Calibre sale processes and trading update

Calibre sale processes and trading update

Calibre Group Limited ("The Company") provides an update today on the current trading performance of the business and the sale processes it has been conducting in respect of each of its businesses, Professional Services (PS), Diona and G&S Engineering.

As announced on 11 May 2018, the Company has continued its negotiations with the consortium to acquire the PS and Diona businesses.  Negotiations are close to completion with a focus on finalising key terms between now and 30 June 2018.  

The Company is also working exclusively with another party to acquire the G&S Engineering business.  That party is currently conducting its final due diligence in relation to this business with a focus also on finalising key terms before 30 June 2018.  

It is anticipated that if terms are agreed completion of both sales will occur in July 2018. As a result of this timing and the requirement to classify the businesses as available for sale in June 2018, the Company’s initial assessments are that the Company will be required to reduce the carrying value of goodwill of the PS business with a non-cash impairment charge of between $20m and $40m.  This goodwill impairment charge will be included in the Company’s 30 June 2018 full year accounts. Any realised gain on sale of the Diona and G&S businesses will be recorded upon completion, and is anticipated to be between $12m and $27m.

The 2018 goodwill impairment charge is a non-cash item that has no impact on the Company’s banking covenants or underlying operating results. The Company will also be required to fully include in the 30 June 2018 full year accounts a charge for the advisory, retention and transaction costs of $7m-$8m associated with these disposals.  A component of these costs are contingent upon completion of the transaction with net proceeds disclosed once known.
Calibre continues to see positive growth in its revenues year on year, particularly in our utilities services business Diona under our Construction and Maintenance segment.  A constrained capital environment and pressure on margins in a highly competitive environment has impacted on margins.  

Based on the Company’s unaudited management trading results to May 2018, Calibre expects its underlying EBITDA (before abnormal items, retention and transaction costs) for the full year to 30 June 2018 to be approximately 20% to 30% below last financial year’s underlying EBITDA. Underlying results excludes current anticipated costs and outcomes from the sale processes as well as anticipated losses recorded in delivering the Mt Pleasant EPC project through our joint venture, of approximately $7-$8m our share.  

The Company will finalise its 30 June 2018 audited financial statements and will release these to shareholders by 30 September 2018.  

The Company expects to provide a further update to shareholders in relation to the outcome of the sale negotiations and the likely impact to the accounts once terms are agreed.



Craig Allen, Calibre Group Limited | +61 422 009 143 

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