/raid1/www/Hosts/bankrupt/TCREUR_Public/030812.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
E U R O P E
Tuesday, August 12, 2003, Vol. 4, No. 158
Headlines
F I N L A N D
DONE SOLUTIONS: First-half Report Forecasts Full-year Loss
F R A N C E
A NOVO BROADBAND: Gets Exclusivity Extension Through August 29
GENESYS CONFERENCING: Conference Call on Q2 Earnings Tomorrow
G E R M A N Y
ADCON TELEMETRY: Board Approves Convertible Bond Issue
BERTELSMANN AG: Close to Concluding Merger Talks With Warner
CDV SOFTWARE: Forecasts Negative Second Quarter Results
JIL SANDER: Difficult Market, Weak Currency to Hit Results
I R E L A N D
ELAN CORPORATION: Noteholders Extend Waiver on EPIL Compliance
ELAN CORPORATION: Loan Covenant Waivers Have No Ratings Effect
I T A L Y
CAPITALIA SPA: Denies Any Link to Cirio Group's Insolvency
CIRIO FINANZIARIA: Prodi Bis Procedure Commissioners Named
FINCONSUMO BANCA: Moody's Upgrades Financial Strength to C-
L U X E M B O U R G
MILLICOM INTERNATIONAL: Announces Closure of Bond Offering
N E T H E R L A N D S
FORTIS N.V.: Finalizes Sale of Theodoor Gilissen to KBL Group
KONINKLIJKE AHOLD: Banks Extend Deadline for Audited Results
KONINKLIJKE AHOLD: Sales During Second Quarter Declines 12.4%
KONINKLIJKE AHOLD: Long-term Ratings Still on Watch Negative
VERSATEL TELECOM: EUR120 Million Q2 Revenues Mark Turnaround
P O L A N D
NETIA HOLDINGS: Warrant Exercise Ups Share Capital to PLN344 Mln
PRZEMYSLOWO-HANDLOWY: Moody's Reviews Financial Strength Rating
TRANS UNIVERSAL: Q4 to Record First Positive Figures in Years
R U S S I A
BELOVO: To Close 70-year-old Zinc Factory Within Weeks
S W E D E N
SCANDINAVIAN AIRLINES: Passenger Traffic, Load Factor Slide
S W I T Z E R L A N D
SWISS INTERNATIONAL: Pilots Union, Management Settle Row
U N I T E D K I N G D O M
AMP LIMITED: Moody's Concludes Rating Review with Downgrades
AMP LIMITED: Australian Subsidiary Settles GIO Class Action
AMP LIMITED: Chief Executive Gives Update on Demerger Proposal
CORUS GROUP: New Senior Secured Bank Facility Rated Ba3
EURODIS ELECTRON: Issues New Shares to Repair Balance Sheet
EURODIS ELECTRON: Expects Market Share Boost After Refinancing
EURODIS ELECTRON: Reduces Monthly Operating Expenses Up to 30%
EURODIS ELECTRON: Plans Larger, Longer-term Refinancing
EURODIS ELECTRON: Intends to Appoint New Directors
EURODIS ELECTRON: To Dispose of Pioneer Shareholding
EURODIS ELECTRON: Directors to Subscribe for Additional Shares
EURODIS ELECTRON: Loss Before Tax Balloons to GBP39.4 Million
FOOTBALL CLUBS: Smaller Football Clubs Face Crisis, Survey Shows
HENDERSON ABSOLUTE: Board Favors Voluntary Liquidation
LONDON FORFAITING: Resurge Plc Mulls Share, Cash Offer for Firm
MALLETT PLC: Expects Woes to Drag on as Pre-tax Profit Drops 60%
REGUS PLC: Slump in Sales May Force Firm into Bankruptcy
TRINITY MIRROR: CEO Meets with Possible Bidder for Irish Titles
* Large Companies with Insolvent Balance Sheets
*********
=============
F I N L A N D
=============
DONE SOLUTIONS: First-half Report Forecasts Full-year Loss
----------------------------------------------------------
Done Solutions released this interim first-half results recently. The
highlights are:
(a) Consolidated net sales for the period came to EUR12.3
million (EUR18.4 million in H1/2002, comparable net sales
were EUR16.2 million inH1/2002)
(b) Consolidated operating loss amounted to EUR1.0 million (a
loss of EUR2.8 million), or -8.0% of net sales (-15.4%), and
net loss for the period totaled EUR1.3 million (a loss of
EUR5.1 million), or -10.3% of net sales (-27.6%).
(c) Earnings per share were -EUR0.026 (-EUR0.071), while equity
ratio stood at 33.0% (41.3%).
(d) Liquid assets were EUR1.1 million (EUR2.9 million).
(e) The company improved its profit performance during the
report period, although still showing a loss.
(f) Second-half net sales are expected to remain at the first-
half levels and operating results for the period are
expected to improve on the first-half figures. The company
will show an operating loss for 2003 as a whole. The company
is expected to show a positive cashflow during the second
half and a neutral cash flow during 2003.
NET SALES AND PROFITABILITY
MEUR Q1/2003 Q2/2003 Total
Net sales 6.3 6.0 12.3
Operating profit/loss -0.6 -0.4 -1.0
Profit/loss before extraordinary items -0.6 -0.5 -1.1
Net profit/loss for the period -0.7 -0.6 -1.3
Done Logistics
Within Systems & Software, second-quarter demand remained satisfactory for
management systems - especially Warehouse Management Systems for the Nordic
beverage industries - and maintenance work. With no clear signs of rebound
in sight, demand for materials handling systems remained weak. The business
area continued to take measures to streamline its operations and rein in
costs, as evidenced by the EUR0.2 million cost-savings achieved during the
second quarter through fixed-term layoffs, staff reductions and other
retrenchment. These cost-control measures will also be reflected in the
third and fourth quarter results. Thanks to new distribution agreements
concluded by the Distribution unit, volumes remained at satisfactory levels.
Done Information
Within Software & Services, second-quarter demand for multilingual
documentation services remained at a satisfactory level. Translation and
localization services experienced a favorable volume development as planned,
improving its profit performance over the first quarter, whereas demand
remained low for software solutions.
Despite the persistently mild demand, the Engineering unit succeeded in
enhancing its invoicing volumes during the second quarter, especially for
product development projects, although the unit showed a market loss for the
report period. The unit intensified its selling efforts, with a view to
raising its volumes during the second half.
Done Information and Done Logistics net sales and profitability are
summarized:
Net Sales Net Sales Operating Profit/Loss
H1/2003 H1/2002 H1/2003 H1/2002
MEURShare MEURShare MEUR % MEUR %
Done Logistics
Systems&Software 3.3 27% 6.9 38% -0.6 -21% -1.2 -18%
Distribution 4.9 40% 5.5 30% -0.0 0% -0.6 -10%
Total 8.2 67% 12.4 67% -0.7 -8% -1.8 -14%
Done Information
Software&Services 3.3 26% 4.1 22% 0.0 1% -0,1 -1%
Engineering 0.8 7% 1.9 10% -0.3 -42% -1.0 -53%
Total 4.1 33% 6.0 33% -0.3 -8% -1.1 -18%
Done Solutions 12.3 100% 18.4 100% -1.0 -8% -2.8 -15%
While year-on-year net sales fell across the board, operating results
improved within all units.
Net sales Net sales Net sales
Q1/2003 Q2/2003 Total
MEURShare MEURShare MEURShare
Done Logistics
Systems&Software 2.0 32% 1.3 22% 3.3 27%
Distribution 2.1 34% 2.8 47% 4.9 40%
Total 4.1 66% 4.1 68% 8.2 67%
Done Information
Software&Services 1.7 27% 1.6 26% 3.3 26%
Engineering 0.5 8% 0.3 6% 0.8 7%
Total 2.2 34% 1.9 32% 4.1 33%
Done Solutions 6.3 100% 6.0 100% 12.3 100%
Op.profit/loss Op.profit/loss 0p.profit/loss
Q1/2003 Q2/2003 Total
MEUR % MEUR % MEUR%
Done Logistics
Systems&Software -0.3 -16% -0.3 -27% -0.6 -21%
Distribution -0.0 -2% 0.0 2% -0.0 0%
Total -0.4 -9% -0.3 -7% -0.7 -8%
Done Information
Software&Services -0.0 -2% 0.1 4% 0.0 1%
Engineering -0.2 -35% -0.2 -50% -0.3 -42%
Total -0.2 -9% -0.1 -6% -0.3 -8%
Done Solutions -0.6 -9% -0.4 -7% -1.0 -8%
The comparable figures for 2002 include Done Logistics Ab (Done
Solutions' Swedish subsidiary) and its subsidiary, Actipac Ab, both declared
bankrupt in April 2002, until March 31, 2002. Their combined net sales for
January-March 2002 totaled EUR2.2 million (Done Logistics Systems & Software
accounting for EUR1.8 million Distribution for EUR0.4 million), while their
operating loss amounted to EUR0.4 million (Systems & Software
-EUR0.4 million and Distribution EUR0.0 million).
Taxes for the period include EUR0.2 million write-downs of avoir fiscal
receivables.
FINANCIAL POSITION
Period-end consolidated balance sheet total amounted to EUR9.3 million
(EUR17.1 million on June 30, 2002) while shareholders' equity came to EUR3.0
million (EUR6.9 million). At period-end, equity ratio was 33.0% (41.3%),
gearing stood at 4.2% (5.4%) and interest-bearing liabilities EUR1.2 million
(EUR3.2 million).
Earnings per share came to EUR-0.026 (EUR-0.071). Equity per share was
EUR0.061 (EUR0.139). Liquid assets totaled EUR1.1 million (EUR 2.9 million)
at the end of the period.
The Group forecasts that its cashflow from business operations will be
positive over the next twelve months. The company estimates that its liquid
assets will suffice during the next 12-month period.
INVESTMENTS AND PRODUCT DEVELOPMENT
The company did not make any major investments or divestments during the
report period.
Product development costs for the period came to EUR0.1 million, or 0.8% of
net sales.
HUMAN RESOURCES
At the end of the period, the Group had a total staff of 238 (employees on
the payroll 205). On June 30, 2003, Done Logistics' Systems & Software unit
had a staff of 78, Distribution 20, Done Information's Software & Services
94 and Engineering 46. A year ago, the Group's staff numbered 258.
In addition, Ametro Oy, a staffing service provider in which Done Solutions
has a 30% holding, had a staff of 142 at the end of the report period.
SHARE CAPITAL, SHARES AND SHAREHOLDERS
On June 30, 2003 Done Solutions had a share capital of EUR7,420,122.60 and
the number of shares totaled 49,467,484.
The company's largest shareholders are listed on Done's website at
http://www.donesolutions.com(Investors/Financial Information/Largest
shareholders).
The highest share quotation for the period was EUR0.20 and the lowest
EUR0.10. With an average price of EUR0.14, the company's share closed at
EUR0.13 on June 30, 2003. The reported value of share turnover was EUR0.3
million, or 2,194,206 shares, and the company's market capitalization on
June 30, 2003 was EUR6.4 million.
The unexercised share-issue authorization given by the Annual General
Meeting of March 21, 2003 to the Board of Directors applies to 9,893,496
shares on June 30, 2003. As of the same date, the company held no treasury
shares.
MAJOR EVENTS DURING THE PERIOD
Please refer to the NET SALES AND PROFITABILITY section for information on
major events during the report period. The period was still characterized
by difficult market conditions, and the company continued its streamlining
and restructuring program, with the aim of matching the current business
volume.
MAJOR EVENTS AFTER THE PERIOD
Veijo Pekkala, Group Management Team member and Done Logistics Sales
Director and Director responsible for the development of subcontracting and
partner networks, is no longer employed by the company.
FUTURE PROSPECTS
The market situation is likely to continue to remain difficult during the
second half of 2003. The launch of Done Logistics' customer investments
still seems unpredictable. Also, there are no marked signs of upturn in
demand for Done Information services either, although there is potential for
customers' outsourcing their services, which may stimulate demand.
Second-half net sales are expected to remain at the first-half levels and
operating results for the period are expected to improve on the first-half
figures. The company will show an operating loss for 2003 as a whole. The
company is expected to show a positive cashflow during the second half and a
neutral cash flow during 2003. Measures to trim costs will also continue
during the rest of the year.
Done Solutions Corporation
Board of Directors
Done Solutions shares have been quoted on the Helsinki Exchanges' NM list
since 2001, and the company is organized into two business areas: Done
Logistics provides comprehensive logistics systems, based on the automation
of materials handling, the supporting information systems and outsourcing
services. Done Information provides information solutions, from design and
documentation to after-sales marketing. Done
Solutions operates in selected industries in the Nordic countries, Central
Europe and the United States, and its customers typically represent leading
international companies in their industries.
To See Financial Statements:
http://bankrupt.com/misc/Done_Solutions_Results.htm
CONTACT: DONE SOLUTIONS CORPORATION
Kari Akman, President and Chief Executive Offiver
Phone: + 358 (0)205 253427
Mobile: 040 586 5927
E-mail: kari.akman@donesolutions.com
Mika Soyring, Controller
Phone: + 358 (0)205 253425
Mobile: 040 777 0033,
E-mail: mika.soyring@donesolutions.com
Home Page: http://www.donesolutions.com
===========
F R A N C E
===========
A NOVO BROADBAND: Gets Exclusivity Extension Through August 29
--------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of Delaware, A Novo
Broadband, Inc., obtained an extension of its exclusive periods. The Court
gives the Debtor until August 29, 2003 the exclusive right to file their
plan of reorganization and until November 28, 2003 to solicit acceptances of
that Plan.
A Novo Broadband, Inc., a business engaged primarily in the repair and
servicing of broadband equipment for equipment manufacturers and operators
of cable and other broadband systems in North America, filed for chapter 11
petition on December 18, 2002 (Bankr. Del. Case No. 02-13708). Brendan
Linehan Shannon, Esq., M. Blake Cleary, Esq., at Young, Conaway, Stargatt &
Taylor represent the Debtor in its restructuring efforts. When the Company
filed for protection from its creditors, it listed $12,356,533 in total
assets and $10,577,977 in total debts.
