ferret's stock to watch: corporate express ltd

Ferret's Stock to Watch: CORPORATE EXPRESS LIMITED
07:27, Friday, 11 February 2005

COMPANY POSTS RECORD PROFIT AFTER $1 BILLION SALES MILESTONE


Sydney - Friday - February 11: (RWE Australian Business News)
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OVERVIEW:
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Investors have warmed to Corporate Express this week reflected by
a significant increase in turnover.

More than 2.7 million shares have changed hands against a total
of 6.9 million for the previous full month.

Obviously some traders had been expecting a good result for the
full year to December 31 which duly arrived on Wednesday.

In addition a good booster to market interest was the news that
the company is considering a $50 million off-market share buyback after
lifting profit 27 per cent to a record $58.2 million for the year.

A buyback helps the value of an individual share.

What stood out in the latest results though, was that Corporate
Express reached the $1 billion Milestone in revenue which jumped 14.7 per
cent on the previous year.

Ferret was happy in the thought he director trader interest
towards the stock almost a year ago when the share price was $4.63.

SHARE PRICE MOVEMENTS
*********************

Shares of Corporate yesterday edged up 1c to $6.21. Rolling year
high has been $6.40 and the low $4.28. Dividend is 15 cents a share to
yield 2.42 per cent.

Other highlights of the company's results included earnings per
share of 30.4 cents, up 26.7 per cent on 2003 at 24 cents.

* EBITDA up 22.8 per cent to $99.9million

* Acquired seven new businesses with annualised revenue of
$60million Australia's leading single source distributor of office and
business supplies.

* Directors declared a final fully franked dividend of 8 cents
per share (2003: 8 cents), taking the total payout for the year to 15c a
share.

* The Board is currently assessing capital management initiatives
to reward shareholders, including an off-market share buyback in the
order of $50 million which will be announced as soon as the final
decision is made.

MD chuffed by performance
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Corporate Express' managing director Mr Grant Harrod said: "We
are very encouraged by our strong profit performance.

"This has been achieved by increasing market share across all
businesses, broadening our product range, and the growing take-up of the
company's single source model by our customers.

"Revenue of over $1 billion is a milestone for Corporate Express,
and almost double the revenue generated four years ago.

"The performance of Corporate Express New Zealand has been
strong, with sales revenue increasing by 17.6% to $74.1million (2003:
$63.0 million) and earnings before tax up $1.4million to $5.1million, an
increase of 37.8 per cent.

"Acquisitions are a growth driver for Corporate Express.

"During the year we acquired seven businesses in the areas of
office supply, IT software license management, promotional products
and janitorial supplies, with annualised revenues totalling $60million.

"The company will continue to make bolt-on acquisitions that
complement existing operations," Mr Harrod said.

A significant change on the board was announced in December after
chairman John Turner decided to step down at the end of the month.

Mr Ian Pollard, a current independent non-executive director, has
assumed the chairman's role following Mr Turner's departure.

The Board has appointed current chief financial officer,
Grant Logan, to the board

He has had extensive business and financial experience, and has
held senior executive positions with a number of international, private
and publicly listed companies.

Meanwhile the warehouse management system, implemented in the
Sydney distribution facility in 2003, has given the company the
flexibility to distribute increased volumes of product that would not
have been possible using the previous system.

This system will be installed in the Melbourne facility
later in the year.

Corporate Express now services over 45,000 business and
government customers throughout Australia and New Zealand.

In order to broaden existing customer relationships and deliver
the highest levels of service, the company has strengthened its
management team by appointing a new general manager, marketing, and a
dedicated customer care manager.

Company outlook
***************

"Market conditions are currently stable and our performance to
date is in line with management's expectations, managing director Harrod
said.

"Corporate Express will in future report on a quarterly basis in
line with majority shareholder Buhrmann, which will keep the market
informed of the company's performance.

"The company's single source model is a significant driver of
shareholder value, as witnessed by our revenue and profit growth in 2004.

"We expect greater uptake by customers as we add new
single source specialty divisions to our existing model.

"Corporate Express remains committed to growth and actively
pursues opportunities both organically and through acquisitions that make
a positive contribution to earnings.

"Expansion of our specialty divisions remains a priority and
there is opportunity for further consolidation in these lines
of business, Mr Harrod declared.

BACKGROUND
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Corporate Express Australia Ltd is one of Australia & New
Zealand's leading suppliers of business essentials.

The company now operates from 49 branches throughout Australia
and New Zealand, servicing large, medium and small customers providing a
single source supply solution for all purchases of office and business
supplies.

The Corporate Express strategy is to enable customers to
outsource all the products and services required for the office, by
helping them simplify their procurement process and reducing their costs
of doing business.

Customers expectations are for a single source for all business
essentials; next business day delivery - nationwide; complete & accurate
deliveries; prompt & courteous customer support; pro-active account
management; accurate and timely billing and innovative ordering
solutions.

Corporate Express' single source business model, proprietary
technology and supply chain management systems enable its customers to
re-focus key personnel and eliminate inefficient processes, therefore
lowering their total costs of doing business.

The company points out that the supply of Business Essentials is
for most businesses a necessary operating expense, involving hidden and
redundant fixed costs in people, systems, storage space, inventory and
distribution.

Corporate Express says the Total Cost Management (TCM) program
eliminates these costs by outsourcing the procurement supply chain,
allowing the purchase only what's needed, when required and using systems
to manage the entire process.

It covers office & computer supplies, IT solutions, business
furniture, liquor, coffee & kitchen supplies, print services, promotional
merketing, janitorial supplies and national distribution.

ENDS