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UPDATE 1-Connect Group sees return to growth in 2018; to cut jobs
October 26, 2017 / 7:29 AM / a month ago

UPDATE 1-Connect Group sees return to growth in 2018; to cut jobs

(Adds shares, CEO comment)

Oct 26 (Reuters) - Connect Group Plc, a newspaper distributor and parcel delivery company, on Thursday said it expected to return to growth in 2018 as it restructures its core units.

The company’s shares jumped as much as 12.4 percent, before paring losses to trade up 7 percent at 98 pence per share by 0710 GMT on the London Stock Exchange.

“We are moving at pace with a transformation programme, to deliver a combination of efficiencies, service and organic sales that will underpin growth,” Chief Executive Mark Cashmore said in a statement.

The company sold its education and care unit to RM Plc for 56.5 million pounds ($74.82 million) in cash, pushing its net debt down to 82.1 million pounds from 141.7 million pounds at the start of the year.

The company also said it would cut 340 jobs, about 6 percent of its workforce, in 2018 as it looks to integrate its businesses.

Connect reported a 3.1 percent fall in full-year adjusted revenue to 1.59 billion pounds ($2.11 billion). Adjusted pretax profit for the year fell 4.6 percent to 48 million pounds.

The company also issued a 3.1 percent higher final dividend of 6.7 pence, taking the full-year dividend to 9.8 pence, a rise of 3.2 percent.

$1 = 0.7552 pounds Reporting by Sanjeeban Sarkar in Bengaluru; Editing by Sunil Nair

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