*****
A Novo Broadband, Inc. is part of the Paris based A Novo Group
(http://www.a-novo.com),which services broadband, electronic, and
telecommunication equipment on an industrial scale within Europe, North
America, & South America.
GENESYS CONFERENCING: Conference Call on Q2 Earnings Tomorrow
-------------------------------------------------------------
Genesys Conferencing (Euronext: 3955) (Nasdaq: GNSY), the world's leading
conferencing specialist, will hold a conference call on Wednesday, August
13, 2003, at 5:30 p.m. Central European Time or 11:30 a.m. Eastern Daylight
Time regarding second quarter 2003 earnings.
Chairman and Chief Executive Officer Francois Legros and Executive Vice
President/Chief Financial Officer Michael E. Savage will host the call. It
will be Webcast live, and may be accessed by joining the live Webcast at
http://www.genesys.com
If you are unable to participate during the conference, a replay of the call
will be available at http://www.genesys.com
About Genesys Conferencing
Genesys Conferencing is a global leader in integrated multimedia solutions,
providing a full range of practical and innovative real-time collaboration
and conferencing services to over 18,000 clients worldwide. The largest
conferencing specialist in the world, with an unmatched global presence,
Genesys Conferencing has established its integrated multimedia technology in
20 countries throughout Europe, Asia Pacific and North America. Genesys
Conferencing is listed on the Nouveau Marche in Paris (Euronext: 3955) and
Nasdaq (GNSY). Additional information is available at www.genesys.com
*****
Genesys agreed with its main bank creditors and shareholders in April to
amend Genesys' US$125 million credit facility agreement of April 20, 2001, t
o extend the repayments of the principal remaining due ($118 million)
through 2008. It also obtained agreement to defer 50% of the principal
payment maturity of its outstanding 3% convertible bonds issued in 1999 to
October 2005.
CONTACT: GENESYS CONFERENCING
Michael E. Savage
Executive Vice President/Chief Financial Officer
Direct Line: +33 4 99 13 27 66
E-mail: mike.savage@genesys.com
Marine Pouvreau
Investor Relations
Phone: +33 4 99 13 25 17
E-mail: marine.pouvreau@genesys.com
=============
G E R M A N Y
=============
ADCON TELEMETRY: Board Approves Convertible Bond Issue
------------------------------------------------------
The capital measures have been approved by [Fri]day's general meeting. As a
first step of realization this capital measures the Executive Board has
decided, based on the authorization of the Board and approval of the
Supervisory Board, to issue a convertible bond with a nominal of up to EUR2
million. As a bridge financing these funds will secure Add-on's liquidity
and further finance the group's recapitalization measures.
This convertible bond will be issued as private placement without
subscription rights for shareholders and fully subscribed by institutional
investors.
Changes in the Supervisory Board A new constitution of the Supervisory Board
has been decided in the course of [Fri]day's ordinary shareholder meeting.
Former chairman of the Supervisory Board, Mr. Alexander Pachta-Reyhofen,
deputy chairman Mr. Christian Kleinferchner as well as member of the
Supervisory Board, Mr. Jakob Falkner have decided to resign from the Adcon
Supervisory Board. Besides Mr. Martin Hellweger, who will continue to be on
the Supervisory Board the following persons have been appointed into the
Supervisory Board at today's general meeting: Mr. Norbert Frommer, Ms.
Susanne Niedhof, Mr. Klaus-Ernst Perfall as well as Mr. Jurgen Kohlhaas.
In its constituent meeting on August 7, 2003 the Supervisory board has
elected Mr. Norbert Frommer as new chairman of the Supervisory Board as well
as Mr. Martin Hellweger as new deputy chairman.
CONTACT: ADCON TELEMETRY
DI Felix Primetzhofer
Phone: 0043 (0)2243 38280-0
E-mail: investor-relations@adcon.at
Home Page: http://www.adcon.com
BERTELSMANN AG: Close to Concluding Merger Talks With Warner
------------------------------------------------------------
Recording industry giants AOL Time Warner and Bertelsmann BMG are near a
merger deal, AFX News said, citing Der Spiegel news magazine.
The report said talks are now at a make-or-break stage, with the due
diligence and a decision on whether to go ahead or not are expected to be
made by the end of August. The companies have been jockeying for a takeover
bid since they signed an exclusivity agreement, preventing other parties to
join the talks, in June. This agreement expired on July 30 but was extended
until August 30, the report said.
The major issue currently under discussions pertains to the future ownership
of the combined entity. BMG is said to be favorable to a 50:50 joint
venture, while Warner wants to dominate the partnership with a 60% control.
There were reports that the two companies have already informally sounded
out the E.U. Commission about possible blockage to the tie up, but people
interviewed by the magazine denied such move.
CDV SOFTWARE: Forecasts Negative Second Quarter Results
-------------------------------------------------------
CDV Software Entertainment AG, publisher of computer games and application
software, announced today its outlook on the figures for the second quarter
of the current year and announced rigorous restructuring measures.
Net sales from April to June at approximately EUR4 million are expected to
be approximately at the level of the previous year.
The second quarter of the previous year closed with a moderate loss of
approximately -EUR1 million (total year 2002: -EUR185,000). In the current
quarter, a considerably higher loss of approximately -EUR4 million before
taxes is expected.
Targeted sales growth for the second quarter was not realized due to several
shifts in release dates and below-schedule sales. Personnel levels, which
were built up in expectation of much higher growth, will be adjusted to the
new situation at short notice. The restructuring measures impact all areas
of the company and will be realized by allowing limited work contracts to
expire and also by operation-related notices of termination.
With sales lagging behind expectations, a value adjustment of EUR 930,000
was taken on the Heaven & Hell game in the last quarter. As the prospects
for the success of the Galaxy Andromeda project are also not considered to
be very high, the project will be ended and a value adjustment made.
Despite the very promising product pipeline for the 2nd half of this year,
the Management Board no longer expects a positive result for the whole of
the financial year.
JIL SANDER: Difficult Market, Weak Currency to Hit Results
----------------------------------------------------------
JIL SANDER Group's sales in the first six months from January to June 2003
decreased, compared to the prior-year six-month period, by 7.1% from EUR68.0
million to EUR63.2 million. In the first half of 2003 the Group has
incurred a loss of EUR14.3 million. In the first half of 2002 JIL SANDER
Group had made a loss of EUR13.6 million. The result has been positively
influenced by a profit of EUR6.4 million from the sale of real estate.
Revenues reflect the unfavorable international economic situation, which has
particularly affected the luxury industry in the first half of the year.
This together with a negative exchange rate effect due to a weak Dollar and
Yen do not permit yet to generate contribution margins that may be
sufficient to recover the costs arising from the recent high investments in
the JIL SANDER Retail distribution.
The management board expects to achieve a significant turnaround of sales
and revenues in the medium term as a consequence of the return of Jil Sander
in JIL SANDER AG, which will improve and accelerate the development of the
company.
=============
I R E L A N D
=============
ELAN CORPORATION: Noteholders Extend Waiver on EPIL Compliance
--------------------------------------------------------------
Elan Corporation, plc (NYSE: ELN) announced that it has sought and received
additional agreements from a majority of the holders of the guaranteed notes
issued by Elan's qualifying special purpose entities, Elan Pharmaceutical
Investments II, Ltd. and Elan Pharmaceutical Investments III, Ltd. The
agreements extend to August 15, 2003, the EPIL II and EPIL III noteholders'
waivers of compliance by Elan with certain provisions of the documents
governing the EPIL II and EPIL III notes that required Elan to provide the
noteholders with Elan's 2002 audited consolidated financial statements by
July 29, 2003. The waivers expired Friday last week. Elan did not pay a
fee in connection with the additional waivers.
As previously announced, Elan is devoting all necessary resources to
completing and filing its 2002 Annual Report on Form 20-F as expeditiously
as possible. However, Elan cannot provide any assurances as to the timing
of the filing of the 2002 Form 20-F.
Elan is focused on the discovery, development, manufacturing, sale and
marketing of novel therapeutic products in neurology, pain management and
autoimmune diseases. Elan shares trade on the New York, London and Dublin
Stock Exchanges.
ELAN CORPORATION: Loan Covenant Waivers Have No Ratings Effect
--------------------------------------------------------------
Standard & Poor's Ratings Services said that the ratings and outlook on Elan
Corporation PLC (CCC/Watch Neg/--) would not be affected after the company
received an extension of loan covenant waivers from debtholders in
subsidiaries Elan Pharmaceutical Investments II (EPIL II) and EPIL III. The
extension, however, is a positive development, that gives Dublin,
Ireland-based specialty pharmaceutical company Elan until Aug. 15, 2003, to
file its 2002 Form 20-F with the SEC. The ratings were lowered and placed
on CreditWatch with negative implications on June 26, 2003, after the
company failed to file its Form 20-F 2002 Annual Report. The failure put
Elan into technical default of its EPIL II, EPIL III, and Athena
Neuroscience debt.
If not cured, this could still result in an acceleration of Elan's debt
obligations. The company currently does not have the liquidity to satisfy
all of its outstanding debt in the event of acceleration. The subordinated
EPIL debt matures in 2004 and 2005, and the senior unsecured Athena debt
matures in 2008. Standard & Poor's expects that Elan will continue to
receive waivers from EPIL holders. However, if the default is not cured by
Sept. 14, 2003, the Athena Neuroscience debtholders can trigger an
acceleration.
=========
I T A L Y
=========
CAPITALIA SPA: Denies Any Link to Cirio Group's Insolvency
----------------------------------------------------------
Banca di Roma S.p.A. has been informed by ANSA that the Rome Bankruptcy
Court (Chairman. Mr. Anacleto Grimaldi, Judge Mr. Vincenzo Vitalone) passed
a sentence declaring the insolvency of companies Cirio Del Monte S.p.A.,
Cirio Holding S.p.A. and Cirio Finanziaria S.p.A., and subjecting the
aforesaid companies to the extraordinary administration procedure.
In the context of the above measures, and in evaluating the
non-compatibility and potential conflict of interest regarding Mr. Emmanuele
Emanuele through his current office as Chairman of the
Fondazione Cassa di Risparmio di Roma which holds shares in Banca di Roma,
the sentence stated: "A Bank which is a huge creditor of the Cirio Group and
which has played a leading role in operations linked to the issue of bonds
which the plaintiff companies pointed to as a cause very closely tied to the
group's insolvency."
As this information, from whatever source the court had obtained it,
apparently without checking it, is wholly unfounded -- both as regards
linking the group's insolvency to operations connected to the issue of
bonds, and as concerns the allegedly leading role of the Banca di Roma in
connection with these correlated operations -- Capitalia declares that it
has instructed its attorneys to protect the good name and reputation of the
Capitalia Group in all competent venues, against such information,
sufficient to cause serious prejudice and discredit.
It is puzzling that the Court has made use of unconfirmed and clearly
unfounded information, which is also irrelevant with respect to the contents
of the sentence.
CIRIO FINANZIARIA: Prodi Bis Procedure Commissioners Named
----------------------------------------------------------
A bankruptcy court in Rome appointed three commissioners for Italian canned
goods maker, Cirio Finanziara, after declaring the company insolvent.
Attilio Zimatore, Emmanuele Emanuele and Mario Resca were nominated
commissioners for the Prodi bis procedures of Cirio Del Monte, Cirio Italia
spa, Cirio Finanziaria and Cirio Holding, Industry Minister Antonio Marzano
said, according to Agenzia Geornalistica Italia. The commissioners will
determine whether Cirio should also be given temporary protection from its
creditors. Their report will then be used to decide whether Cirio and its
Cirio Del Monte Italia division should be placed in extraordinary
administration.
An administration could give Cirio up to two years to turn the company
around, or face a split up. The government, though, is expected to help
Cirio escape the possibility of going under, according to the report. The
country's four principal banks -- Banca Intesa, UniCredito, Sanpaolo IMI and
Capitalia -- are also believed to be ready to offer their support.
The company was unable to repay ungraded bonds totaling EUR1.1 billion in
November. It was put into liquidation after failing to convince bondholders
to accept a recovery plan put forward by the group's advisors.
FINCONSUMO BANCA: Moody's Upgrades Financial Strength to C-
-----------------------------------------------------------
Moody's Investors Service upgraded the financial strength rating of
Finconsumo Banca, Italy's seventh largest consumer finance company, to C-
from D+, reflecting the bank's improved financial performance over recent
years.
The outlook of the financial strength rating was brought in line with the
stable outlook of the bank's A2 long-term and Prime-1 short-term deposit
ratings. The ratings were affirmed by virtue of Finconsumo's key role and
expected strong integration within the consumer finance business of the
Santander Central Hispano group.
Moody's recognizes Finconsumo's ability to improve its profitability against
a background of continuing contraction of interest spreads on consumer
finance products. It also noted the bank's ability to maintain a stable
market share in the rapidly growing consumer finance sector.
Finconsumo had total assets of EUR1.26 billion at end-2002.
===================
L U X E M B O U R G
===================
MILLICOM INTERNATIONAL: Announces Closure of Bond Offering
----------------------------------------------------------
Millicom International Cellular S.A. (Nasdaq: MICC), the global
telecommunications investor, announces that on August 7, 2003 the offering
by its subsidiary Millicom Telecommunications S.A. of approximately SEK2,556
million (US$310 million) of secured Notes mandatorily exchangeable into
Series B shares of Tele2 AB, has closed. The Notes, which will mature in
August 2006, carry a coupon of 5% per annum and the exchange premium has
been set at 30% with a reference price of SEK 285.
=====================
N E T H E R L A N D S
=====================
FORTIS N.V.: Finalizes Sale of Theodoor Gilissen to KBL Group
-------------------------------------------------------------
As announced on June 20, Fortis has finalized the sale of its subsidiary
Theodoor Gilissen to KBL Group European Private Bankers, for the cash sum of
EUR170 million.
Fortis is confident that, by joining the international private banking
network of KBL Group European Private Bankers, Theodoor Gilissen will be
able to realize its full potential by taking advantage of new growth
opportunities in a changing environment.
