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Helphire continues to downsize and cut its debt

Accident management group Helphire saw its business reduce by almost a fifth in Q1 compared to the period last year.

The heavily indebted company has been restructuring since last year to focus on fewer but more profitable credit hire cases.

By the end of Q1 group debt had been reduced to £192m from the £212.1m owed at the end of 2009.

Its trading statement to investors today also reported "good progress" of its Project Century initiative to reduce operating working capital by £100m before June 2010. So far a reduction of £98.8m has been achieved.

In Q1 case volumes were 18.4% down on Q1 2009 "in line with expectations".

Average hire length actually increased 11.9% to 24 days, but Helphire puts this down to the impact of the severe winter weather on bodyshop repair cycle times.

Continued action on overheads saw a saving of £9.6m against Q1 2009.

Martin Ward, group managing director, said: "The benefits from the restructuring plan are self evident and the group continues to make solid progress. Working capital has been substantially reduced, debt levels continue to fall and utilisation is at an all time high.

"The number of case closures is increasing and we are encouraged by the better dialogue we now have with insurers.

"We renewed all significant key accounts as they have fallen due with the exception of one where the proposed terms were unprofitable. This business has since been replaced and there is no impact to our expected results. The new protocols with some insurers are still at an early stage but proving effective."


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