The CEO is leaving in August. It does not warrant a substancial slide in its share price today. This is good buying at these levels. Do your own research and you will find out the upside in this stock. See below MD's statement.
I bought early in Ted Narks tenure, CXP share price and market capitalisation have increased over 1600%, making it the best performing stock in the ASX 200 index during that period.
mycall101 I hold CXP
STATEMENT OF THE MANAGING DIRECTOR TO THE ANNUAL GENERAL MEETING TUESDAY 21 MAY 2002
I would like to welcome our shareholders and thank you for attending Corporate Express Australia's Annual General Meeting. I am pleased to report for the fourth consecutive year that Corporate Express Australia's share price has increased. Due to our consistent growth in revenue and profitability, the company's share price has grown over 1500% during the last four years, making it one of the best performing stocks in the ASX 200 index.
An increasing number of our customers are embracing our single source offering. In addition to our traditional office and computer supply business, Corporate Express now has specialty divisions providing furniture, print management, promotional marketing, IT solutions and coffee, catering and washroom products. These businesses collectively grew in excess of 30% in 2001, and that growth has accelerated during the first four months of this year.
The markets we address in our specialty businesses are fragmented and offer substantial growth opportunities. While we are already the largest business to business distributor in two of the five markets in which our specialty divisions operate, we have less than a 5% market share in each of these markets.
The Corporate Express Liquor division will be launched before mid year. We will continue to explore other areas where we can leverage ur logistics, systems and service capabilities to provide our customers a single source solution for the products and services they require to do business.
The company has developed a core competency in the acquisition and integration of companies who participate in the markets that we serve. Acquisitions will continue to be akey part of our growth strategy. We currently have letters of intent in place with two company's totaling approximately $18 million in annualised revenues. Due Diligence has been completed on these acquisitions, and they are expected to close in the first half of this year.
In addition, we are currently in discussion with acquisition candidates totaling an additional $35 million in annualised revenues. All acquisitions will be funded out of cashflow and are expected to be accretive to earnings.
We are committed to further enhancement of our IT and Logistics capabilities. We will be launching the third generation of our proprietary internet ordering system, NetXpress, in the third quarter of this year. We are pleased to report that in the first quarter of this year, for the first time in our history, over 50% of the orders we received were placed via e-commerce.
The company continues to invest in its logistics infrastructure. Upgraded Warehouse Automation Systems are scheduled to be implemented in NSW and Victoria early in the fourth quarter of this year. They are designed to further improve the quality of the service we offer our customers, and will significantly increase the productivity of our distribution centers. This will result in reduced operating costs in 2003 and beyond.
Our New Zealand business continues to deliver strong growth. Profitability increased 124% in 2001 and is currently trading ahead of our projections for this year.
The organisational changes we implemented earlier this year have been well received. Our management team is focused on consistent improvement in our service offering to our customers and continued strong growth in both revenues and profitability.
The company remains comfortable with its target of 15%-20% earnings growth for 2002 and is on track to exceed that objective in the first half of the year.
I would like to take this opportunity to express my appreciation to the management team, my fellow directors and all Corporate Express employees for their contribution to the company's performance over the last year. In addition, I would like to thank the shareholders for their continued support and investment in Corporate Express Australia.
MANAGEMENT CHANGE
The Board of Corporate Express Australia Limited (CXP) announced today that they have accepted with regret the resignation of Ted Nark, Managing Director.
Ted Nark joined the Company from Corporate Express in North America in April 1998. In his four years in Australia he has successfully developed a strong management team which has generated substantial organic growth, and executed 20 successful acquisitions in office products and related markets. During his tenure, the Company's share price and market capitalisation have increased over 1600%, making it the best performing stock in the ASX 200 index during that period. Corporate Express Australia is now positioned as the premier single source supplier of products and service for the office in Australia and New Zealand, with strong growth prospects going forward.
The Board of Corporate Express wishes to put on record its sincere appreciation to Ted Nark for his work during his period in Australia, and wish him success in his new career in the United States of America. He will remain as CEO of the Company until early August, by which time the Board expects to be able to announce his successor.
