Business
Trading Update and Sale and Leaseback
Trading Update and Sale and Leaseback.
About this update from Smiths News Plc
[{"type":"text","content":"\n \nRNS Number : 7892I Connect Group PLC 13 August 2019 \n\nThis announcement contains inside information\n \n \n13 August 2019\n \nConnect Group PLC\n(\"the Company\" or \"the Group\")\n \n \nTrading Update and Sale and Leaseback\n \n \nTrading update \n \nSince the Group's interim financial results on 1 May 2019, overall trading is slightly below market expectations, with a strong performance in Smiths News partially offsetting a slower turnaround performance in Tuffnells, where H2 performance to date has improved on H1 2019 in line with guidance previously given.\n \nThe Company will publish its preliminary financial results on 6 November 2019. \n \nSale and Leaseback \n \nIn January 2019, the Group announced that as part of its capital allocation strategy it would take a more prudent and disciplined approach to capital management. An important aspect of this included a potential sale and leaseback of up to 16 freehold and long-lease properties within the Tuffnells estate. The process was expected to raise up to £35m of net proceeds before tax. Since then, the Group has undertaken a thorough tender process. However, due to the current market conditions and outlook, the proposals received did not meet the Board's expectations in respect of value, economic return and timings. Accordingly, it is unlikely that the Group will conclude such a deal before the end of its current financial year and, as a result, net debt is expected to remain flat on HY2019 (net debt at 28 February 2019 was £77.5m, representing a net debt/adjusted EBITDA ratio of 1.95x). The Group continues to target a reduced net debt/EBITDA ratio of 1x by FY2021, with repayment achieved through a combination of surplus free cash from operations as well as proceeds from any future sale and leaseback of Tuffnells properties as and when appropriate. \n \nEnquiries: \n \nConnect Group PLC \nJos Opdeweegh, Chief Executive Officer\nTony Grace, Chief Financial Officer \n01793 563641 \nwww.connectgroupplc.com \n \nBuchanan (Financial PR)\nRichard Oldworth / Jamie Hooper \[email protected] \nwww.buchanan.uk.com\n \n \nPerson responsible for arranging release of this announcement:\nStuart Marriner, General Counsel & Compan...