Eleco Sees FY Loss On Low Trading In Building Systems Unit

28th Jul 2010 07:53

LONDON (Dow Jones)--Eleco PLC (ELCO.LN), a provider of Building Systems and Software to the construction industry, said Wednesday that as a result of losses from its Building Systems unit, it anticipates a loss before non-recurring items and reorganization costs is expected to be significantly worse than anticipated, for the year ended June 30. MAIN FACTS: -Anticipates that markedly improved profits from its Software operations will be more than offset by significantly greater than anticipated losses from its Building Systems operations, in particular from the precast concrete and timber frame businesses. -Also anticipates that the Group loss after non-recurring items and reorganization costs but before interest, tax and amortization will be in line with expectations. -Group net bank indebtedness at 30 June 2010 was marginally lower at GBP1.9 million, compared with net bank indebtedness at Dec. 31, 2009 of GBP2.1 million. -Group's Software operations continued to grow through the judicious expansion of its core software offerings and the reduction or removal of loss-making businesses. -In the U.K., Sweden and Germany it has benefited from modestly improving markets. -The Software Division is expected to report a marked improvement in its profitability in the year just ended. -The annual run rate of Central Group costs has been reduced by approximately GBP0.9 million through salary reductions, reduced headcount and other cost savings -The Company estimates that on an annualized basis Eleco has reduced its costs by more than GBP4.0 million in the year ended June 30 compared with the prior year. -The Group will continue to implement cost reductions wherever possible to eliminate losses whilst also seeking to grow its profitable businesses. -Shares closed Tuesday at 21.5 pence. By Iain Packham, Dow Jones Newswires; 44-20-7842-9269; [email protected] (END) Dow Jones Newswires July 28, 2010 02:53 ET (06:53 GMT)