Iceland thaws out its ailing business

The company, which was re-named last week, said its expenditure plans would be funded with an internally generated cash flow, a sale and leaseback transaction and debt from bank and capital markets, without recourse to shareholders.

It said exceptional costs for 2002-2003 would be about £20m, including £7m of operating costs relating principally the creation of an integrated finance function centred in Deeside.

It expects the profit return on its investment to be about 17% by the 2004-2005 financial year.

Chief executive Bill Grimsey called on shareholders to judge the business from today, as it enters the third phase of its restructuring plan.

He said: ‘The key message is that in this recovery process, which we’ve always said would take three to four years, the first year was going to be spent on planning, building teams and building financial strategies. That is now complete.’

Grimsey and his finance director Bill Hoskins are known for turning around troubled businesses. Previously, they successfully restructured home improvement specialist Wickes.

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