The deal has yet to be approved by the regulatory authorities in the
countries involved.
*****
Fortis said persistently weak economic conditions and depressed
stock markets pushed down its net operating profit, excluding the unrealized
value adjustment of the equity portfolio, to EUR 763 million, an 8% decrease
compared with the first quarter of 2002, Fortis' best quarter ever.
Fortis booked a net loss of EUR 453 million in the first quarter, including
the unrealized value adjustment of the equity portfolio of EUR 1.2 billion
(EUR 0.9 million at 21 May).
CONTACT: FORTIS N.V.
Rue Royale 20
1000 Brussels
Belgium
Archimedeslaan 6
3584 BA Utrecht
The Netherlands
Home Page: http://www.fortis.com
Investor Relations
Brussels
Phone: 32 (0) 2 510 53 37
Utrecht
Phone: 31 (0) 30 257 65 46
KONINKLIJKE AHOLD: Banks Extend Deadline for Audited Results
------------------------------------------------------------
Ahold announced that it has reached an agreement with its syndicate of banks
to extend the deadline for the delivery of audited consolidated fiscal year
2002 financial statements to September 30, 2003. After the completion of
all internal forensic accounting investigations, as announced on July 1,
2003, Ahold is determining and processing the accounting adjustments
required as a result of these investigations and as a result of the audit.
In consultation with its auditors, Deloitte & Touche, Ahold has concluded
that this process is taking longer than expected.
The delay in completion of the audited consolidated fiscal year 2002
financial statements will further delay the publication of its Annual Report
and the filing of its Annual Report on
Form 20-F for fiscal year 2002. Ahold will publish and file the Annual
Report as soon as possible after completion of the audited consolidated
financial statements.
Under its EUR2.65 billion credit facility negotiated in March 2003, Ahold
was required to deliver its audited consolidated fiscal year 2002 financial
statements by August 15, 2003 to the syndicate of banks involved. Delivery
by August 15, 2003 was a condition for the availability of the unsecured
tranche of US$915 million and for the continuing availability of the secured
tranche, which totals US$1.285 billion and EUR600 million. That deadline
has now been extended to September 30, 2003.
The company does not foresee the need for drawing on the US$915 million
unsecured tranche based on its current cashflow projections. This reflects
Ahold's confidence in its ability to meet its obligations in 2003, including
the cash payment in full of Ahold's outstanding EUR678 million convertible
subordinated notes that mature on September 30, 2003.
The currently remaining US$270 million capacity under the US$450 million
back-up facility, also announced in March, remains available to Ahold as
necessary for further support of the U.S. Foodservice securitization
programs.
CONTACT: KONINKLIJKE AHOLD
Corporate Communications
Phone: +31.75.659.57.20
KONINKLIJKE AHOLD: Sales During Second Quarter Declines 12.4%
-------------------------------------------------------------
Koninklijke Ahold released this second-quarter sales figures recently. The
highlights are:
(a) Consolidated 2Q 2003 sales amounted to EUR13.0 billion, a
decline of 12.4% compared to the same period last year
(b) Sales are significantly impacted by lower currency exchange
rates; sales excluding currency impact increased by 2.5%
(c) Organic sales growth, excluding currency impact, amounted to
1.3%
Ahold announced consolidated sales (excluding VAT) for the second quarter of
the year (12 weeks through July 12, 2003) of EUR13.0 billion, a decline of
12.4% compared to the EUR14.8 billion generated in the 2002 second-quarter
(12 weeks). In a difficult trading environment, sales excluding currency
impact increased by 2.5% and organic sales growth excluding currency impact
amounted to 1.3%. All numbers exclude sales of joint ventures and are
unaudited.
Ahold USA - retail
In the United States, retail sales increased by 1.1% to US$6.2 billion
(2002: US$6.2 billion). Organic sales growth also amounted to 1.1%.
Comparable sales declined by 1.1% and identical sales declined by 1.9%.
Ahold USA - Foodservice
Foodservice sales in the United States increased by 0.2% to US$ 4.1 billion
(2002: US$4.1 billion). Organic sales growth also amounted to 0.2%.
Europe
In Europe (The Netherlands, Spain and Central Europe), sales rose 0.6% to
EUR3.3 billion (2002: EUR3.2 billion). Organic sales growth, excluding
currency impact, amounted to 0.9%.
South America
In South America (Brazil, Argentina, Chile, Peru and Paraguay), sales
amounted to EUR608.7 million (2002: EUR503.8 million), up 20.8% from last
year partly due to the fact that Santa Isabel was not consolidated in the
second quarter of 2002. Organic sales growth, excluding currency impact,
amounted to 11.4%.
Asia
In Asia (Thailand, Malaysia, Indonesia), sales declined 15.2% to EUR92.9
million (2002: EUR109.6 million). Organic sales growth, excluding currency
impact, amounted to 2.5%.
Accounting for joint ventures
As Ahold announced on May 16, 2003, all current and previous joint ventures
are being accounted for using equity accounting. As a consequence, the
income from these joint ventures will be accounted for as income from
unconsolidated subsidiaries. Previously, these joint ventures were fully
consolidated in Ahold's financial statements with the minority share in
earnings and equity then deducted.
This change applies to ICA Ahold in Scandinavia and Jeronimo Martins Retail
in Portugal for 2003 and 2002 and for Disco in Argentina up to and including
the first quarter of 2002 and for Santa Isabel in Chile, Peru and Paraguay
up to and including the first and second quarter of 2002.
Historical financial statements have also been restated to reflect this
change for the above-mentioned joint ventures, as well as for Bompreco in
Brazil (up to and including the second quarter of 2000) and Paiz Ahold in
Central America.
Set forth below are the sales figures for fiscal years 2002 and 2001
restated to account for Ahold's joint ventures on an equity basis. These
figures are unaudited.
Definitions
Organic sales development:
[Sales year n] divided by [Sales year (n-1)(i) Ahold base + sales year
(n-1)(i) of acquired companies(ii)]
(i) Adjusted for currency impact.
(ii) Applies to acquisitions dating back less than one year and to the
extent that the sales of the acquired company represent > 5% of the sales of
the acquiring entity, or that the acquisition is an entry into a new
business channel or market area.
Identical sales compare sales from exactly the same stores.
Comparable sales are identical sales plus sales from replacement stores.
Currency impact: the impact of using different exchange rates to translate
the financial figures of our subsidiaries to Euros. The financial figures
of the previous year are restated using the actual exchange rates in order
to eliminate this currency impact.
To view full results and tables:
http://bankrupt.com/misc/Ahold_2nd_quarter_sales.pdf
CONTACT: KONINKLIJKE AHOLD
Corporate Communications
Phone: +31 75 659 5720
KONINKLIJKE AHOLD: Long-term Ratings Still on Watch Negative
------------------------------------------------------------
Standard & Poor's Ratings Services said it maintained its long-term credit
ratings on Netherlands-based food retailer and food-service distributor
Ahold Koninklijke N.V. on CreditWatch with negative implications--including
its 'BB-' long-term corporate credit and 'B+' senior unsecured debt
ratings -- following the group's announcement that once again it needs
additional time to provide the necessary audited consolidated accounts
required under its main bank facility.
Delivery of the audited accounts by Aug. 15, 2003, was a condition for the
availability of the unsecured tranche of $915 million, and for the
continuing availability of the secured tranche, which totals $1.3 billion
and EUR600 million. The group has obtained a waiver from banks, and the
deadline has been extended to Sept. 30, 2003.
"Despite the company stating that it does not foresee the need to draw on
the unsecured tranche based on its current cash flow projections, Standard &
Poor's remains concerned about the complexity and lack of visibility of the
auditing process, and its impact on the group's ability to meet the new
deadline," said Standard & Poor's credit analyst Christian Wenk.
"Liquidity could come under further pressure if audited accounts are not
provided within the next four months as Ahold will need to fund its
increased seasonal working capital needs at that time."
Nevertheless, in the interim, Standard & Poor's estimates that Ahold would
maintain sufficient liquidity to meets its EUR680 million convertible bond
debt maturity arising on Sept. 30, 2003, even though it might be unable to
gain access to the $915 million unsecured tranche by then. The liquidity
arises from a combination of factors, such as improvements to the group's
working capital management, reduced capital expenditures, operating
performance, and disposals. However, despite these short-term boosts to
Ahold's free cash flow, overall liquidity could remain very tight,
particularly if the group fails to access the unsecured tranche before its
anticipated increase in working capital needs.
Although the next major review of the CreditWatch status is expected near
the Sept. 30, 2003 deadline, Standard & Poor's will continue close ongoing
monitoring of Ahold's liquidity situation.
VERSATEL TELECOM: EUR120 Million Q2 Revenues Mark Turnaround
------------------------------------------------------------
Revenues for 2Q03 were EUR120.0 million (EUR118.5 million on a recurring
basis excluding the recognition of EUR1.5 million of previously unearned
revenue in Germany related to past interconnection charges) compared to
revenues of EUR87.1 million in 1Q03 and revenues of EUR70.4 million in 2Q02.
On-net revenues for 2Q03 were EUR86.2 million compared to EUR63.4 million in
1Q03 and EUR47.0 million in 2Q02. On-net customer additions and the success
of Versatel's consumer operations in Germany and The Netherlands primarily
drove this growth as
we continued to leverage our initial investments in both fiber- and
copper-based technologies.
Versatel's gross margin as a percentage of revenues in 2Q03 was 54.1% (51.6%
on a recurring basis excluding EUR1.5 million of unearned revenue released
in Germany and a EUR2.3 million release of prior period network costs in The
Netherlands) compared to 52.5% in 1Q03 and 50.8% in 2Q02. The decrease in
recurring gross margin as a percentage of revenue was due to the
consolidation of the newly acquired German companies.
Raj Raithatha, Chief Executive Officer of Versatel, commented:
"Q2 was another strong performing quarter for Versatel. Excluding the
impact of our recent acquisitions, top line organic growth was in-line with
our midsingle digit sequential growth expectations. This growth is
primarily a reflection of the strong performance in both The Netherlands and
Germany of our on-net product offering as we continue to win business in the
corporate data market and increase our market share in the consumer
broadband segment."
Selling, general and administrative expenses (SG&A) for 2Q03 was EUR42.7
million (EUR43.4 million on a recurring basis excluding a EUR0.7 million
release of over accruals) compared to EUR32.6 million in 1Q03 and EUR33.9
million in 2Q02. Marketing expenditures were EUR2.0 million for 2Q03
compared to EUR2.2 million in 1Q03 and EUR2.6 million in 2Q02. The increase
in SG&A is primarily related to the consolidation of tesion and Completel
Germany (newly renamed Versatel Germany) and an increase in customer related
expenses due to installing more broadband customers on our network.
For the quarter ended June 30, 2003, Versatel's adjusted earnings before
interest, tax, depreciation and amortization, restructuring charges, release
of accruals and claim settlements (adjusted EBITDA) was positive EUR17.7
million compared to positive EUR13.1 million in 1Q03 and positive EUR1.9
million in 2Q02.
During the quarter Versatel recognized a EUR5.7 million restructuring charge
related to the integration of tesion and Completel Germany (newly named
Versatel Germany). In conjunction with this charge, over the next 18-24
months we expect to generate EUR7-10 million of annual savings from the
integration of the German businesses.
For the quarter ended June 30, 2003, Versatel's result before interest, tax,
depreciation and amortization (EBITDA) was positive EUR16.6 million compared
to positive EUR28.1 million (including a EUR14.9 million one time settlement
with Deutsche Telekom) in 1Q03 and positive EUR3.0 million in 2Q02. This
sequential decline was primarily related to the EUR5.7 million restructuring
charge in 2Q03 and the one-time EUR14.9 million gain in 1Q03 related to the
settlement with Deutsche Telekom.
Mark Lazar, Chief Financial Officer, commented: "We are pleased with our
quarter over quarter recurring EBITDA improvement of approximately EUR5.0
million. Customer growth continues to be strong and we remain committed to
customer profitability and reasonable payback requirements, which has
allowed us to continue to expand our margins. Although we are still
experiencing pricing pressure in the data market and have a lot of work
ahead of us to grow the organic business and integrate our German
acquisition, we still believe that we will achieve recurring free cash flow
profitability in the first quarter of next year."
As of 1Q03, Versatel had a deferred tax liability of EUR129.6 million on its
balance sheet in respect of the gain related to the financial restructuring,
whereby any subsequent losses in The Netherlands are recognized and taken
against this deferred tax liability. As a result, Versatel recognized an
income tax credit of EUR5.4 million related to the net operating losses in
its Dutch operations during the second quarter of 2003, which reduced this
liability to EUR124.2 million at the end of 2Q03. In addition, as part of
the purchase price allocation process, Versatel is currently assessing
whether or not it will recognize a deferred tax liability related to
inter-company loans that were assumed as part of the German acquisition.
Although this potential liability would only result in a cash outflow if
Versatel were to waive the inter-company loan or upon future repayment, if
any, for prudent accounting purposes, it may still be necessary to recognize
a deferred tax liability in Germany of approximately EUR20-40 million.
Versatel will finalize its investigation of this issue in 2003, but it will
have no impact on Versatel cashflow or funding expectations.
Versatel recognized a net loss in 2Q03 of EUR11.5 million compared to a
profit of EUR1.0 million in 1Q03 and a loss of EUR252.5 million in 2Q02.
Versatel's net loss in 2Q03 was favorably impacted by a EUR2.5 million gain
related to the pro-rata attribution of Versatel Deutschland Holding's losses
to Arques due to its 15% minority interest stake in Versatel Deutschland
Holding's.
Versatel's capital expenditures for 2Q03 were EUR20.7 million. The capital
expenditures for the quarter were primarily related to new customer
additions and the ongoing integration of the German acquisitions. In total,
Versatel's free cash inflows for 2Q03 were EUR1.6 million compared to cash
outflows of EUR39.1 million in 1Q03 and a cash outflow of EUR108.4 million
in 2Q02. As of June 30, 2003, Versatel had EUR153.6 million in cash, cash
equivalents and marketable securities on its balance sheet. Versatel
believes that its organic business plan is fully funded without a need for
third party financing. Given its significant cash balance and funding
position, Versatel believes it has cash over-funding that will allow it to
explore potential growth opportunities through the acquisition of customer
bases, distressed assets or going concerns in its core markets of The
Netherlands, Belgium and Germany.
