Sponge Bob schreef:
• Getronics launched EUR 95 million Senior Unsecured Convertible Bonds due 2014 and launched a successful Tender Offer for the 2008 Bonds, significantly improving the maturity profile of the Company’s balance sheet and reducing the Company’s cost of capital.
Impairment of Goodwill
As part of its annual accounting procedures, the Company has tested the goodwill of its various cash-generating units. The testing carried out this year was based on more conservative outlooks than the current business plans suggest, taking into account supporting historical evidence. As a result, the Company has today concluded that it will recognise an impairment charge of EUR 65 million with respect to its US, Belgian and UK operations.
Outlook
The level of contracted revenue and the quality of the commercial pipeline at the start of 2007 supports an improved organic service revenue growth. This growth will be driven by demand in workspace management, including the Future-Ready Workspace, security and transformation services. Although service revenue is important to our long-term success, the primary focus in 2007 will be on margin improvement and cash generation.
In 2007, Getronics expects to see a margin improvement as a result of profitable organic growth and the Breakout Programme. Management is working towards an EBITAE range of between 4.0% and 4.5%, excluding one-off items. Getronics, as previously stated at the Extraodinary General Meeting of Shareholders on 1 December 2006, re-confirms its EBITAE margin target of at least 5% to be achieved by the end of 2008.
Page 5 of 7
Page 6 of 7
Amsterdam, 27 February 2007
In addition, the Company will no longer issue revenue targets, as this is less relevant in the context of its focused strategy. As a result of this and following significant divestments executed, the previously communicated strategic target of EUR 4 billion in total revenue by the end of 2008 no longer applies.
Also in 2007, Getronics may incur employee benefit plan related gains or losses as the Company looks to further reduce its exposure to such plans. Any such gains or losses may have material effects on the Company’s operating results.
The Company will also continue to focus on its cash management programme, aiming to generate positive cash flows to support the target Debt/EBITDA ratio of 2 or less by the end of 2008.
The Company is well positioned to successfully execute on its recently communicated strategy. The Board of Management feels confident that the Company will generate an operational performance in line with the outlook. By meeting its outlook, the Company expects to achieve a net profit in 2007, barring unforeseen circumstances.
Dividend
Taking into account that a net loss has been recorded in 2006, the Company will propose that no dividend be paid to the shareholders over the year 2006.
Additional disclosure
The Company’s unaudited operational and financial review (OFR) will be provided on 1 March 2007 as planned. Also, the Company will provide a presentation to media and financial analysts on Thursday 1 March. All presentations will be made available on the company’s website, including audio/video webcasts.
Thursday 1 March
Media meeting 10.00CET Audio webcast
Analyst meeting 12.30CET Video webcast