Telent Reports Full Year

Telent reports revenues of £309M for the year ended March 31, down from £312M the previous year

May 16, 2007

3 Min Read

LONDON -- telent plc (LSE: TLNT) today announced results for the financial year ended 31 March 2007.

Summary Financials

Table 1: Year ended 31 March

� million

2007

2006

Revenue from Trading Activities1

309

312

Adjusted operating profit2 from Trading Activities

24

27

Exceptional items, liability management and share option costs

(9)

4

Operating profit from Continuing Operations

15

31

Profit before tax from Continuing Operations

40

58

Basic earnings per share (pence) from Continuing Operations

98.2

179.2

Basic earnings per share (pence) from Adjusted operating profit2 from Trading Activities

38.7

44.8

Company Cash (excluding UK Pension Plan Escrow Account)

235

249





Commenting on the results, John Devaney, Chairman said, "FY07 has been a successful first full year of operations for telent. Whilst Group results have been impacted by prior year business disposals and the expected decline in legacy System X revenues, the new executive team have delivered robust results in the ongoing Trading Activities and are proactively managing legacy liabilities. Initiation of a progressive dividend policy reflects the Board's confidence in the Group's future prospects."

Commenting on the results, Mark Plato, CEO said, "We have had an excellent second half of the year with revenues up 10% on the first half and ahead of our expectations. Although markets remain very competitive the combination of our in depth technical expertise, strong customer focus and vendor-independence are leading to solid organic growth. Our decision to announce a progressive dividend policy reflects our confidence about opportunities in our current markets and our belief that we can accelerate growth by expanding into closely related markets."

HIGHLIGHTS

  • Strong second half performance

    • Revenues £162 million, up 10% on first half; and compared to second half of previous year

    • Growth driven by Enterprise (up 19% on first half) with increased activity under contracts with the Highways Agency, Network Rail and O2 Airwave; Telco up 4% with additional volumes under Easynet frame contract

    • Midlands TechMAC contract with Highways Agency extended by 2 years (£5 million); significant new customer wins - first frame contract with Huawei for MSAN installation & commissioning services to support BT 21CN roll-out

    • Preferred supplier to EADS for 8-year, circa £29 million, FiReControl project

  • Good progress on legacy issues

    • £9 million legacy cash generation in second half, reducing full-year legacy cash spend to £50 million

    • Estimated up to £100 million net cash spend on legacy items over next five years

    • Disposal of German real-estate announced April 2007; cash proceeds £15 million

  • Cash balance £749 million (31 March 2006: £739 million)

    • Includes £514 million UK Pension Plan Escrow (31 March 2006: £490 million)

    • Further progress on releasing other restricted balances to £34 million (31 March 2006: £78 million)

  • UK Pension Plan

    • Neutral on an IAS19 accounting basis (31 March 2006: £6 million surplus)

  • Trading Outlook

    • Targeting high single digit organic annual sales growth over the medium-term

    • Actively pursuing new bids in emergency services, transportation and network operator transformation programmes

    • Opportunity to accelerate growth through bolt-on acquisitions to access new markets and service capabilities

    • Revenue growth expected to be main contributor to profitability improvements in medium-term

  • Adoption of a progressive dividend policy

    • Board recommends a total dividend of 11.0 pence per share for financial year ended 31 March 2007



telent plc (London: TLNT)

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