing to address these issues and is
expecting to see further improvements in the current year leading to enhanced
customer satisfaction.

Operating cash flow after capital expenditure improved by £65 million to £48
million after a £22 million cash outflow in respect of operating exceptional

CHEP Europe Restructuring

The previously announced restructuring plan, the costs of which are being
treated as an operating exceptional item, is on track.  The restructuring
programme consists of two elements, a reorganisation programme to improve
operational efficiency and an asset productivity improvement programme.

Operational Efficiency Improvement Programme

Reorganisation Plan                         Spent to      Total      Anticipated
                                              Date       Expected      Benefit
£m                                                                  FY04   FY05
Indirect Workforce Reduction                    13          16        6     12
Service Centre Configuration *                   1           1        4      9
Service offering/Product rationalisation/        8          23        3      8
Channel price implementation
Total                                           22          40       13     29

* excludes related capital expenditure

The reorganisation programme to improve operational efficiency and to reduce
cost is proceeding to plan, with £22 million spent or committed in the year, out
of a total estimated cost of £40 million.

Consultation with all the relevant Works Councils and our workforce continues to
proceed well and the consolidation of finance and administrative processes into
two service centres in Spain and the UK is expected to be completed within the
current financial year.  The reduction of the workforce by 300 to 400 employees
should be completed to the same timetable.  By the end of June 2003, there had
been a net reduction of 120 employees.  This element of cost was £13 million
which includes committed expenditure in respect of most of the programme.  Since
most of the actual head count reductions to date occurred in the later stages of
the financial year no significant financial benefit accrued during 2003.

Preliminary results from the study to assess the optimal service centre network
configuration for the pan-European business confirmed that network optimisation
is expected to result in transport savings, which will mainly flow from
co-located collection, inspection, repair and dispatch functions.

The related cost is smaller than expected as the rationalisation will be largely
derived from combining inspection and repair with existing service centres
rather than closures.  There will therefore be some associated capital
expenditure which will be quantified as the plan is refined.


A number of small scale and uneconomic pooled products have already been
discontinued.  The services offered across the pallet pooling business are also
being remodelled to provide a more flexible range of services, a more
appropriate pricing structure and better asset control.  Implementation will
start in the coming months.

Asset Productivity Improvement Programme

Since it was first announced, an enormous effort has been made on the programme
to improve the asset productivity of the European pallet pool.  Approximately
60% of pallets with principal distributors and some 67% of pallets with
manufacturer customers have been audited.  Further reconciliations and audits
are underway.

There has been a relocation of 2.4 million pallets held in CHEP Europe's own
service centre network, with pallets now being correctly positioned to meet
customer demand.

As a result of the intensified audit programme, 1.1 million pallets have been
added back to our manufacturer customers' holdings, with associated revenue
improvements.  Shortfalls at other customers have led to compensation receipts
expected in respect of another one million pallets.

Provisions have been made in relation to a further four million pallets that
were thought during the audit process not to be recoverable.  This is included
within the charge of £28 million which has been incurred to date and is shown as
an operating exceptional item in the accounts.

It is possible that, as the audits progress, further pallets may prove to be
unviable to collect and repair and will need to be written off.  The estimated
programme cost of £45 million should be sufficient to cover that eventuality.
In the ordinary course of business however provisions continue to be made for
ongoing pallet losses.


Revenue growth in these regions remained strong and at £133 million, revenue was
11% higher than the previous year.  The successful launch of new products in
Australia, including the roll out of reusable plastic containers (RPCs) by
Woolworths, a major national retailer, has widened the revenue base.  Revenue
from services other than pallets accounted for 27% of total Asia-Pacific revenue
for the year to June 2003.

Comparable operating profit at £33 million was similar to the previous year,
when there was a higher than normal level of compensation receipts in Australia.

CHEP South Africa continues to perform strongly.


CHEP's Re-useable Plastic Container (RPC) business around the world continues to
grow.  Revenues were £79 million, 11% higher than the previous year with growth
in Europe particularly strong.  Recent agreements include Carrefour and Casino.
The US business was supported by a new agreement with HEB, the largest retailer
in Texas.  Other regions grew strongly.  Significant efforts have been made to
improve operational efficiencies by introducing global best practice in wash
facilities and RPC purchasing.

Revenue from the automotive container business grew by 6% to £54 million.  A new
US contract with TRW Automotive started in the second half.



An important initiative being implemented across CHEP is the drive to improve
customer satisfaction.  CHEP is continuing to grow revenue across all regions.
During the year 17 new contracts, each with annualised revenue in excess of
approximately £1 million were signed. However, the long term prosperity of the
business can only be assured if customers are increasingly satisfied with CHEP's
service offering.  A global quality programme named Perfect Trip has been
launched to measure and improve CHEP's service quality and to achieve the
ultimate objective that every pallet and container must travel through its
customers in a reliable, error-free manner - from delivery through to invoicing.

