Dentressangle cautious

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Norbert Dentressangle says it expects that full-year performance will be hampered by the deterioration in the business environment in the final quarter of 2008.

The international situation will slow efforts to improve the performance of the former Christian Salvesen business units and, in particular, the turnaround of the United Kingdom transport business which is currently undergoing restructuring.

It expects full-year like-for-like revenue to increase five  per cent on 2007 proforma revenue (€3.083 billion) and recurrent operating income to be slightly lower than the 2007 proforma figure of €91 million.

The group reported sales growth of 81 per cent, including the integration of Christian Salvesen, for the first nine months of 2008.
Sales for the logistics division grew by 113 per cent and accounted for 43 per cent of total revenue. Sales for the transport division grew by 63 per cent overall, and by 5.7 per cent in the historic consolidation scope. The slower pace of revenue growth observed since June 30th was attributable the Group’s decision to reduce its vehicle fleet ahead of the  expected slowdown in economic activity.

This trend was further accentuated by the decrease in fuel costs.

Organic revenue growth was consistent across the group, with a 6.5 per cent increase  for the historic consolidation scope and a 6.4 per cent increase  for Christian Salvesen businesses.

The group’s strategy is to focus on operating warehouse space under lease agreements, and four distribution sites were divested in the third quarter, generating approximately €20 million in net proceeds before tax. The sale, which aims to enable the Group to achieve higher flexibility and leaner operations, also allowed it to reduce net debt by €45 million, thus leading to a 12 per cent reduction in the estimated debt-to-equity ratio at September 30th 2008.

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