LogicaCMG first half profit and revenue up; names David Tyler chairman

Source: LogicaCMG plc

For the six months ended 30 June 2007, LogicaCMG plc financial results were as follows, with comparatives on a restated basis for 2006:

Continuing operations
  • Revenue up 36.2% at £1,525.3 million (2006: £1,120.1 million)
  • Operating profit up 13.1% at £43.9 million (2006: £38.8 million)
  • Profit before tax of £29.2 million (2006: £26.8 million)
  • Basic earnings per share, including exceptional items and amortisation of acquisition related intangibles, of 1.8p (2006: 0.6p)
  • Cash conversion of 44% (2006: (1%)), based on net cash inflow from trading operations of £39.8 million (2006: £0.8 million outflow)

  • Profit from discontinued operations at £122.0 million (2006: £1.4 million)
  • Net profit at £149.4 million (2006: £10.3 million)
  • Net debt at 30 June 2007 of £399.1 million (31 December 2006: £557.1 million)
  • Interim dividend up 4.5% at 2.3p (2006: 2.2p)

    Summary operational results
    For the six months ended 30 June 2007, LogicaCMG plc results were as follows, with comparatives on a pro forma constant currency basis for 2006:
  • Revenue up 3.5% on a pro forma basis to £1,525.3 million (2006: £1,474.3 million)
    • Revenue growth above the market in France, Nordics, Netherlands and Germany partly offset by an 8.3% decline in UK revenue due to weakness in commercial sectors

  • Adjusted operating profit down 17.1% on a pro forma basis to £89.7 million (2006: £108.2 million)
    • Declines in the UK and International businesses partly offset by higher adjusted operating profit in the Netherlands and Germany
    • Most significant contributor to decline in profit and margin was a £13.6 million write-off on a previously disclosed UK project cost overrun
    • Adjusted operating margin at 5.9% (2006: 7.3%), with strong performance in Germany delivering an adjusted operating margin of 3.6% (2006: 7.2%)

  • Adjusted basic EPS from continuing operations up 11.1% at 4.0p (2006 actual: 3.6p)
    • Improvements in the tax rate to 18% offset lower UK profitability

    Update on Board changes
  • David Tyler to become Chairman on retirement of Cor Stutterheim
  • Progress being made in the search for a new Chief Executive

    Commenting on current trading, Jim McKenna, Chief Operating Officer, said: "Our outlook on the market remains unchanged, with healthy demand in our major markets.

    "A key priority for the second half is improving the operational performance in the UK. We will also be working on recruiting the right people in the right places to grow the business and on expanding the use of common systems and processes throughout the larger group."

    Commenting on the Board changes announced today, Cor Stutterheim, Chairman, said: "I am delighted that we have been able to secure my succession with the appointment of David Tyler. David brings a wealth of experience, which will be invaluable to the Board.

    "I would like to express my gratitude to George Loudon, on behalf of the Board, for his very important contribution to the business. George leaves at the end of nine years of service, over the course of which he has provided extremely valuable strategic insight and business advice as LogicaCMG transformed itself into a leading European IT services player.

    "It has been a great pleasure chairing the Board of LogicaCMG over the last five years. I believe that we have built a strong platform for future growth and I wish the group well in the next phase of its development."

    Commenting on the Board changes announced today, David Tyler, joint Deputy Chairman, said: "I want to express, on behalf of the Board, our sincere thanks to Cor Stutterheim. Cor has had an outstanding career in the IT services industry. He was the driving force behind the very successful development of CMG from its early days in 1970 to its merger with Logica five years ago. As Chairman of LogicaCMG, he has helped to guide the company through a period of rapid expansion. The Board thanks him very much for his long-standing commitment and contribution to the company and wishes him well for the future.

    "The Board is pleased with the progress being made in the search for a new Chief Executive; we remain focused on securing the best possible candidate to take LogicaCMG forward."

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