                                      12 months          12 months       % Change - 
                                     to 30 Jun 03       to 30 Jun 02      Constant

                                    As         Constant
£m                               Reported      Currency
Revenue                              964           941         916            3
Comparable operating profit           96            93          97           (4)
Operating cash flow after             84            80          62            -
capital expenditure

Cleanaway continued to perform satisfactorily despite difficult trading
conditions in some of its market segments.  Overall, revenue in constant
currency was 3% higher, though comparable operating profit was 4% below the
previous year.

Operating cash flow showed significant improvement, with a lower level of
capital expenditure and an improved working capital performance.  Operating cash
flow after capital expenditure was £84 million, up from £62 million in the
previous year.

In the UK, excluding the Building Repair and Maintenance division which was
divested in the year, revenue was 5% higher at £440 million.  Comparable
operating profit however was lower than the previous year.  The UK Dry Waste
business performed robustly.  The Materials Recycling Facility in Rainham,
Essex, is running ahead of expectations and plans for the development of a
further facility in Greenwich were announced in July.  The technical waste
business continued to be adversely affected by the introduction of the Landfill
Directive in July 2002 through a reduction in technical waste volume being
processed through the landfill facilities.  Cleanaway has proved itself a
credible partner in helping its customers achieve the goals set out in the UK
Government's strategy document, 'UK Waste Strategy 2000' and is well positioned
to benefit from the trend towards increased recycling of waste.  Cleanaway UK's
share of the outsourced municipal waste collection market increased in the year,
with contract wins including those in Thurrock, Medway, Croydon and Tower
Hamlets.  The municipal order book was £755 million at the end of June.

In Germany, revenue at £340 million was down by 4% but comparable operating
profit was similar to last year notwithstanding weak economic conditions and the
disruption caused by the implementation of the new drinks container deposit
directive.  This result compares very favourably with Cleanaway's competitors.
High average paper prices, particularly in the early part of the year, had a
positive effect as did a small acquisition in Berlin.


Re-tenders were submitted in May for DSD - the packaging recycling scheme - and
the outcome of this process is expected to be announced shortly.  The new
contracts will be for three years commencing 1 January 2004.  Cleanaway Germany
is actively competing in this process.  In order to mitigate the price erosion
anticipated, a restructuring programme has already commenced which has resulted
in a reduction of Cleanaway's workforce in Germany by approximately 200 people.
Further consolidation of facilities will be considered when the DSD results are

The performance in Cleanaway Australia and New Zealand was very good, with
revenue 4% higher than the previous year at £161 million and comparable
operating profits up strongly.  A number of new municipal and recycling
contracts, such as those in Canberra, Logan City, Cairns and Tea Tree Gully have
supported this growth, as has the absence of the loss making contract in
Brisbane.  The municipal contract order book stood at A$530 million at the end
of June 2003.

In Asia, the trading performance was similar to the previous year, reflecting
the soft Taiwanese economy and a lower level of one-off site remediation
projects.  However, the new landfill gas-to-energy plant in Nanjing, China is
developing in line with expectations.

For the current year in the UK, the Dry Waste outlook remains firm, with a
strong outstanding order book.  The technical waste business is expected to
remain under pressure and additional pension costs in the UK of approximately £4
million may be incurred.

In Germany the market remains uncertain, affected by a combination of the DSD
retendering, the new drinks container deposit directive and the generally weak
German economy.  However, Cleanaway has a strong and efficient facility base
from which to meet these challenges and to benefit from the opportunities which
are expected to arise following this period of considerable change.

The outlook for Cleanaway Australia remains good, underpinned by a strong
municipal contract order book and a growing National Accounts and Recycling

                                  12 months          12 months to     % Change -
                                 to 30 Jun 03         30 Jun 02        Constant
                                  As      Constant
£m                             Reported   Currency
Revenue                           258          269            229           17
Comparable operating profit        49           52             40           30
Operating cash flow after          33           33             12            -
capital expenditure

Recall again had a very successful year, with comparable operating profits in
the second half being particularly strong.  Revenue grew by 17% overall, of
which 8 percentage points were organic growth.  Eighteen acquisitions were made
in the year, including two that provided entry into Sweden and Finland.