Financial results (excluding the acquisition of tesion and Completel
Germany)
In order to compare our organic quarter over quarter financial performance
we have provided a breakdown of the key operating metrics including revenue,
gross margin and EBITDA excluding the financial impact of the consolidation
of the acquisition of tesion and Completel Germany (newly named Versatel
Germany). This quarter will be the last quarter we will breakout these
figures as a result of the integration of these businesses into our existing
operations.
Revenues for 2Q03 were EUR93.1 million (EUR91.6 million on a recurring basis
excluding the recognition of EUR1.5 million of previously unearned revenue
in Germany related to interconnection) compared to revenues of EUR87.1
million in 1Q03 and revenues of EUR70.4 million in 2Q02. On-net revenues
for 2Q03 were EUR68.7 million compared to EUR63.4 million in 1Q03 and
EUR47.0 million in 2Q02.
Versatel's gross margin as a percentage of revenues in 2Q03 was 57.5% (54.3%
on a recurring basis excluding EUR1.5 million of unearned revenue released
in Germany and a EUR2.3 million settlement of prior period network costs in
The Netherlands) compared to 52.5% in 1Q03 and 50.8% in 2Q02.
Selling, general and administrative expenses (SG&A) for 2Q03 was EUR33.2
million (EUR33.9 million on a recurring basis excluding EUR0.7 million
release of over accruals) compared to EUR32.6 million in 1Q03 and EUR33.9
million in 2Q02.
For the quarter ended June 30, 2003, Versatel's adjusted earnings before
interest, tax, depreciation and amortization, restructuring charges, release
of accruals and claim settlements (adjusted EBITDA) was positive EUR15.8
million compared to positive EUR13.1 million in 1Q03 and positive EUR1.9
million in 2Q02.
For the quarter ended June 30, 2003, Versatel's result before interest, tax,
depreciation and amortization (EBITDA) was positive EUR20.3 million compared
to positive EUR28.1 million (including a EUR14.9 million one time settlement
with Deutsche Telekom) in 1Q03 and positive EUR3.0 million in 2Q02.
Raj Raithatha commented, "It is important that the consolidation of our
acquisitions during the quarter not overshadow the performance of the
organic business, which remains healthy. Excluding the acquisitions,
organic quarter over quarter revenue growth was 7% and our sequential
adjusted EBITDA improvement of approximately EUR3.0 million indicates that
we continue to sign up profitable customers."
Revised Financial Guidance
Versatel has updated its previously disclosed 2003 financial guidance issued
in March 2003 to reflect the improvements in its core business and the
acquisition of tesion and Completel Germany (newly named Versatel Germany).
The improvements in our organic business are as a result of the better than
anticipated take up of our residential product offering in the Netherlands
and Germany and our continued success adding new customers in the corporate
market in the Netherlands. Additionally, our revised guidance reflects 9
months of consolidated financials from tesion and Completel Germany (newly
named Versatel Deutschland). Due to the focus on the integration of the two
businesses for the remainder of 2003, we expect minimal growth in these new
businesses before 2004. The following statements are based on Versatel's
current expectations. These statements are forward-looking and actual
results may differ materially.
(EURmillions) Previous Updated
Revenue 325 - 335 440 - 450
Gross Margin % 51% - 54% 50% - 52%
Adjusted EBITDA 40 - 50 60 - 70
Capex 50 - 75 75 - 85
Raj Raithatha commented: "We are pleased at the performance of our
operations in the first half of 2003 and the revised guidance is a
reflection of our view that Versatel's business will continue to show signs
of improvement in the latter half of 2003. As we previously mentioned, the
majority of our capital expenditures are related to business growth and we
therefore expect an increase in correlation to our upwardly revised revenue
growth and the integration of our German acquisitions. In addition, given
the improved market conditions for Versatel, we are investing some of our
excess cash to expand our DSL footprint in Germany and Holland to take
advantage of the strong customer demand for our products, but we do not
expect that we will see the benefit of these investments until 2004."
Versatel Telecom International N.V. (Euronext: VRSA). Versatel, based in
Amsterdam, is a competitive communications network operator and a leading
alternative to the former monopoly telecommunications carriers in its target
market of the Benelux and Germany. Founded in October 1995, the Company
holds full telecommunication licenses in The Netherlands, Belgium and
Germany and has over 1 million customers and over 1,469 employees. Versatel
operates a facilities-based local access broadband network that uses the
latest network technologies to provide business customers with high
bandwidth voice, data and Internet services. Versatel is a publicly traded
company on Euronext Amsterdam under the symbol "VRSA". News and information
are available at http://www.versatel.com
To See Financial Statements:
http://bankrupt.com/misc/Versatel_2Q.pdf
CONTACT: VERSATEL TELECOM N.V.
AJ Sauer
Corporate Finance and Investor Relations Manager
Phone: +31-20-750-1231
E-mail: aj.sauer@Versatel.nl
Anoeska van Leeuwen
Director Corporate Communications
Phone: +31-20-750-1322
E-mail: anoeska.vanleeuwen@Versatel.nl
===========
P O L A N D
===========
NETIA HOLDINGS: Warrant Exercise Ups Share Capital to PLN344 Mln
----------------------------------------------------------------
Netia SA (NET), Poland's largest alternative provider of fixed-line
telecommunications services announced its share capital has increased in
connection with the exercise of certain Netia warrants.
(a) Share Capital.
As of August 1, 2003, Netia's issued and outstanding share capital was
PLN344,212,769 representing 344,212,769 shares, PLN1 par value per share,
each share giving right to one vote at Netia's general meeting of
shareholders.
A motion for the registration of the share capital increase by the Polish
court was filed on August 8, 2003.
(b) Warrants Issued.
As of August 1, 2003, Netia issued 167,557 series J shares pursuant to the
exercise of 96,700 two-year subscription warrants and 70,857 three-year
subscription warrants by their holders at an issue price of PLN2.53 per
share. Each series J share entitles its holder to one vote at Netia's
general meeting of shareholders. Netia's series J shares are publicly
traded on the Warsaw Stock Exchange under the same code as all other
ordinary shares of Netia i.e. PLNETIA00014.
The subscription warrants were exercised in accordance with Netia's Polish
prospectus, dated April 17, 2002, as amended.
(c) Outstanding Warrants.
As a result, these warrants were traded on the Warsaw Stock Exchange as of
August 2, 2003:
(i) 32,327,521 two-year subscription warrants were traded
on the Warsaw Stock Exchange under the ticker "NETPPO2,
entitling their holders to subscribe for Netia's series
J shares by April 29, 2005; and
(ii) 32,353,364 three-year subscription warrants were traded
on the Warsaw Stock Exchange under the ticker "NETPPO3,
entitling their holders to subscribe for Netia's series
J shares by April 29, 2006.
(d) Updated Information on Netia's Share Capital.
Current information on Netia's share capital increases is constantly updated
and available at the Polish National Depositary for Securities and the
Warsaw Stock Exchange as well as on Netia's website
(http://www.investor.netia.pl). The share capital registered currently by
the Polish court reflects the status as of July 1, 2003, and will be amended
following the consideration of a motion filed with the court on August 8,
2003.
Share capital increases in connection with the exercise of Netia's
outstanding warrants will be announced both in Poland and in the U.S. in the
form of a press release once a month by the 8th day of each month, and each
time in the event of an exercise of warrants constituting 5% or more of all
warrants issued by the Company.
CONTACT: NETIA HOLDINGS
Anna Kuchnio, Investor Relations
Phone: +48-22-330-2061
PRZEMYSLOWO-HANDLOWY: Moody's Reviews Financial Strength Rating
---------------------------------------------------------------
Moody's placed on review for possible upgrade the D financial strength
rating of Bank Przemyslowo-Handlowy PBK SA following reports of improvements
in the bank's results since the beginning of the year.
After its merger and restructuring, Poland's third largest bank by total
assets registered a net profit of PLN104.3 million during the first quarter,
an increase of 79% from results of last year's. For the first half, the
bank's net profit was up by 78% to PLN204.6 million (EUR45.9 million) versus
H1-2003.
The review will focus on the structure of revenues, the positive impact of
restructuring efforts on the bank's cost base, asset growth and quality
improvements, risk management, and the risk profile of the bank, according
to the rating agency.
Bank Przemyslowo-Handlowy's Baa1/P-2 deposit ratings remain unchanged,
underpinned by ownership and control by the HVB Group.
TRANS UNIVERSAL: Q4 to Record First Positive Figures in Years
-------------------------------------------------------------
Trans Universal Poland, the only stock-listed transport company, expects to
show its gradual recovery in the fourth quarter of 2003, according to Warsaw
Business Journal.
The company, which has been loss-making since 1999, targets to post its
first positive results in the fourth quarter of 2003, and to edge slightly
in the black next year, said Leslaw Moritz, Eagle International Trading and
supervisory board member of Trans Universal.
Eagle International, which acquired 61.9% of the company by the end of last
year, expects the company to turn into "a firm managing diverse external
fleets of trucks and on contractual carriers," explained Mr. Moritz.
Trans Universal saw changes in its structural organization, strategy, and
management board, under the new shareholder. It also disposed loss-making
and non-core activities.
Leslaw expressed confidence in Eagle's drive saying: "Eagle is an investment
company, which invests in sectors with high growth potential. Despite the
crisis, the logistics sector has been growing by 10% - 15% annually."
===========
R U S S I A
===========
BELOVO: To Close 70-year-old Zinc Factory Within Weeks
------------------------------------------------------
Russia's third-largest zinc company, Belovo, will be closed down after more
than 70 years of operation, a senior Russian zinc lobby official said,
according to The Moscow Times.
"I spoke to a senior Belovo official recently and he told me the plant was
practically dead. They've effectively shut down operations already or will
do so very soon, in coming weeks," the official from the Moscow-based Zinc
Development Center related.
The loss-making company, which was built in 1931, was declared bankrupt in
2000. It was afterwards put up for sale, but the effort failed to turn in a
buyer. A Belovo official at the company's headquarters in Siberia's remote
Kemerovo region said the company does not make any comments about plans for
the plant as yet.
Output of the zinc company declined in recent years, and the firm has been
losing millions of rubles.
"They simply haven't got the cash to survive," the Moscow Times source said.
According to the official the company created under Stalin's rule performed
well under the old regime because the state used to transport raw materials
to them from all over Russia, but now they've hit by transport costs.
"Basically, the only thing you can do is rebuild the plant from scratch, but
that's not feasible because of its unfortunate geographic location," the
source said.
===========
S W E D E N
===========
SCANDINAVIAN AIRLINES: Passenger Traffic, Load Factor Slide
-----------------------------------------------------------
Scandinavian Airlines released this air traffic update recently. The
highlights are:
(a) The SAS Group transported a total of 2.5 million passengers
in July 2003 vs. 2.7 million in 2002, a decrease of 5.9%.
(b) Total passenger traffic decreased by 0.1% vs. 2002.
(c) Overall group passenger load factor decreased by 1.1 p.u to
70.6% for July 2003 vs. 2002.
(d) Market trends and yield development
The traffic development in July indicates improving traffic and load
factors, but a continued strong pressure on passenger yields. Traffic on
North America showed passenger load factors close to 90% in July. Asian
routes started to recover in June and load factors was close to 80% in July.
Bookings on European routes in Scandinavian Airlines are back to 2002-year
level.
Braathens traffic development on Norwegian domestic routes was very weak in
July with continued pressure on yields. Spanair's traffic improved in July
with load factors at the same level as 2002.
Indications of passenger yield development for Scandinavian Airlines in July
indicate a continued pressure as a result of negative mix, a number of sales
campaigns and new market initiatives. Yields for June was down 17% and 12%
for the period Jan-Jun. Yields on the European routes were down 15% in
June, affected by the introduction of the new low fare initiative Snowflake
(8-9 p.u.). Underlying yield development is in line with previous months.
The overall yield development in June and indications for July is in line
with the figures reported for the previous months, but load factors and
traffic development has improved. Forceful cost measures are under
implementation to secure a sustained profitability level in a lower yield
environment. Due to the situation with continued weak economies, the
outlook remains cautious.
The SAS Group will release its 2nd Quarter result on August 11 at
approximately 2.30 p.m. CET.
Scandinavian Airlines
(a) Scandinavian Airlines traffic decreased by 4.9% in July 2003
compared with 2002.
(b) Scandinavian Airlines passenger load factor increased by 0.4
p.u. to 74.5% Intercontinental traffic decreased by 0.5% in
July. Traffic to/from the U.S and South East Asia have
improved significantly. Scandinavian Airlines will resume
its daily traffic to Beijing as from 22 August. The demand
on the European routes has improved and traffic was up 4.3%.
Passenger load factor on the new low price initiative,
Snowflake, was above 80% in July. Intrascandinavian traffic
continued to be weak. Danish domestic traffic was down
mainly as a result of the discontinued Greenland route.
To View Full Report: http://bankrupt.com/misc/SAS_Statistics.pdf
=====================
S W I T Z E R L A N D
=====================
SWISS INTERNATIONAL: Pilots Union, Management Settle Row
--------------------------------------------------------
SWISS is pleased to note that the members of the SWISS PILOTS union have
chosen to follow the advice of their executive committee and have approved
the agreement, which their committee had concluded with the company. Their
approval meets another key requirement for the success of the company's
current restructuring endeavors.
The approval of the proposed agreement by the members of SWISS PILOTS brings
the long-running dispute between SWISS and the former pilots of Crossair to
an end. The agreement offers sizeable advantages to all the parties
involved: both the pilots who will have to leave the company and those who
will remain have elected to accept a fair and generous offer from SWISS; and
the company has been able to bring a conflict which threatened its very
existence to a satisfactory conclusion.
SWISS has already stated that the commitment of all its unions and employees
to its future is essential if its current turnaround efforts are to succeed.
The agreements now reached with its personnel not only create confidence and
trust both within and outside the company; they also provide a sound
foundation on which to tackle and solve its remaining problems and concerns.
