LEP set to float off part of US security business

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The Independent Online
LEP Group, the heavily indebted freight forwarder, is considering floating off part of its US electronic security business on the New York Stock Exchange.

David James, LEP's chairman and chief executive, said National Guardian might seek a partial placing of its shares within the next year.

The business had considerable growth prospects, and had been given a substantial boost by the bombing of the World Trade Centre.

Mr James said: 'We don't intend to sell it as a trade sale. Quite frankly, we think we can do better than that.'

National Guardian increased its operating profit from pounds 13m to pounds 19.9m last year on turnover up from pounds 100.2m to pounds 127.9m. Although the results benefited from a stronger dollar, Mr James said filling gaps in National Guardian's network had also helped.

Mr James was also pleased that in a difficult year for worldwide trade LEP's freight-forwarding business, which provides most of the group's pounds 1.4bn turnover, had returned to an operating profit of pounds 5.5m. The previous year's loss of pounds 2.7m reflected pounds 7m of reorganisation costs.

The pounds 37.3m of interest payable on LEP's pounds 410m debt burden left the group with a pre-tax loss of pounds 15.6m, although this was an improvement on the previous loss of pounds 38.3m.

'It's going as well as it could,' Mr James said, while repeating his warning that LEP would not be able to pay a dividend in the future.

LEP's pounds 89m sale in January of its long-term leasehold in Swiss Bank House, the London home of Swiss Bank Corporation, will reduce its debt to about pounds 320m. Mr James said the group had to aim to increase its profitability to meet its interest burden.

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