- Strategy & performance
In this section we give an overview of our performance in 2010, plus objectives and our outlook for 2011.
- Business review
Find out about how each of our businesses have performed this year, plus our outlook for each in 2011.
Business overview
For an at a glance overview of the performance of each of our businesses.
- Governance
Find out about how we govern the company, our remuneration policies, the director’s report and a statement of their responsibilities.
- Financials
Including consolidated statements, the auditor’s report, notes to the accounts and a five year summary.
- Shareholder
information
For useful share management and investor information, including key dates for the diary and contact information.
Annual General Meeting
Will be held on Wednesday 11 May 2011 at 11.00 am
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Page contents
Market conditions
Trading conditions in many of our markets in 2010 continued to be difficult, especially in the Benelux, and to a lesser extent in France and Austria. Competitor activity coupled with general price pressure were the main factors involved. There is, however, evidence that volumes have begun to slowly recover, with positive sentiments continuing in Germany in particular. This will enable the Textiles & Hygiene division to mitigate the impact of challenging market conditions.
| Fourth quarter | Full year | ||||||
|---|---|---|---|---|---|---|---|
| £m | 2010 | 2009 | Change | 2010 | 2009 | Change | |
|
At 2009 constant exchange rates: |
|||||||
| Revenue | 211.9 | 217.3 | (2.5%) | 847.0 | 859.6 | (1.5%) | |
| Adjusted operating profit (before amortisation and impairment of intangible assets1 and one-off items) | 30.9 | 38.2 | (19.1%) | 124.9 | 128.4 | (2.7%) | |
| At actual exchange rates: | |||||||
| Adjusted operating profit (before amortisation and impairment of intangible assets1 and one-off items) | 29.8 | 38.5 | (22.6%) | 120.7 | 128.4 | (6.0%) | |
1 Excluding computer software
Revenue fell 1.5%, an organic decline of 0.5% after adjusting for the disposals of the Spanish Textiles and Finnish Mats operations and acquisition of the Swedish dental reclamation business. While robust performances were recorded in Germany (up 2.6%), the Nordics, and the Medical and Hygiene business units, overall performance was impacted by challenging market conditions, in particular competitive pricing pressure in the Netherlands, Belgium and France. Revenue in the Netherlands declined by 7.6%, while France remained flat year on year, reflecting contract losses in Q1. The Medical business recorded strong organic growth of 12.3%.
Profit declined by 2.7%, an organic decline of 3.7% excluding acquisitions and disposals. All territories with the exception of the Benelux and Portugal grew profits year on year, reflecting the impact of new management, robust cost control and restructuring programmes. There was a significant profit decline in the Benelux, impacted by higher processing and distribution costs associated with the restructuring in Belgium and competitive pricing pressure. There were non-recurring items in the year in Benelux (negative) and in France (positive) with a net positive impact on profit of £2.3m.
2011 preview
The expectation for 2011 is that price pressure will continue albeit not at the same levels witnessed in 2010. Divisional initiatives are being launched across many areas including sales and service productivity improvement programmes. These will enable the Textiles & Hygiene division to mitigate the impact of challenging market conditions and inflation. Continued focus will remain on the cost base with cost saving programmes ongoing across all countries. The start of the year has been marked by the launch of the new Initial brand. This, coupled with the ongoing roll out of new customer propositions, should strengthen our market position in 2011. New leadership is in place in Benelux and a thorough business review is underway, the results of which will yield benefits in the course of the year.