In this sense, the approval by SWISS PILOTS marks a further landmark success
in the company's current restructuring endeavors.
CONTACT: SWISS Corporate Communications
P.O. Box, CH-4002 Basel
Phone: +41 848 773 773
Fax: +41 61 582 3554
E-mail: communications@swiss.com
Homepage: http://www.swiss.com
===========================
U N I T E D K I N G D O M
===========================
AMP LIMITED: Moody's Concludes Rating Review with Downgrades
------------------------------------------------------------
Moody's Investors Service concluded its review of the ratings of AMP Group
that follows the insurer's announcement in May of an intention to demerge
its U.K. and Australian businesses.
The rating agency came up with the decision to:
(a) downgrade these ratings, assigning a negative outlook:
AMP Life Ltd Insurance financial strength to A1 from Aa3
AMP Group Holdings Ltd Senior debt to Baa1 from A3
AMP (U.K.) Finance Services plc Senior debt to Baa1 from A3
AMP Group Finance Services ltd Senior debt to Baa1 from A3;
subordinated debt to Baa2 from Baa1
AMP Henderson Global Investors Ltd Preferred stock to Baa3
from Baa2
AMP Bank Ltd Long-term deposit rating to Baa1 from A3
Long-term senior debt to Baa1 from A3
Long-term subordinated debt to Baa2 from Baa1
Long-term junior subordinated debt to Baa2 from Baa1
National Provident Life Insurance financial strength to Baa3
from Baa1
Pearl Assurance plc Insurance financial strength to Baa3
from Baa1
NPI Finance plc Subordinated debt to Ba3 from Baa3
(b) confirm these ratings, assigning a stable outlook
AMP (UK) Finance Services plc P-2 commercial paper
AMP Group Finance Services Ltd P-2 commercial paper
AMP Bank Ltd P-2 commercial paper
D bank financial strength
(c) downgrade and withdraw the ratings for GIO Finance Ltd
Senior debt to Ba1 from Baa3
(d) confirm and withdraw the rating for GIO Finance Ltd P-2
commercial paper.
Moody's expects AMP to significantly lower its debt levels after the group's
completion of its equity-raising plan, with AU$1.75 billion share issuances.
But the reduced level of shareholder equity prompted Moody's to expect that
the company's overall leverage will be higher than before.
The negative outlook for the group's long-term ratings reflects the
uncertainty surrounding the completion of the sale process for certain
non-core assets and the application of such proceeds to reduce debt levels.
It also considers the remaining transaction risk in successfully completing
the demerger process.
AMP LIMITED: Australian Subsidiary Settles GIO Class Action
-----------------------------------------------------------
AMP Limited has announced that its subsidiary AG Australia Holdings Limited
(formerly GIO Australia Holdings Limited) has reached a settlement in
proceedings related to the takeover of GIO in 1999. The settlement is
subject to approval by the Federal Court, which will be sought as soon as
possible.
AMP has signed a heads of agreement with Maurice Blackburn Cashman to settle
this matter. Maurice Blackburn Cashman brought the action on behalf of GIO
shareholders who held shares continuously between August 25, 1998 and
January 4, 1999, and who did not accept AMP's offer due to their reliance on
announcements made by GIO in the takeover period including its Part B
Statement.
If approved by the Federal Court, the settlement involves a total payment of
AU$112 million. AMP's contribution to the settlement will be AU$56.8
million with other parties paying the balance. Subject to resolution of one
outstanding issue with one of the cross-claimants, and subject to
negotiation of final documentation, the settlement will include resolution
of all claims and cross-claims in the proceedings.
The AU$56.8 million to be paid by AMP is covered by reserves held within the
Group and will not impact profit and loss.
AMP Chief Executive Officer Andrew Mohl said he was pleased to be bringing
an end to the litigation related to the GIO takeover.
"We believe we have reached a settlement that is in the interests of all
parties," Mr. Mohl said.
"From AMP's perspective, bringing this matter to an end allows us to focus
on issues including our demerger proposal."
CONTACT: AMP LIMITED
Level 24, 33 Alfred Street
Sydney NSW 2000 Australia
ABN 49 079 354 519
Investor inquiries
Mark O'Brien
Phone: 9257 7053
AMP LIMITED: Chief Executive Gives Update on Demerger Proposal
--------------------------------------------------------------
AMP Chief Executive Officer Andrew Mohl said that in response to
considerable speculation about the business, he wished to provide an update
about the proposed demerger.
Mr. Mohl said that AMP was concerned about the impact of the speculation on
its shareholders.
"The uncertainty is understandable given the complexity of the proposed
demerger and continuing uncertainty about the state of the U.K. life and
pensions industry," Mr. Mohl said.
"While we are still working through many of the issues associated with the
demerger, AMP is anxious to ensure that shareholders understand the company'
s current position."
AMP will report its half-yearly results on August 20, 2003, which will
include an update on the progress of the demerger. However, in the
interests of limiting speculation, AMP can provide these update:
Interim results
AMP's results for the six months to June 30, 2003 will be released on August
20, 2003, following review by the Board.
However, AMP management can confirm that preliminary results for Business
Unit operating margins, underlying Group earnings and U.K. writedowns are
broadly in line with the guidance given on May 1, 2003.
AMP Australia brand
Preliminary Plan for Life data released last week show that AMP recorded a
net inflow of US$58 million in the June quarter, a strong result compared
with major competitors. For the year ended June 2003, AMP recorded a net
inflow of US$751 million, the second best result among the top five
managers, and around 11 per cent of industry net flows.
Mr. Mohl said the figures demonstrated the strength of the AMP brand despite
the difficult conditions in which the company operated in the second
quarter.
"Australian Financial Services is more than holding its own, despite the
tough market conditions and our corporate challenges, demonstrating the
resilience and underlying strength of this business," Mr. Mohl said.
Demerger Proposal
Since the last update on the demerger on June 12, 2003, progress has been
made on the structure of the demerger proposal. In particular:
(a) Strategic plans for the new entities, 'new' AMP and 'new' Henderson,
have been prepared for review by the AMP Limited Board and will be outlined
in the Explanatory Memorandum.
(b) Discussions with regulators are well underway. Regular discussions are
being held with APRA with the key area of focus being AMP's capital
structure as a result of the demerger. The Financial Services Authority in
the U.K. is also reviewing the demerger proposal. The FSA is also focusing
on the capital arrangements and the consequent implications for
policyholders and other customers of the AMP Group in the U.K. AMP is
providing further information as needed by the regulators to assist their
review, conclusion of which will be needed to enable the EM to be lodged
with ASIC. ASIC approval of the EM for the demerger will then be required.
It is anticipated that the EM will be made available to ASIC by late
September.
(b) Rothschild has been appointed to give an independent expert's opinion,
to be provided to shareholders in the EM, as to whether the proposed
demerger is in the best interests of shareholders.
(c) Investment banks Cazenove and UBS have been appointed in the UK to
investigate the feasibility of an early London Stock Exchange listing of
'new' Henderson, in addition to ASX listing.
(d) Ernst & Young is continuing to develop the investigating accountant's
report, which will include historic pro formas for each of the demerged
entities. Tillinghast is developing the consulting actuary's report, which
will include detailed information about embedded values. This information
will be on a more sophisticated basis compared with that previously
available for a life company.
As previously indicated, AMP remains on target to achieve the demerger and
associated steps by the end of 2003, subject to shareholder and necessary
regulatory approvals. The EM detailing the proposal is expected to be
available from mid-October 2003, while the Extraordinary General Meeting
will be held in December 2003.
Mr. Mohl said that AMP is particularly concerned about persistent market
speculation about the post-demerger capital structure of 'new' AMP, and in
particular its Reset Preferred Securities.
The final capital structure for both new entities is yet to be resolved and
remains subject to ongoing discussions with regulators. It will also be
dependent on the outcome of asset sales, with the proceeds of any asset
sales to be used to reduce the debt of 'new' AMP.
However a restructuring of the RPS as part of the demerger proposal is
likely.
AMP would only initiate any such restructuring with the approval of AMP
shareholders to the demerger proposal -- that is, any restructuring would
occur post the EGM.
In the event of the demerger not being approved, it is likely the RPS will
remain as part of AMP's capital base as it will continue to be a relatively
low cost form of capital.
Full details of the proposed capital structures of both new entities will be
provided in the EM.
Approaches for U.K. business
As previously stated, AMP has received several approaches for its UK
businesses. These approaches have not at this stage led to a detailed
proposal to be considered by the AMP Board. As stated in the June 12, 2003
demerger update, any formal offers will be given proper consideration and,
if appropriate, brought to shareholders. Obviously, if this were to occur,
the demerger proposal and related capital restructuring would not proceed.
Concluding remarks
"We recognize that there is considerable speculation in markets which, in
part, reflects a range of possible scenarios and outcomes," Mr. Mohl said.
"We are working to inform investors on the status of AMP against this
uncertainty and the fact that a number of the complex issues associated with
the demerger are yet to be resolved.
"Ultimately, we are focused on maximizing the long term value of the
businesses in AMP and the demerger proposal remains the primary strategic
initiative to achieve that."
CONTACT: AMP LIMITED
Level 24, 33 Alfred Street
Sydney NSW 2000 Australia
ABN 49 079 354 519
Investor inquiries
Mark O'Brien
Phone: +61 2 9257 7053
CORUS GROUP: New Senior Secured Bank Facility Rated Ba3
-------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to Corus Group plc's new
EUR1,200 million senior secured bank facility, while affirming the group's
Corus's B1 senior implied rating and B3 senior unsecured rating. The
outlook is negative.
According to the rating agency, the action reflects the facility's superior
position relative to other debt instruments in the capital structure and the
strong collateral package. The package comprises of share pledges in Corus
Nederland and selected U.K. entities and a floating charge over Corus Group
plc and Corus U.K. subject to a maximum 20% of Corus U.K.'s gross tangible
assets. Key entities within the group, excluding Corus Nederland N.V. also
provided guaranties.
Moody's noted the restructuring measures undertaken by Corus since its last
rating action in April. With that, the rating agency said, "continued
availability and adequacy of headroom under the new facility, which is
essential for Corus' liquidity, assumes sustaining improved results."
The negative outlook, meanwhile, continues to reflect the challenges facing
Corus in its attempts to restore profitability in 2H 2003 in a difficult
environment.
Rated Debt Instruments:
Corus Group plc -- EUR1,200 million secured bank facility maturing July 2006
at Ba3
Corus Finance plc - EUR400 million, Maturity 2006 at B3
Corus Finance plc - GBP200 million, Maturity 2008 at B3.
EURODIS ELECTRON: Issues New Shares to Repair Balance Sheet
-----------------------------------------------------------
Your Board announces proposals to raise approximately GBP17.8 million
(EUR25.2 million), before expenses, by means of an issue of New Ordinary
Shares. The net proceeds will be used, inter alia, to strengthen the
Group's balance sheet and finance the Group's working capital requirements.
The Offer Price of 20 pence represents a discount of 29.8% to the closing
mid-market price of 28.5 pence per Ordinary Share at the close of business
on August 7, 2003, the last practicable date before the publication of this
announcement.
About 89,159,739 New Ordinary Shares are being offered to Qualifying
Shareholders under the Open Offer pro rata to their existing shareholdings
on the basis of: 23 New Ordinary Shares for every 20 Existing Ordinary
Shares held on the Record Date.
If valid applications are not received for all of the Open Offer Shares
being made available under the Open Offer, such number of Open Offer Shares
not so applied for will be subscribed at the Offer Price by placees procured
by Dresdner Kleinwort Wasserstein Securities, as agent for the Company,
pursuant to the terms of the Placing Agreement. To the extent that any Open
Offer Shares, which are not the subject of valid applications under the Open
Offer, are not so placed, Dresdner Kleinwort Wasserstein will, as
underwriters, subscribe for such shares pursuant to the terms of the Placing
Agreement.
This announcement sets out the background to and reasons for the Placing and
Open Offer, which are conditional, inter alia, on the passing of resolutions
to increase the Company's share capital and provide the Directors with the
necessary authorities to allot New Ordinary Shares.
Summary of the Placing and Open Offer
The company intends to raise up to GBP16.1 million (EUR22.9 million), net of
expenses, by the issue of 89,159,739 New Ordinary Shares pursuant to the
Placing and the Open Offer. Irrevocable undertakings have been received
from certain
Qualifying Shareholders not to accept the Open Offer in respect of, in
aggregate, 13,103,555 Open Offer Shares. Of these, 3,250,000 New Ordinary
Shares have been placed firm at the Offer Price with Lattice and WPG,
1,617,751 New Ordinary Shares are expected to be placed firm with certain
Directors and employees and the balance will be placed firm with
institutional investors.
76,056,184 New Ordinary Shares will be conditionally placed at the Offer
Price with institutional investors, but are subject to claw back to satisfy
valid applications by Qualifying Shareholders under the Open Offer.
Qualifying Shareholders are being given the opportunity to participate in
the fundraising by way of the Open Offer, which is being made by Dresdner
Kleinwort Wasserstein on the company's behalf.
Open Offer
Qualifying Shareholders are being offered the opportunity to apply for Open
Offer Shares at the Offer Price, subject to the terms and conditions set out
in the Prospectus and in the Application Form, payable in full in cash on
application and free of all expenses on the basis of:
23 New Ordinary Shares for every 20 Existing Ordinary Shares held at the
close of business on the Record Date and so in proportion for any other
number of Existing Ordinary Shares then held. Entitlements to Open Offer
Shares will be rounded down to the nearest whole number of Open Offer
Shares.
Fractional entitlements to Open Offer Shares will not be allotted and will
be aggregated and placed for the benefit of the company.
If valid applications are not received for all of the Open Offer Shares
being made available under the Open Offer, such number of Open Offer Shares
not so applied for will be subscribed at the Offer Price by places procured
by Dresdner Kleinwort Wasserstein Securities, as agent for the company,
pursuant to the terms of the Placing Agreement. To the extent that any Open
Offer Shares, which are not the subject of valid applications under the Open
Offer, are not so placed, Dresdner Kleinwort Wasserstein will, as
underwriters, subscribe for such shares on the terms and conditions set out
in the Placing Agreement.
