FON Fonebak

RNS Number:4574K
Fonebak plc
21 December 2007



Friday 21st December 2007



                                  Fonebak plc



                             AGM Trading Statement



At the AGM of Fonebak plc, to be held at 12 noon today, Gary Stokes Chief
Executive, will make the following statement:


"In this my first Annual General Meeting since joining Fonebak earlier this year
I am pleased to report considerable progress and a strong start to the current
financial year.  2007 saw significant advances for the Group with first the
acquisition of CRC in January and then the subsequent restructuring of the core
Fonebak businesses following the profit warning in March.



Within the enlarged Group a total of eight facilities have been divested since
the restructuring programme started. We now have a better balance of capacity
built around centres of excellence in key locations across Europe. With the
first 'recovery' stage nearing completion the business is now clearly focused on
its core competencies in the repair, remarketing and recycling of commercial and
consumer based technology products.



Since we reported our full year results at the end of September the financial
performance of the Group has been ahead of our internal plan. The strong
performance in the first half of the year reflects the continued strength of our
repair operations and the improving position in our end-of-life asset management
activities now that the benefits of the recent restructuring are coming through.



Notwithstanding the significant progress made in the first half, the Board
expects the second half to be more challenging for our UK repair operations;
partly as a result of the pressures some of our clients are seeing in their own
markets. The Board, as a result, expects that the Group will exceed market
profit expectations for the first six months and remains confident of achieving
expectations for the full year.



As we enter the next stage of our development the Group will be investing in the
resources and infrastructure to support the future commercial expansion of the
business. This investment includes the marketing of a more integrated
value-added service model.



As part of our programme to communicate a clearer, more compelling message to
our stakeholders, we are also progressing plans to re-brand the Group.
Shareholders will shortly receive formal notice of our plans for a change of
name; currently it is our intention for the re-launch to take place in the first
quarter of 2008.



As a business we generate a healthy cash flow and our indebtedness continues to
reduce. Current indebtedness is significantly below the level reported at the
2007 year end, which partly reflects our improved trading but also the continued
drive to reduce our working capital. As a result, the business has sufficient
funds to finance the ongoing development plans.



Looking back over the last twelve months we can reflect on a period of much
progress set against difficult circumstances. It is too early to declare the
recovery complete; however, it is clear that the Group is in substantially
better health than it was, even a few short months ago. The foundations are now
in place from which to move forward and whilst the trading environment remains
tough there are clear opportunities for the Group to develop further. Progress
to date is positive and the Board remain optimistic about the future."



                                     -ENDS-



Enquiries


Fonebak
Gary Stokes                         Chief Executive                 01865 487235
David Kelham                        Chief Financial Officer         01865 487235

KBC Peel Hunt Ltd (Nominated Adviser and Broker)
Jonathan Marren                                                     020 7418 8900
Gordon Suggett                                                      020 7418 8900

Pelham (Financial PR)
Philip Dennis                                                       020 7743 6363




                      This information is provided by RNS
            The company news service from the London Stock Exchange
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