Each year the Broadwalk Services Awards recognise outstanding achievements by quoted companies and their management teams in the broadly defined business services sectors. The sponsors are Broadwalk Asset Management that manages the Broadwalk Select Services Fund, Europe’s first absolute return fund to focus on the services sectors (the fund has risen almost 90% since its inception in June 2008). The business services sectors are one of the less well known success stories of the UK economy, and these awards are another step towards raising their profile.
This Year’s Winners
Here are the citations for each winner:
While the European macro environment has not been helpful, easyJet has done an outstanding job in winning market share by exploiting its wide European network, low cost advantage and strong financial position. CEO Carolyn McCall has laid out very clear targets to ensure the capital structure remains robust while also efficient.
Cost discipline is also very tight which will help mitigate uncontrollable increases in fuel, foreign exchange and airport charges.
The picture shows easyJet CEO Carolyn McCall receiving the firm’s award from Broadwalk founder Charlie Cottam.
Miles Roberts CEO and executive team, DS Smith
Roberts joined DS Smith as CEO in May 2010. Since then the company has been transformed. In 2010 corrugated packaging company Otor of France was bought for €247m. In 2011 Spicers the wholesaling business, was sold for 200m. In January the company announced the purchase of SCA Packaging for €1.6bn, partly funded by a skilfully handled 466m rights issue. DS Smith became the leading corrugated packaging company in Europe and was strongly earnings enhancing. In October Roberts and Finance
Director Steve Dryden announced the integration is ahead of expectations with higher synergies and a faster debt reduction schedule.
Sir Ian Wood, Chairman, Wood Group (retired November)
Sir Ian joined the business in 1964 and as Chief Executive since 1967 pioneered the group’s move into oil and gas engineering and support services as reserves were discovered in the North Sea in the 1970s. Sir Ian build a global energy services group with 42,000 employees in 50 countries. This included well integrated acquisitions of JP Kenny, Mustang and PSN, as well as the $2.8bn disposal of the well support business in 2011. CEO Allister Langlands has taken over as Chairman, with Bob Keiller becoming CEO.
Invensys sale of Rail to Siemens in November for £1.7bn
With a single transaction CEO Wayne Edmunds has effectively neutralised the pension fund issue and focused Invensys on its core industrial software and systems businesses. The price of 1.7bn was good representing 15x historic EBIT. After two 625m returns to shareholders and to the pension fund, it allows for 400m of bolt on acquisitions without going into debt. Invensys is now very well positioned to act as a consolidator in the fragmented industrial software market in particular.
DKSH CHF 903m raised in March at CHF48 Joint Global Coordinators: UBS, Deutsche Bank. Joint Bookrunners: Berenberg Bank, Credit Suisse.
Zurich based DKSH is the leading market expansion services group focused on Asia with over 24,000 staff and sales of CHF 7.1bn. It distributes products in the consumer goods, healthcare, performance material and technology sectors. Chairman Adrian Keller and CEO Dr.Joerg Wolle have overseen the doubling of net sales and the quadrupling of profits since the merger of two 150 year old Swiss trading houses in 2002. The maiden interim results as a listed company in the summer showed 16% growth in sales, and 24% rise in net profit.
Under founder Chairman Jeremy Pilkington and Managing Director Neil Stothard capital discipline has been impressive, with a tender for 7% of the outstanding share capital undertaken in February. The specialist focus on Vp’s rental fleet has enabled it to grow despite a continued difficult operating environment. Strong cash flow has continued to ensure a strong balance sheet that supports re-investment in the fleet, share buybacks and further bolt on acquisitions.
Chris Cole, CEO WSP Group (now Executive Chairman, GENIVAR)
Cole and his fellow partners founded WSP in 1969. He floated the company in 1972 with sales of 1.9m and 50 people. Through organic growth and well integrated acquisitions WSP grew to 9,000 employees in over 30 countries generating 717m of annual revenue. The company was particularly strong in high rise building, Rail, Bridges and the environmental sector. In June Canadian GENIVAR paid a 67% premium to WSP’s closing price with a 343m cash bid. The 435p per share bid represented around 13x current year earnings forecasts which was a very good price given the depressed stock market conditions.