To be valid, completed Application Forms and payment in full must be
received by 3.00 p.m. on September 1, 2003. Application Forms are personal
to Qualifying Shareholders and may not be transferred except to satisfy bona
fide market claims. Qualifying Shareholders should be aware that the Open
Offer is not a rights issue, and therefore any Open Offer Shares not applied
for under the Open Offer will not be sold in the market for their benefit.
Further details of the terms and conditions of the Placing and Open Offer
are set out in the Prospectus.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: Expects Market Share Boost After Refinancing
--------------------------------------------------------------
Information on Eurodis Electron
The Group today
Eurodis Electron is now Europe's third largest distributor of electronic
components, shipping approximately 300 million units per month, behind its
two largest competitors Arrow Electronics Inc and Avnet Inc. The Group has
a European focus with 40 offices in 19 countries.
Eurodis Electron distributes three main types of components:
Component Example Major suppliers
Actives Semiconductors Ericsson, Epson, Hitachi,
Infineon, Intel,
International Rectifier,
Lattice
Semiconductor, Linear
Technology,
Mitsubishi Electric, Nordic
VLSI ASA,
Philips, Renesas, Sharp, ST
Micro
Electronics and Toshiba
Passives Capacitors AVX, BC Components, Bourns,
Epcos, Kemet,
Phicomp and Yageo
Electromechanical Connectors AMP, FCI, Omron, Sauro and
Tyco
Electronics
The Group's products serve a wide range of application segments. The largest
segments, industrial and subcontracting, accounted for 56% of sales for the
year ended May 31, 2003. The remaining sales were spread across a further
15 segments including telecommunications, security, automotive and medical.
From its central warehouse based in the Netherlands, Eurodis Electron
supplies approximately 18,000 customers with next day delivery capability
throughout Europe. Customer service is enhanced by the Group's integrated
pan-European IT system, which harmonizes the processes from ordering through
to delivery.
Sales support is provided by empowered local companies making decisions
close to the customer thereby enabling the Group to respond more effectively
to client demands. This support is supplemented by technology centres,
staffed by technically skilled staff; this is an important service to many
of the medium sized OEMs, which comprise the majority of Eurodis Electron's
customers.
The central warehouse provides a single interface for suppliers for delivery
and invoicing. Eurodis Electron's strategy of providing quick access to top
management, as well as sharing the resources of the franchise centers and
technology centers, has enabled the Group to build alliances with suppliers
across Europe, the United States and Asia.
The company gained market share in calendar 2001 and 2002, although since
the beginning of calendar 2003, it has suffered a slight decline. The
Directors believe that, once the refinancing process is completed, the
company will begin to increase market share again.
The semiconductor market
The semiconductor market is Eurodis Electron's most important market,
accounting for approximately 60% in value of Eurodis Electron's sales in the
year ended May 31, 2003. This market is highly cyclical and saw a
significant decline by value in world sales between calendar years 2000 and
2002. The effect in the
European market was a decline in 2001 of approximately 29% and is believed
to have been a further 9% decline in 2002. This impacted heavily upon
Eurodis Electron's results and was a key reason for the decline in Eurodis
Electron's sales over the last two financial years. There have recently
been signs of an upturn in the semiconductor market with worldwide demand
and supply balance improving:
(a) World-wide sales of semiconductors for the industry as a whole were up
14.3% for the year to May 2003 when compared against the previous year.
European sales were up 14.6% in the first quarter of 2003 when compared to
the corresponding period in 2002. (source: WSTS).
(b) WSTS is forecasting growth in the semiconductor market of approximately
11.5% in 2003 and 18.4% in 2004 against a growth rate in recent times of,
excluding the exceptional decline of the last two years, at least 15% per
annum.
(c) Eurodis Electron's largest two competitors, Arrow and Avnet, reported
that their component sales for the quarter ended 30 June 2003 grew by
approximately 15.2% and 2.0% respectively when compared with the same period
in 2002.
(d) With volumes of worldwide sales of semiconductors rising in the year to
May 2003, not least due to increased demand in China and Eastern Europe for
PC, mobile and consumer products, and capital expenditure on new fabrication
plants falling, the Board believes there is likely to be upward pressure on
demand for, and average selling prices of, semiconductors.
Following the completion of Eurodis Electron's refinancing exercise, the
Board believes the Group will be well placed to benefit from this expected
upturn.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: Reduces Monthly Operating Expenses Up to 30%
--------------------------------------------------------------
To counteract the longest and deepest downturn of recent times in the
semiconductor industry, the Board has fundamentally restructured the
business to create a highly centralized model that retains empowered local
sales organizations, has high levels of efficiency and strong operational
gearing going forward. The key steps taken in this restructuring were:
(a) Closing Eurodis Electron's eight European warehouses and replacing them
with a central logistics and warehouse facility in the Netherlands.
(b) Centralizing all of Eurodis Electron's non customer-facing activities.
(c) Significantly reducing the number of suppliers to the Group to enable
the Group to focus on its key supplier relationships.
(d) Reducing headcount from 1,278 to 807.
Restructuring costs of EUR12.3 million in the financial year to May 31,
2002, followed by costs of EUR23.4 million in the financial year to May 31,
2003 and in addition to EUR18.0 million invested in the new logistics center
means the Group has incurred total costs of EUR53.7 million in connection
with the restructuring over the last two years. With these changes now
complete the Group achieved an approximate 30% reduction in monthly
operating expenses in the second half of the year to May 2003 when compared
to the second half of the year to May 2001. The Board believes that the
Group can now support similar sales levels to those reached in the financial
years ended May 31, 2001 with a sharply reduced cost base and therefore
generate significantly improved margins. The Board expects to be able
further to reduce operating expenses over the course of the current
financial year.
Eurodis Electron's strategy
Eurodis Electron's strategy is based around building a streamlined business,
which is better able to focus on servicing its customers' needs. As
detailed above, the company has already taken considerable steps to improve
operational efficiencies by developing a common IT platform, introducing
centralized purchasing and moving to a single advanced logistics center.
The Group has refocused its supplier relationships, scaling down to 27 key
and 80 complementary suppliers from approximately 400 in 2001, and is
placing increasing emphasis on customer relations by creating flexible,
customer-focused, local sales organizations.
The Board believes that, with these actions completed, the Group is in a
much stronger competitive position to enable it to take advantage of the
expected upturn in market conditions.
Summary financials
Years ended 31 May
(unaudited)
EUR000's 1998 1999 2000 2001 2002 2003
Net sales 10,395 469,912 503,835 731,771 565,811 438,152
Gross profit* before
restructuring costs
102,250 93,712 93,774 138,393 104,302 72,870
% 20.0% 19.9% 18.6% 18.9% 18.4% 16.7%
Operating expenses before
restructuring costs and
goodwill
(83,451) (83,667) (78,883) (107,087) (91,756) (78,861)
% (16.4%) (17.8%) (15.7%) (14.6%) (16.2%) (18.0%)
Profit (Loss) before tax
and exceptionals
14,984 6,401 10,546 21,924 4,531 (13,040)
% 2.9% 1.4% 2.1% 3.0% 0.8% -
*Figures for 1998 to 2002 (inclusive) have been adjusted to include other
operating income.
Note: Eurodis Electron acquired Ericsson's electronic component distribution
business on 29 September 2000.
Further financial information on Eurodis Electron will be set out in the
Prospectus expected to be posted to shareholders.
Shareholders should read the whole of the Prospectus and not rely on the
summarized information set out above.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: Plans Larger, Longer-term Refinancing
-------------------------------------------------------
Background to and reasons for the Placing and Open Offer
On April 30, 2003 the Group released its third quarter trading release that
said:
In our interim statement at the beginning of February 2003, we reported a
fractional improvement in activity levels. While this continued through
February, orders have flattened off again in the last eight weeks. The
general economic uncertainty is still affecting business confidence
throughout Europe, and we are, therefore, cautious as to the timing of any
upturn in the electronic component market.
Operating expenses, which have been reduced by almost 30% in the last 24
months, remain under tight control to offset as much as possible the effects
of the market conditions. Operating cash-flow remains broadly neutral and,
to the extent that our financing facilities fluctuate with the level of
sales, this has been offset by lower working capital, which we aim to reduce
further in the coming months.
In what continues to be exceptionally difficult market conditions, the only
positive signs are that sales volumes throughout the product range have
started to rise and that average selling prices of semiconductors, which
account for two thirds of our sales, have stabilized.
In respect of the announcement made on April 22, 2003 concerning the
preliminary discussions being held which may or may not lead to an offer for
the entire issued share capital of the company, these are continuing. A
further announcement will be made when appropriate.'
Since that date trading conditions have remained very difficult, and despite
the measures taken by the Board, the Group faces a requirement for
additional working capital funding. The Group has secured conditional
proposals to refinance certain of its facilities with larger and longer-term
arrangements.
These proposals are all conditional on the Group securing additional finance
through an equity issue.
To provide the necessary financial resources, the Board has concluded, after
considering a number of options, that the Placing and Open Offer, at a
significant discount to the prevailing market price, is the most appropriate
course of action.
In reaching this decision, the Board has taken account of the
considerations:
(a) The Board considers that despite the significant economic and
operational risks the Group faces, the Group has considerable potential
which can be realized once the company is better capitalized;
(b) To deliver significant improvements in efficiency, the Group has made a
major investment in a central logistics and warehouse facility in the
Netherlands, which is one of the most technologically advanced of its type.
After the closure of eight other European warehouses the facility became the
Group's single logistics facility, delivering significant economies of
scale; and
(c) As described above there are indications that market conditions have
improved in the first quarter of 2003. The Board believes that once the
Group has been refinanced it will be able to benefit from the expected
improvement in market conditions.
The net proceeds of the Placing and Open Offer will be used to reduce
indebtedness to certain suppliers of the Group who have been supplying the
Group on extended credit terms and to pay expenses related to the debt
restructuring.
The balance will be applied to provide ongoing funding for the Group's
working capital requirements.
Indebtedness and financing facilities
Currently, the Group's working capital requirements are provided for through
a combination of negotiated credit with suppliers (some of which are
currently being provided on an extended basis due to the present financial
position of the Group), facilities secured against receivables or stock,
term loans, finance leases, intra-group arrangements and bank overdrafts.
The Group net debt as at May 31, 2003 was GBP62.8 million (EUR87.5 million),
comprising cash at bank of GBP5.2 million (EUR7.3 million), GBP16.8 million
(EUR23.4 million) of secured debtor finance, GBP12.6 million (EUR17.5
million) of unsecured debtor finance, GBP5.2 million (EUR7.3 million) of
secured inventory finance, GBP6.5 million (EUR9.0 million) of secured bank
loans, unsecured bank loans of GBP2.7 million (EUR3.8 million), GBP19.7
million (EUR27.5 million) of overdrafts and GBP4.5 million (EUR6.3 million)
of finance leases. Total facilities available at May 31, 2003 amounted to
GBP79.8 million (EUR111.2 million).
Facilities secured against stock and receivables
The Group's main provider of facilities secured against receivables and
stock is currently NMB Heller. Under the existing facility agreements, it
advances monies secured on, inter alia, amounts due from the Group's
customers in the U.K.,
Benelux and Germany and on the Group's stock, held centrally in the
Netherlands.
As part of the re-financing of the Group, it is proposed that the Group's
current facilities provided by NMB Heller will be terminated. A new
facility, to be provided by Burdale pursuant to the Burdale Facility
Agreement, will replace the facilities from NMB Heller secured against U.K.
and Benelux receivables and against the Group's stock. A new facility, to
be provided by Lloyds TSB pursuant to the Lloyds TSB Facility Agreement,
will replace the NMB Heller facility secured against the German receivables.
The change in facility providers is expected to result in an increase in
facilities of approximately EUR11 million available to the Group.
The Burdale Facility Agreement and the Lloyds TSB Facility Agreement are
both conditional upon the Placing Agreement becoming unconditional in all
respects (save for any conditions in the Placing Agreement relating to those
two agreements becoming unconditional or admission of the New Ordinary
Shares).
Shareholders should be aware that, as is usual in these kinds of facilities,
the amounts available under the Burdale Facility Agreement and the Lloyds
TSB Facility Agreement are dependent on the profile of the stock held by,
and the receivables due to, the Group at any time. The Burdale Facility
Agreement and the Lloyds TSB Facility Agreement regulate which stock and
receivables of the Group can be lent against and Burdale and Lloyds TSB can
each unilaterally reduce the facilities provided by them depending on the
profile of the Group's stock and receivables at any particular time.
GE Factofrance currently provides Eurodis Electronics France with a
factoring facility with a current approximate utilization of EUR4.4 million.
GE Factofrance has given notice to terminate this facility on October 8,
2003, but agreed to replace it with a revised factoring facility. This new
facility will become unconditional, in effect, upon the Placing Agreement
becoming unconditional in all respects (save for any conditions in the
Placing Agreement relating to such agreement becoming unconditional or
admission of the New Ordinary Shares).
Further details of the Burdale Facility Agreement and the Lloyds TSB
Agreement and the facility agreements with GE Factofrance will be set out in
the Prospectus.
The Group's working capital needs are typical of those of an electronic
component distribution business. As sales decline, the Group's working
capital and stock and receivables facilities all reduce. As sales increase,
these facilities will increase along with the Group's indebtedness, though
this indebtedness will decline to the extent that the Group starts to
generate free cash flow.
Other facilities
In addition to the above, the Group has a number of other facilities
available to it, upon which it relies, to meet future working capital needs,
including a number of uncommitted overdrafts and receivables discounting
facilities for a sum totaling, in aggregate, GBP32.3 million (EUR45.0
million). By their nature, these facilities are repayable on demand.
Whilst the Board is not currently aware of any reason why these facilities
would be withdrawn, shareholders should be aware that these remain
uncommitted and could be withdrawn at any time.
Working Capital
The Company considers that, taking into account the bank and other
facilities currently available to it and those which will be available to it
following completion of the Placing and Open Offer and receipt of the
minimum net proceeds from the Placing and Open Offer, the Group has
sufficient working capital for its present requirements, that is for at
least the 12 months from the date of this announcement.
