France and Belgium drive Lavendon growth in 2012
16 January 2012
Lavendon Group said a combination of volume and price increases in the UK and continental Europe had driven its 8% revenue growth for the year to 31 December, with France and Belgium in particular benefitting from extra fleet redeployed from its closed Spanish operation.
In its trading update for the full year period, Lavendon reported a "marked improvement" in profitability, margins and return on capital employed (ROCE) for the year.
The group said its UK business, which represents half of all revenues, saw continued improvements in the final quarter of the year, although France and Belgium saw the best final quarter growths in Europe, at 14% and 10%, respectively.
The Middle East business, up 5% for the year as a whole, saw the best final quarter year-on-year performance, up 17%. Although demand in the region remains unpredictable, Lavendon benefited from the recovery of the Abu Dhabi and Saudi Arabian markets, which continued to gain momentum.
German revenues grew by 7% for the year, and Lavendon said efforts to improve profitability were starting to have an impact and that further progress would be made this year.
The group reduced its net debt levels by £33 million during the year to £107 million, which Lavendon said reflected strong cash flows, modest investment and a favourable currency exchange movement of £2 million. It said investment this year will increase, but that it still expects to reduce borrowing levels during 2012.
Don Kenny, Lavendon's chief executive, said: "The Group made good progress in 2011 with all operations growing revenues and the actions taken to improve operational efficiency and capital deployment delivering the expected benefits.
"As a result, there has been a marked improvement in the Group's profitability, margins and ROCE for the year. In addition, the improved performance has facilitated a significant reduction in the Group's net debt levels and has positioned us well as we move into 2012. The Board believes the Group's results for 2011 will be in line with expectations."
