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Interim Management Statement

08 November 2012

Howden Joinery Group Plc ('the Group') is today publishing its Interim Management Statement covering the period from the end of the first half of the year (10th June 2012) to date.

The Board is pleased to report that the business has continued to perform well, particularly during the important October trading period (period 11).

Throughout the Group, we continue to benefit from the focus of our operations and our business model. Our trading performance so far this year remains on track for the year as a whole, with the two remaining periods together typically accounting for over 10% of annual revenues.

Trading

Whilst trading conditions have continued to be demanding since the end of the first half of the year, we have successfully managed the business to deal with these conditions, particularly in period 11. As expected, the rate of growth in revenue moderated, as the impact on this of last year's June price increase fell away.

The broad pattern of underlying trading seen in the first half of the year has been maintained. In the second half of the year to 27 October (periods 7 to 11), revenue from Howden Joinery UK depots was 2.2% higher than the corresponding periods last year (excluding period 7, which has been reported previously, revenue was 2.8% higher). This reflects the focus on price discipline and margin within the depots, which has delivered improved profitability.

In the first 11 periods (44 weeks) of 2012, ending 27th October, Howden Joinery UK depots' revenue was up 4.3%, rising 2.2% on a same depot basis.

Cash flow

The Group's cash flow in 2012 is now anticipated to be better than previously thought, with at least a positive inflow currently forecast. This is mainly due to the timing of expenditure.

Business developments

Since we released our 2012 Half Yearly Report in July, we have opened three new depots, resulting in eleven new depots in the UK so far this year and bringing the total to 520. We are on course to open 20 in the whole of 2012.

With the increasing demand for more complex functionality of all kitchens that we see, we continue to invest in our product offering, and have recently rolled-out two new kitchen ranges.

We are closing two small non-core support businesses. This will result in an exceptional charge in respect of discontinued operations in 2012 of around £3m, of which approximately half consists of non cash items.

There have been no other material changes to the financial position of the Group in the period save as a result of the usual impact of the level of trading and those other matters disclosed herein.


Note: The Group typically reports a 52-week financial year, with a 53-week year reported every five or six years. The 2012 financial year will include a 53rd week. The effect of this is to increase operating costs by approximately £6m, revenue remaining unchanged as our depots are closed between Christmas and New Year. The range of analyst expectations for profit before tax from continuing operations for 2012, based on a 53-week year, is believed to be £98m to £107m.

Next scheduled announcement

The Group will release its 2012 Preliminary Results on 28 February 2013.

 

Enquiries
Investors/analysts:
Gary Rawlinson +44 (0)207 535 1127
Head of Investor Relations +44 (0)7989 397527
Media:
Brunswick +44 (0)207 404 5959
Kate Holgate
Zoe Bird

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