Shareholders should be aware that if the Placing and Open Offer does not
proceed the Board could not confirm that the company will have sufficient
working capital for its present requirements -- that is, for at least the 12
months from the date of this announcement. Shareholders should also be
aware that, whilst the Company has received assurances from the providers of
those of the Group's uncommitted facilities taken into account in assessing
the Group's working capital that they see no reason why such facilities
should not continue in the normal course of business, all such facilities
remain repayable on demand or subject to short notice of withdrawal.
In either of these events, the company would be required to immediately seek
to renegotiate its facilities and/or take alternative action, which would be
likely to include seeking the sale of certain assets, to meet its
liabilities as they fall due. The Board considers that the further
renegotiation of its facilities and/or taking alternative action would be
difficult and that there can be no certainty that either of these actions
would be successful, in which event the company may enter into
administration or receivership.
2003 Results
In the year to May 31, 2003, the Group achieved sales from continuing
operations of EUR438.2 million (2002: EUR532.4 million), an operating loss
from continuing operations before restructuring costs and goodwill
amortization of EUR6.0 million
(2002: EUR9.0 million profit) and an operating loss of EUR30.5 million
(2002: EUR0.9 million). The full announcement of the Group's unaudited 2003
results is announced separately.
Current trading and prospects
The Group's trading in June 2003, following the May 31, 2003 year-end, was
in line with expectations, although sales and margins in July 2003 have been
impacted by the Group's current funding position. Once the proposed
refinancing has been completed, the Directors believe that the Company will
resume its progress in gaining market share which, with even a small
improvement in market conditions, which the Board expects to become evident
in the next few months, should lead to a significant improvement in the
Company's trading performance for the current financial year to May 31,
2004.
With the Company placed on a firmer financial base, combined with the early
tentative signs of a healthier market, the management faces the future
reinvigorated and determined to succeed.
The company has created a more efficient, integrated organization with a
much lower cost base than it had two years ago and the Board believes that
this will allow the company to be more responsive to future market
fluctuations.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: Intends to Appoint New Directors
--------------------------------------------------
The Board
Following completion of the refinancing, the Board currently intends to
strengthen the management of the Group with certain new board appointments,
including the appointment of at least two further non-executive directors.
Dividend Policy
In April 2003, the company did not pay the dividend due on the Preference
Shares. The dividends due on the Preference Shares accumulate and must be
paid before any payment of dividends to holders of Ordinary Shares. The
current performance and position of the Company make it inappropriate for
the Directors to recommend a final dividend. The Directors expect to resume
dividend payments once the Group's profitability and reserves recover.
Offer talks
In April 2003, the company announced that it was in preliminary bid talks.
Discussions regarding a possible offer for the Company, although continuing,
remain very preliminary.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: To Dispose of Pioneer Shareholding
----------------------------------------------------
Disposal of Pioneer shareholding
Pioneer has owned 10,000,955 Ordinary Shares for a number of years, which
represent approximately 12.9% of the existing issued ordinary share capital.
Subject to Dresdner Kleinwort Wasserstein Securities identifying and
securing sufficient undertakings from potential places to place the Open
Offer Shares, Dresdner Kleinwort Wasserstein Securities will seek to
conditionally place the Pioneer Shares at the Offer Price and expected to
become unconditional. In consideration, Pioneer has irrevocably undertaken
(i) to vote in favor of all of the Resolutions; (ii) not to take any shares
under the Open Offer; and (iii) other than proposed to the proposed placing
described above, not to sell any remaining Ordinary Shares until the earlier
of (a) the announcement of the Group's interim results in 2004, and (b) 28
February 2004 without the prior approval of Dresdner Kleinwort Wasserstein
Securities.
General
The Placing and Open Offer are conditional, inter alia, upon:
(i) the passing of resolutions to increase the Company's
share capital and provide the Directors with the
necessary authorities to allot New Ordinary Shares;
(ii) the Burdale Facility Agreement and the Lloyds TSB
Facility Agreement having become unconditional and
having completed;
(iii) the Placing Agreement having become unconditional in
all respects (otherwise than in respect of the condition
as to Admission) and not having been
terminated or rescinded in accordance with its terms;
and
(iv) Admission becoming effective by not later than 8.30
a.m. on September 5, 2003 or such later time and/or
date as the Company and Dresdner Kleinwort Wasserstein
may agree being not later than October 31, 2003.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
EURODIS ELECTRON: Directors to Subscribe for Additional Shares
--------------------------------------------------------------
Subscriptions by Directors
In addition to subscriptions by Steven Swayne, Barry Charles and Philip
Stephens under the Open Offer, it is proposed that these directors and
Marie-Anne van Ingen subscribe for in aggregate, an additional 612,988 New
Ordinary Shares on a firm basis to demonstrate their commitment to the
company.
The company has received irrevocable undertakings from each of Robert Leigh
and Peter Vey not to take up, in aggregate, 1,602,457 Open Offer Shares to
which they are entitled, representing approximately 0.96% of the Enlarged
Issued Share Capital. Robert Leigh will be taking up the balance of his
entitlement being 25,000 shares.
Prospectus
It is expected that the Prospectus, setting out full details of the Placing
and Open Offer, containing further information on the Company and the Notice
of the Extraordinary General Meeting, will be posted to shareholders,
accompanied in the case of Qualifying Shareholders by the Application Form.
Application Forms will be personal to Qualifying Shareholders and may not be
transferred except to satisfy bona fide market claims.
To See Full Copy of Planned Placement and Open Offer:
http://bankrupt.com/misc/Eurodis_Electron_PLC.htm
CONTACT: EURODIS ELECTRON PLC
Robert Leigh, Chairman
Phone: 01737 242 464
Steve Swayne, Chief Executive
DRESDNER KLEINWORT WASSERSTEIN LIMITED
Charlie Batten
Phone: 020 7623 8000
Christopher Baird
EURODIS ELECTRON: Loss Before Tax Balloons to GBP39.4 Million
-------------------------------------------------------------
Eurodis Electron PLC, third largest distributor of electronic components in
Europe, reports unaudited preliminary announcement for the year ended May
31, 2003.
Key Statistics
Euro Euro Sterling Sterling
2003 2002 2003 2002
-------- -------- -------- --------
Sales from continuing
operations 438m 532m 288m 329m
Operating (loss)/profit from
continuing operations before
restructuring costs and
goodwill amortisation (6.0m) 9.0m (4.0m) 5.6m
(Loss)/profit before tax,
restructuring costs,
goodwill amortisation and
non operating items (13.0m) 4.5m (8.6m) 2.8m
Loss before tax (39.4m) (4.1m) (25.9m) (2.6m)
Basic loss per ordinary
share (51.79c) (12.17c) (34.02p) (7.51p)
Adjusted loss per ordinary
share (18.64c) (0.67c) (12.25p) (0.41p)
Dividends per ordinary
share - 6.68c - 4.23p
Commenting on the results and prospects, Robert Leigh, Chairman, said:
"The electronic component market continued to be in the longest and deepest
downturn in recent times for most of our financial year. We are now
beginning to see a slight increase in component manufacturing capacity
utilization and prices are also stabilizing. Although we retain a cautious
outlook on the market, we believe that with the prospect of the refinancing
deal and a lower cost base, we are well placed for an upturn."
To View Full Report And Financials:
http://bankrupt.com/misc/Eurodis_Electron.htm
CONTACT: EURODIS ELECTRON PLC
Robert Leigh, Chairman
Phone: 01737242464
Steven Swayne, Chief Executive
Phone: 01737242464
Michael Mason, Group Finance Director
Phone: 01737242464
BELL POTTINGER FINANCIAL
John Coles / Billy Clegg / Zoe Sanders
Phone: 02078613232
FOOTBALL CLUBS: Smaller Football Clubs Face Crisis, Survey Shows
----------------------------------------------------------------
Only 24% of football clubs expect to make a profit at year end according to
"Financing football 2003" -- the second survey of English and Scottish
Premier League and English First Division finance directors by accountants
and business advisors, PKF. It shows the gap between the Premiership and
the rest of the league is now irreversible with clubs outside the
Premiership forced to reinvent their business models or face extinction.
The 2003 survey is the most up-to-date view of football finance currently
available. It maps the views of 21 finance directors -- 15 from English
Premier and First Division clubs and 6 from the Scottish Premier League and
shows that the U.K.'s top football clubs are borrowing heavily with only a
small percentage expecting to make a profit. Of those surveyed, 43% have
increased their borrowing in the past 12 months and 57% envisage using more
than 90% of their bank facility during the forthcoming year.
While the Premiership still sees TV income as its most important revenue
stream, ticket sales are now the most important source of revenue for the
English First Division and Scottish Premier League -- reinforcing the view
that a loyal local fan base is critical to their survival.
There is some evidence that the industry is now facing up to the cash
crisis -- in last year's survey, only 14% of Premiership clubs would
consider the emotive issue of ground sharing compared to 40% of Premiership
and First Division clubs and 33% in the Scottish Premier League this year.
Clubs also have different concerns for the future. Last year, escalating
players' salaries were the biggest concern -- this year, 100% of Premiership
FDs saw the potential fall in TV income when the current BskyB deal expires
as their biggest worry. Those in the First Division and Scottish Premier
League were most concerned about an overall reduction in transfer values,
inflexible players salaries and the consequent knock-on effect on their
income profitability.
Finance directors are not happy with rival clubs falling into administration
to clear debts -- over two thirds of those questioned believe that clubs
going into administration should face a points deduction. Only a quarter
(24%) believe financially-weak clubs should be demoted.
Stuart Barnsdall, PKF Partner said, "The next two years will be crucial for
smaller clubs. Never before has the polarization within football been so
apparent with the elite of the game clearly running away with the spoils.
"With the market for football now proven to be finite and largely restricted
to the most powerful, those who do manage to survive face the prospect of
re-inventing their business models based on non-TV related income targeted
at a local market. Clubs who fail to respond to the changing environment
are unlikely to exist in the long term."
Highlights of PKF's "Financing football - the new reality" survey August
2003
(a) Outlook for profit remains poor
Only 17% of Scottish Premiership clubs expect to make a profit at year-end
compared with 30% of English Premiership clubs and 20% of English First
Division.
(b) Players salaries are linked to performances on the pitch
71% of clubs now implement salary packages, which reflect performance with
the majority of clubs believing the performance element should be linked
purely to results on the pitch. 55% of respondents in the First Division
and Scottish Premier League reduce salaries if the club suffers relegation.
Only 10% of Premiership clubs regard the introduction of salary capping as a
good idea compared with 80% in the First Division and 50% in the Scottish
Premier League. 52% of FDs believe players should be paid for their image
rights reflecting the changing nature of the commercial football business.
(c) Super creditor rule provides clubs with increased certainty
43% of FDs think football players should lose their status as
super-creditors (so called, super priority creditors). Under the current
rules, clubs in administration cannot restructure until they have paid
"football debts" in full, making it far harder for the clubs to manage their
financial burden. More surprisingly, 33% are in favor of retaining the
status -- last year only 13% of FDs believed players should retain their
status.
48% think that clubs should not lose their super-creditor status (although
it is surprising that 33% believe clubs should lose such status). This
could reflect the fact that clubs are more financially exposed and the super
creditor rule provides them with increased certainty.
(d) Agents losing their powerbase
While recognizing their usefulness, 62% of FDs think agents add cost. 38%
of clubs believe agents are too powerful, down from 78% last year. This may
reflect the fact that the significant shift in supply and demand means
agents have lost some of their trump cards at the negotiating table.
(e) Conflict of interest
81% believe football managers should not be able to own shares in agencies,
which their clubs uses, reflecting the fact that shareholdings represent a
clear conflict of interest and can only be bad for the game.
(f) TV - U.K. clubs back collective selling of rights
Against the possibility of the EC imposing the fragmentation of football
media rights, restricting exclusivity and enforcing individual selling, 100%
of clubs in the Premiership and First Division support the collective
selling of TV rights.
Premiership clubs find the current method of allocation of funds acceptable,
only 60% and 50% respectively of clubs in the First division and Scottish
Premier League agree.
(g) Changing priorities regarding income streams
TV income is still regarded as the most important revenue stream for
Premiership clubs however, ticket sales are now most important to clubs in
the First Division and Scottish Premier League. In 2002, TV and radio deals
were seen as the most important revenue stream for first division clubs but
lesser teams may no longer be able to rely on a healthy distribution of TV
income. The true potential of the Internet and wireless communications is
still considered to be out of reach with only 24% of clubs considering it to
be an important source of income in the next three years.
(h) Transfer income is no longer as important but money talks
71% of clubs say their 2003/4 transfer budget does not rely on receiving a
surplus of funds from outgoing transfers, reflecting the fact that the
market has shrunk significantly. Overall, 76% say they would sell their
best playing asset if the price was right with 100% of Scottish Premier
League FDs willing to sell if the price was right compared to 80% first
division and 60% of the Premiership.
(i) Transfer windows
80% of Premiership FDs are happy with the operation of transfer windows.
Only 20% and 33% of First Division and Scottish Premier League clubs share
their satisfaction.
(j) Sale and Leaseback
Almost a quarter of the clubs surveyed (30% in the premier, 40% in the First
Division and none in the Scottish Premier League) used off-balance sheet
finance, which was a product of the football boom. Now that values have
fallen, it is unlikely that this source of players finance will be readily
available in the short term.
Copies of the PKF "Financing football - the new reality" 2003 survey are
available free by emailing the PKF Football Services Group
charley.gardner@uk.pkf.com where back copies of the 2002 survey can also be
ordered.
*****
PKF's Football Services Group offers a range of leisure consultancy,
corporate finance, corporate recovery and ongoing audit and tax work to some
of the leading U.K. Football Clubs including Celtic FC, Dundee FC, Fulham
FC, Liverpool FC, Motherwell FC, Oldham FC, and West Ham FC.
