Press Releases

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2004 Press Releases

Keller Group plc (“Keller” or “the Group”), the international ground engineering specialist, is today announcing a trading update for the six months ending 30 June 2004, in advance of its Annual General Meeting, to be held tomorrow and prior to hosting a presentation for analysts later today.

As indicated at the time of the announcement of Keller’s 2003 results in March 2004, the current year started somewhat slowly, although trading has improved in the second quarter.

The Board expects the Group’s overall performance for the half year to be in line with its expectations at the time of the 2003 preliminary results announcement. As expected, the results will reflect a net adverse impact from exchange rate fluctuations of around £1m.

The current order book remains good, representing around four months’ sales. As previously indicated, the results for the full year are likely to be more second-half weighted than in 2003, consistent with earlier years.

Divisional review

In the US, Case and McKinney have both had a good first half and are well placed for the remainder of the year. Hayward Baker started the year more slowly, although activity and orders have picked up in the second quarter. Suncoast successfully implemented price increases in the first quarter, which, together with significantly increased volumes and operating cost efficiencies, have combined to restore margins.

The Continental Europe & Overseas business generally has had another good half year, despite continued weakness in Germany, and in Portugal where actions have been taken to reduce costs. In Spain, Keller-Terra has reported another strong performance, whilst operations in Austria, Italy and Poland have all contributed good results. The Middle East and Far East have performed satisfactorily, with good productivity on the Dubai Palm Island contract and another strong contribution from Malaysia.

In the UK, the result of Makers has been affected by losses on a small number of old contracts in discontinued areas, which are in the process of being run off. However, the underlying performance of the business has improved in the second quarter and the Board continues to expect Makers to return to profitability during the course of 2004. Keller Ground Engineering is expected to contribute a half-year result broadly in line with last year.

The Group’s Australian businesses have performed well and further progress has been made in developing the ground engineering subsidiary established last year.

Keller intends to announce its interim results on 23 August 2004.

Commenting on the half-year trading update, Justin Atkinson, Chief Executive of Keller, said:

“The Board expects the Group’s overall performance for the half year to be in line with its expectations at the time of the 2003 preliminary results announcement.

“The current order book remains good, representing around four months’ sales. As previously indicated, the results for the full year are likely to be more second-half weighted than in 2003, consistent with earlier years.”

For further information, please contact:

Keller Group plc
Justin Atkinson, Chief Executive	020 8341 6424
James Hind, Finance Director
Smithfield
Reg Hoare/ Anna Rainbow	020 7390 4600

Visit the new Keller website at www.keller.co.uk