Daisy's COO uproots

Gareth Kirkwood, the Chief Operating Officer of business communications services provider Daisy Group, has quit the board with immediate effect.

Kirkwood will leave the group at the end of the month to pursue other interests. His duties will be assumed by Daisy's Chief Executive Officer, Matthew Riley.

The departure was announced along with the group's pre-close statement which revealed that profit and earnings for the year ending March 2012 are expected to be within the range of market forecasts.

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The acquisitive company, which also announced the £28m purchase of audio-conferencing specialist Worldwide Group Holdings, said its focus in the year just ended shifted to integrating the companies it has purchased in the last 18 months, and declared itself pleased with its progress in this area.

The group's Retail division made progress with its mobile and data product portfolios which partially offset the expected tail-off in fixed line call revenues. The division has seen a "moderate lengthening" of sales cycles for some larger contracts, particularly in systems and large data installations.

The Wholesale and Distribution Divisions have benefited from the availability of a wider product set and have seen an improvement in cross selling trends among much of their product portfolios.

The chance to cross-sell was one of the reasons why the group bought Worldwide Group Holdings, which has a complementary product set to Daisy, including data connectivity, inbound-telephony, international toll-free services, maintenance services and disaster recovery.

In the 12 month period ending December 31st 2011, the unaudited adjusted management accounts of Worldwide included revenues and earnings before interest, tax, depreciation and amortisation of £36.4m and £4.0m respectively.

Daisy said the purchase price of Worldwide may increase, depending on the performance of the acquired business. Worldwide's existing senior management will be staying with the company.

The acquisition will be funded from an increase in existing borrowing facilities together with the addition of Royal Bank of Scotland to the existing four strong group of lenders.

Daisy's net debt at March 31st 2012 will be above March 2011 levels, the group advised. This reflects acquisition and integration cash flows, together with an increase in working capital absorption associated with its mobile business and a higher proportion of larger customer deals.

"For the year ahead, the board is pleased with the progress to date across all key divisions, though remains mindful of the challenging market trends and macroeconomic outlook," the company statement said.

JH