PKF is one of U.K.'s leading firms of accountants and business advisors with
more than 1,600 partners and staff operating in 27 offices around the
country. Principal services include: assurance and advisory; consultancy;
corporate finance; corporate recovery and insolvency; forensic; and
taxation. The firm has particular expertise in sectors such as: charities;
technology and e-commerce; hotel and leisure; medical; professional
partnerships; and public sector. PKF's web site address is
http://www.pkf.co.uk/.PKF also offers financial services through its FSA
registered company, PKF Financial Planning Limited.
Methodology - The PKF Financing Football survey was carried out among
finance directors of football clubs throughout the English Premiership and
First Division clubs and the Scottish Premiership clubs. We invited each
finance director to participate in the survey, which was subsequently
completed by telephone interview in the last 2 weeks of June 2003. This
report reflects the view of 21 of a total of 55 finance directors.
Individual responses were provided anonymously and an independent research
company to maintain strict confidentiality conducted interviews.
HENDERSON ABSOLUTE: Board Favors Voluntary Liquidation
------------------------------------------------------
As announced on July 25, 2003, the extraordinary general meeting of the
company convened for that day, to consider resolutions in connection with
the proposed tender offer, was adjourned. The adjournment was necessary
because the Board had received a requisition from Carrousel Capital Ltd. for
alternative proposals to be put to the company's shareholders.
Having considered the options available to the company and consulted a
number of major shareholders, the Board considers that it is in the best
interests of the company and shareholders as a whole that proposals relating
to a voluntary liquidation of the company are put to shareholders. In
response to such proposals, Carrousel Capital Ltd. has agreed to withdraw
its requisition.
The Board will be writing to shareholders in October setting out their
recommendations in relation to the liquidation proposals with a view to
returning cash to shareholders in January 2004.
In the context of these developments, and in order to minimize the cost to
the company, the Board will immediately be giving Henderson Global Investors
Limited 12 months' notice of termination of the management agreement in
accordance with its terms.
CONTACT: HENDERSON GLOBAL INVESTORS
Stephen Westwood
Phone: 020 7818 5517
Stephen Phillips
Phone: 020 7818 6417
UBS LIMITED
Will Rogers
Phone: 020 7569 2939
Nicholas Rucker
Phone: 020 7568 8574
LONDON FORFAITING: Resurge Plc Mulls Share, Cash Offer for Firm
---------------------------------------------------------------
Shareholders of London Forfaiting Company PLC will be aware of the
announcement by Resurge Plc that it was in discussions with the Board of
London Forfaiting Company, which may or may not lead to an offer for London
Forfaiting Company.
Resurge remains a potential bidder for London Forfaiting Company despite the
imminent first closing date of the cash offer by FIMBank (U.K.) Limited for
London Forfaiting Company.
Resurge is contemplating making a share offer for London Forfaiting Company
at a value that would be competitive with the offer by FIMBank. Resurge may
also offer a partial cash alternative to such a share offer. A share offer,
if made, would provide London Forfaiting Company shareholders with an
opportunity to maintain an interest in London Forfaiting Company, which
Resurge believes has attractive opportunities going forward given
appropriate capital and management support. Resurge believes that LFC would
represent an excellent, complementary investment opportunity.
Resurge intends to continue its discussions with the Board of London
Forfaiting Company, its advisers and with its shareholders with a view to
concluding negotiations as soon as possible. In the interim, London
Forfaiting Company shareholders are urged not to accept the FIMBank offer.
It should be noted that this announcement does not constitute an
announcement of a firm intention to make an offer for London Forfaiting
Company, as defined under Rule 2.5 of The City Code on Takeovers and
Mergers, and that it is not certain that a firm offer by Resurge will be
forthcoming.
This announcement, for which Resurge is responsible, has been approved by
ARM Corporate Finance Limited for the purposes of Section 21 of the
Financial Services and Markets Act 2000.
CONTACT: RESURGE PLC
Jamie Constable Joint managing director
Phone: 020 7233 4270
Jonathan Rowland, joint managing director
Phone: 020 7233 4270
MALLETT PLC: Expects Woes to Drag on as Pre-tax Profit Drops 60%
----------------------------------------------------------------
In our trading statement issued on June 6, 2003, we stated that we expected
the company's profit before taxation for the six months ended June 30, 2003
to be well below the figure reported for the equivalent period last year.
In the event, turnover for the first six months was down 27% from
EUR11,223,000 to EUR8,187,000 and profit before tax was down 60% from
EUR2,766,000 to EUR1,106,000. While we were able to maintain our trading
margins, profit before tax fell proportionately more than turnover as a
result of the company's fixed cost base. Earnings per share were 5.61p
compared with 13.80p for the equivalent period in 2002. The board has
declared an unchanged interim dividend of 2.4p, which will be paid on
September 15, 2003 to shareholders on the register on August 29, 2003. Our
net asset value per share has increased to EUR2.08, compared with EUR2.00 at
June 30, 2003, but this does not take account of any possible increase in
the value of our property and other assets over their book value. The
company's principal asset, Bourdon House, and the complicated leases
relating thereto are currently being reviewed by the Board, in conjunction
with its advisers, in order to assess how to maximize the benefit of this
asset for the Company and its shareholders.
Our new flagship store in New York opened at the end of April. The total
refurbishment cost was approximately EUR2.5 million and was completed
without incurring any debt. This operation has received a great welcome
from our clients and we are pleased with early trading. Business has been
done both with new and existing clients and, in particular, with clients not
intending to visit London. It is clear that the overall level of business
transacted would not have been achieved by the London shops alone. We also
produced a catalogue of modern items, which is aimed at the U.S. decorator
market and is proving successful.
The first six months trading was disappointing and coincided with the
outbreak of SARS and the war in Iraq. This, together with the global
economic unrest, led to a reduction in the number of overseas visitors
traveling to London. There has, however, been an increase in visitors to
our London shops recently and New York is performing above expectations.
Despite some encouraging signs, we are anticipating a continuation of the
uncertain trading conditions during the second half of the year. However,
prices have been firm in the market in which we operate and the Board is
confident in the continuing global demand for the finest antiques.
George Magan, Chairman
To view financials: http://bankrupt.com/misc/MALLET_PLC.htm
CONTACT: MALLETT PLC
Lanto Synge Chief Executive
Phone: 020 7499 7411
REGUS PLC: Slump in Sales May Force Firm into Bankruptcy
--------------------------------------------------------
Regus Plc has warned in its annual report filed with the U.S. Securities and
Exchange Commission that it may be forced to file for bankruptcy if its
sales continue to sag, according to the Observer.
"Unless our business outside the U.K. improves, particularly in the U.S.,
Germany and the Netherlands, we may be forced to seek protection for Regus
PLC under U.K. insolvency laws," the company said in the statement.
A spokesman for the company, however, said the warning only "refers to one
sentence in the risk factors in the 20-F (an annual report and accounts) of
July 15, which is standard legal documentation."
Regus' stock market value collapsed to GBP200 million from over GBP2 billion
in a matter of three years. In January, the company puts its U.S.
subsidiary into Chapter 11 bankruptcy. This was after it sold a 58% stake
in the U.K. arm to private equity firm Alchemy Partners.
Regus raised GBP25 million from the sale and used some of the proceeds to
provide emergency finance to sustain operations of its U.S. business.
TRINITY MIRROR: CEO Meets with Possible Bidder for Irish Titles
---------------------------------------------------------------
A weekend meeting between the chief executive of Trinity Mirror, Sly Bailey,
and Sir Anthony O'Reilly, owner of Independent News & Media, sparked new
rumors about possible buyers for the U.K. newspaper group's Northern Ireland
titles, according to the Financial Times.
Trinity Mirror is selling its regional papers in Northern Ireland as part of
its chief executive's strategic review when she took over management of the
company in February.
The Northern Irish division comprises the Derry Journal and Century Press &
Publishing businesses, which publish six titles in Northern Ireland and
three titles in the Republic of Ireland. Numis, the stockbroker, valued the
titles for sale, which include the Protestant Belfast Newsletter and the
Derry Journal group, at between GBP30 million and GBP40 million.
A consortium that included Candover and Apax Partners in September offered
450p for the titles. But Trinity Mirror said the valuation was too low in
comparison with the close to 400p trading value of the shares at that time.
Four months ago, private equity firm Candover lodged a second approach for
the publisher's national titles that includes the Daily Mirror, Daily Record
and Sunday People. But it, too, was rejected.
Possible buyers for the titles include SRH, Johnston Press, Gannett of the
U.S., and maybe a private equity firm, according to the report.
* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
Shareholders Total Working
Equity Assets Capital
Ticker (US$MM) (US$MM) (US$MM)
------ ----------- ------ --------
AUSTRIA
-------
Libro AG (111) 174 (182)
BELGIUM
-------
Real Software REAL (35) 244 (1)
CZECH REPUBLIC
--------------
Ceskomoravska Kolben &
Danek Praha Holding (89) 192 (2,186)
DENMARK
-------
Elite Shipping (28) 101 19
FRANCE
------
Banque Nationale
de Paris Guyane (41) 352 N.A
BSN Glasspack (102) 1,151 179
Bull SA BULP (760) 893 (130)
Compagnie
des Machines Bull (116) 136 (20)
Compagnie Francaise de
l'Afrique Occidentale (65) 256 21
Cofidur SA (5) 102 19
Dollfus-Mieg & Co. DOLP 0 187 28
European Computer System (110) 682 377
Financiere St. Fiacre (1) 111 33
Grande Paroisse SA (845) 383 107
Pneumatiques Kleber SA (34) 480 139
Sa des Usines Chausson (23) 249 35
SDR Picardie (135) 413 N.A.
Soderag (3) 404 N.A.
Sofal SA (305) 6,619 N.A.
Spie-Batignolles (16) 5,281 75
St Fiacre (FIN) (1) 111 (33)
Trouvay Cauvin TRCN 0 134 10
Usines Chauson (23) 249 35
GERMANY
-------
Dortmunder
Actien-Brauerei DABG (13) 118 (29)
Edel Music AG EDLG (66) 353 (159)
Eurobike AG EUBG (32) 158 (31)
F.A. Guenther & Sohn AG GUSG (8) 111 N.A.
Kaufring AG KAUG (19) 151 (51)
Nordsee AG (8) 195 (31)
Schaltbau AG SLTG (16) 163 20
Vereinigter
Baubeschlag-Handel
Holding AG VBHG (24) 307 (63)
ITALY
-----
Binda SpA BND (11) 129 (20)
CIRIO FINANZIARI CBDI (422) 1,583 (396) Credito
Fondiario
e Industriale SpA CRF (200) 4,218 N.A.
NETHERLANDS
-----------
Baan Company N.V. BAAN (8) 610 46
NORWAY
------
Pan Fish ASA PAN (117) 806 259
Petroleum-Geo Services PGO (32) 2,963 5,250
POLAND
------
Animex SA (1) 108 (86)
Exbud Skanska SA EXBUF (9) 315 (330)
SPAIN
-----
Altos Hornos de Vizcaya SA (116) 1,283 (278)
Santana Motor SA (46) 223 41
Tableros de Fibras SA TFI (43) (2,107) 116
SWITZERLAND
-----------
Kaba Holding AG KABZN (64) 515 252
UNITED KINGDOM
--------------
Abbot Mead Vickers (2) 168 (16)
Alldays Plc ALD (120) 252 (202)
Amey Plc AMY (49) 932 (47)
Bonded Coach
Holiday Group Plc (6) 188 (44)
Blenheim Group (153) 198 (34)
Booker Plc BKRUY (60) 1,298 (8)
Bradstock Group BDK (2) 269 5
Brent Walker Group (1,774) 867 (1,157)
British Energy BGY (5,342) 3,438 229
British Nuclear Fuels Plc (2,627) 36,359 1,948
British Sky Broadcasting BSY (459) 3,364 (40)
Compass Group CPG (668) 2,972 (298)
Costain Group COST (34) 329 (12)
Dawson Holdings DWSN (32) 135 (25)
Easynet Group Plc ESY (12) 332 53
Electrical and Music EMI
Industries Group (885) 3,053 (435)
Euromoney Institutional ERM (119) 173 20
Gallaher Group GLH (543) 5,527 68
Gartland Whalley (11) 145 (8)
Global Green Tech Group (156) 408 (18)
Heath Lambert
Fenchurch Group PLC (10) 4,109 (10)
HMV Group PLC HMV (606) 664 (133)
Imperial Tobacco Group ITY (117) 10,083 (190)
Intertek Testing Services ITRK (134) 425 (67)
IPC Media Ltd. (685) 254 16
Lambert Fenchurch Group (1) 1,827 (3)
Lattice Group (1,290) 12,410 (1,228)
Misys PLC MSY (86) 961 (7)
Orange PLC ORNGF (594) 2,902 7
Regus PLC RGU (46) 367 (60)
Rentokil Initial Plc RTO (1,130) 2,809 (37)
Saatchi & Saatchi SSI (119) 705 (41) Seton
Healthcare (11) 157 (0)
Yell Group PLC (196) 3,964 289
Each Tuesday edition of the TCR-Europe contains a list of companies with
insolvent balance sheets based on the latest publicly available balance
sheet available to our editors at the time of publication. At first glance,
this list may look like the definitive compilation of stocks that are ideal
to sell short. Don't be fooled. Assets, for example, reported at
historical cost net of depreciation may understate the true value of a
firm's assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which equity
securities trade in public market are determined by more than a balance
sheet solvency test.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter -- Europe is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc.,
Washington, DC USA. Larri-Nil Veloso, Ma. Cristina Canson, and Laedevee
Gonzales, Editors.
Copyright 2003. All rights reserved. ISSN 1529-2754.
This material is copyrighted and any commercial use, resale or publication
in any form (including e-mail forwarding, electronic re-mailing and
photocopying) is strictly prohibited without prior written permission of the
publishers.
Information contained herein is obtained from sources believed to be
reliable, but is not guaranteed.
The TCR Europe subscription rate is US$575 per half-year, delivered via
e-mail. Additional e-mail subscriptions for members of the same firm for
the term of the initial subscription or balance thereof are US$25 each. For
subscription information, contact Christopher Beard at 240/629-3300.
* * * End of Transmission * * *