In North America, revenue increased by 19%.  There were 11 acquisitions in the
USA during the year which continued the creation of a national network in Secure
Destruction Services (SDS) and expanded the geographical footprint in the
Document Management Services (DMS) business.  Recall now services directly the
key markets of Washington DC and Minneapolis, Minnesota and has recently
expanded into Las Vegas.  A new DMS mega centre has recently been opened in
Boston.  New national US contracts in the SDS business included Wal*Mart

In Europe, acquisitions particularly in the UK, Sweden, Norway, Denmark and
Finland supported revenue growth of 39%.  The acquisition of the Sentinel
business in the UK in March brought with it an efficient DMS facility in
Greenwich, London and provided Recall with an excellent base for growth in the
UK.  Recall's market share in the London area has reached approximately 21%.

Comparable operating profits increased by 30%, producing a comparable operating
margin of 19%.  This was aided by a one-off £1.6 million insurance compensation.
Perfect Order, which is a service improvement programme, was implemented
throughout DMS globally.  The improvement in customer service as a result of
this programme helped to reduce customer losses as well as to gain new accounts,
supporting Recall's high organic growth rate.

Recall's established geographical coverage, high quality product offerings and
strong focus on customer service position it well to continue its organic growth
and acquisition investment strategy in future years.

Recall's cash flow after capital expenditure was strong and increased by £21
million to £33 million in the year.


                                     12 months           12 months     % Change -
                                    to 30 Jun 03        to 30 Jun 02    Constant
                                   As       Constant
£m                              Reported    Currency
Revenue                              282           276         273            1
Comparable operating profit           28            28          31          (10)
Operating cash flow after             41            41          16            -
capital expenditure

Revenue in Brambles Industrial Services (BIS) was 1% higher with comparable
operating profit 10% below the previous year.

Cash flow performance was very strong, with tight management of working capital
and a prudent approach to capital expenditure.  Operating cash flow after
capital expenditure improved from £16 million to £41 million.

The Australian business generated 55% of the total revenue and continued to
benefit from restructuring and re-focusing on a more limited number of core
services.  During the year, some smaller maintenance and cranes businesses were
sold and a large number of major contracts were successfully renewed.  In its
first full year of operation, the Pulverised Coal Injection plant supplying BHP
Steel performed very strongly.


In the Northern Hemisphere, reduced volumes from Corus at Port Talbot in Wales
due to a blast furnace breakdown and a customer bankruptcy held back both
revenue and comparable operating profits.  However, there was some improvement
later in the year with the relighting of the No. 5 blast furnace.  Major
contracts were won with Arcelor for slag handling in Dunkirk, France and with
Celsa in Wales for steel mill and logistics services.

Brambles Industrial Services has in-depth technical knowledge and strong,
focused positions in a selected number of industrial sites.  The confirmation by
Corus that its UK activities will be concentrated at the Port Talbot site is
encouraging.  Port Talbot is the key UK site for BIS.  Benefits from previously
won Arcelor contracts will gradually be felt.  Looking forward, the business
will continue to focus on achieving further operational excellence.

                                    12 months            12 months     % Change -                        
                                   to 30 Jun 03        to 30 Jun 02     Constant
£m                                 As        Constant
                                Reported     Currency
Revenue                              121           129       160           (19)
Comparable operating profit            4             3        10           (70)
Operating cash flow after              8             6         9             -
capital expenditure

The on-going softness in the US economy continued to adversely affect Interlake,
the market leader in the manufacture of container racking in the US.  This has
been further exacerbated by the amount of second hand racking on the market
following the closure of e-business related warehousing.  Costs have been
tightly controlled, with the closure of a production facility in California and
the consolidation of manufacturing into lower cost sites including a new
facility in Mexico.

Economic conditions have also adversely affected operations in our other
regional businesses, Eurotainer and TCR.  Despite this, both continued to
perform steadily and TCR benefited from new airport equipment pooling contracts
in the UK.  The results of Meineke and Brambles Marine are included in divested
businesses in the financial statements.



Looking forward to the next twelve months, economic recovery remains tentative
in the US and Europe.

In CHEP, we continue to see revenue growth opportunities in all of our markets.
Within the Americas segment, initiatives in the US to optimise the operation of
the new service centre network will increase costs in the short term and this
will result in weaker performance in the first half compared to the prior year
but with a stronger cash flow.  Trading in the second half should be better than
the comparable period last year.  In Europe, trading should improve as the year
progresses as benefits are realised from the restructuring programme.  Overall,
CHEP is expected to make good progress for the year as a whole.

Cleanaway's margin will be affected by the one off event of DSD re-tendering.
However Cleanaway is strategically well positioned to meet this challenge and to
resume growth momentum thereafter.

Growth is anticipated from Recall and Brambles Industrial Services should
continue to perform steadily.

In summary, although trading for the first half in constant currency will be
weaker than last year we expect a better performance in the second half, leading
to improved cash flow and good progress for the year as a whole.


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

FR UAOOROURKRUR                                                                                                                                                                                                                                             

a d v e r t i s e m e n t