nfk and hastie group, page-2

i can see NFK being taken over by Hastie group within 3 years at the most.

Norfolk is a leading provider of electrical, communications, HVAC (heating, ventilation and air conditioning), passive fire protection and property services and products in Australia and New Zealand.

With a network of highly successful and long-established companies, the group has an annual revenue of more than $A800 million and operates through three divisions, each comprising of a number of companies that are leaders in their fields.

Key Financials FY2008
Revenue A$829.4 million
EBIT A$33.0 million
EPS 15.0 cents
Price to earnings ratio 13.0x
Dividend per share 5.7 cents
Annualised dividend yield for FY2008 4.3%


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Norfolk launches Initial Public Offer
22 June 2007
The directors of Norfolk Group Limited today lodged a Prospectus with the Australian Securities and Investment Commission (ASIC) for its A$196.9 million initial public offer (IPO).

The offer consists of 100,945,892 million shares at a price of A$1.95 per share (Offer). This represents approximately 77.7% of Norfolk’s issued shares, implying a market capitalisation at listing of A$253.5 million. The company expects that normal trading of its shares will begin on the Australian Securities Exchange (ASX) on 27 July 2007.

Norfolk is a leading provider of electrical, communications, HVAC (heating, ventilation and air conditioning), passive fire protection and property services and products to more than 19,500 customers across Australia and New Zealand. Norfolk is the number one provider of electrical and HVAC maintenance services in Australia operating through widely recognised, established brands including O’Donnell Griffin and Haden.

Norfolk has 3,400 employees at more than 80 sites throughout Australia and New Zealand, including more than 1,750 highly skilled electricians, air conditioning technicians and engineers. Norfolk’s scale provides an advantage over smaller competitors as it is able to undertake and resource large, complex projects and provide trans-Tasman coverage to customers.

Norfolk has highly specialised capabilities in the high growth infrastructure market, including:
rail electrification; and
power generation and transmission.
In addition, Norfolk is strongly positioned to grow in other areas of specialised capabilities, including:
HVAC maintenance;
environmental HVAC; and
fire retardant products.
“With our broad geographic reach and integrated offering of a wide range of services and products, we have significant scale advantages over many of our competitors in the fragmented markets in which we operate. This scale has assisted us in establishing long term relationships with many high quality customers,’’ said Norfolk Chairman, Peter Abery. “The earnings stability this diversity provides is enhanced by our focus on the provision of recurring maintenance services to our customers.’’

The Norfolk businesses were acquired from Tyco in November 2004. Managing Director, Glenn Wallace and the management team of Norfolk have spent the past two and half years focused on building a strong operational platform from which to grow the business.

By embarking on an IPO and listing on ASX, Norfolk will have access to liquid capital markets that will support its growth strategies, including expansion, both organically and via bolt-on acquisitions, into new, innovative markets and selected international markets as well as to take advantage of strong demand in its existing markets.

“Investors in Norfolk will benefit from significant organic growth opportunities as well as additional upside from the execution of further bolt-on acquisitions and increasing demand for our services overseas. ’’ said Mr Wallace.

Norfolk is expected to continue to deliver strong revenue growth and margin expansion. Norfolk’s annual pro-forma revenue is forecast to be A$829.4 million in FY2008, supporting pro-forma EBIT of A$33.0 million. This represents growth in Norfolk’s pro forma EBIT margin from 3.3% in FY2006 to 4.0% in FY2008, with an EBIT compound annual growth rate of 21.6% over that period.

Existing shareholders and management will retain a 22.3% stake in Norfolk post IPO. An option scheme is also in place to align the interests of management with Norfolk’s performance.

Norfolk will raise approximately A$196.9 million from the Offer, based on the offer price of A$1.95 per share. The Offer is fully underwritten by the Joint Lead Managers, Goldman Sachs JBWere and ABN AMRO Rothschild.

The Offer of shares is made under the Prospectus and comprises an offer to employees, retail investors and Australian and international institutional investors. There is no general public offer.

Subject to certain conditions set out in the Prospectus, the directors intend to declare a fully franked dividend of 5.7 cents per share for the period from the listing date (expected to be 27 July 2007) to 31 March 2008 and pay any declared dividend in July 2008. This implies a dividend yield of 4.3% based on the offer price of $1.95 per share.