DX (Group) plc ("DX") is an independent mail, parcels and logistics end to end network operator in the UK and Ireland (Eire) established in 1975, delivering approximately 170 million items in 2013. DX provides next day delivery services for mail, parcels and 2-Man deliveries to business and residential addresses nationwide, for both public and private sector companies. In particular, DX specialises in next day or scheduled delivery of time sensitive, mission critical and high value items for B2B and B2C customers. In March 2012, DX acquired Nightfreight, subsequently named DX Freight, a specialist in the field of irregular dimension and weight freight in the UK B2B and B2C markets with over 7 million deliveries per annum.


IPO Date - 27/02/2014
DX.:LSE is traded on the London Stock Exchange Alternative Investment Market (Aim)

https://www.thedx.co.uk/

Preliminary Results

FINANCIAL

· Revenue of £291.9m (2016: £287.9m)

· EBITDA1 of £7.2m (2016: £18.0m)

· Adjusted2 profit before tax and exceptional items of £nil (2016: £11.5m)

· Exceptional (non-recurring) items of £80.7m (2016: £92.1 million) - includes goodwill impairment of £72.4m (2016: £88.4m) and other one-off items relating principally to property dilapidation provisions, restructuring and professional costs, and senior management departures

· Reported loss before tax of £82.3m (2016: £82.7m)

· Adjusted2 EPS of 0.1p (2016: 4.9p) / Reported loss per share of 40.3p (2016: LPS of 42.1p)

· Debt (net of cash) at 30 June 2017 of £19.1m (2016: £9.8m)

· New financing agreement - see below

1 Earnings before interest, depreciation, amortisation and exceptional items

2 Adjusted profit before tax and adjusted EPS exclude amortisation of 'other intangibles' and exceptional items.



OPERATIONAL

· Focus on addressing operational and financial underperformance with a wide-ranging review of the Group's operations

· Attrition at DX Exchange declined year-on-year and was within expected levels

· Overall new business was 20% higher year-on-year

o major new contracts signed with Avon and IKEA3

· Successfully retained contract with the Home Office

· Industry wide shortage of CPC-qualified drivers remains a pressure

o mitigating initiatives continue

3 Additional IKEA revenue was won in the year and a major new contract was signed in September 2017



POST PERIOD

· New leadership team appointed - Ron Series as Chairman and Lloyd Dunn as CEO

o Russell Black and Paul Goodson join as Non-executive Directors

o all Board changes take effect from 19 October 2017

· New financing provides for a fundraising of £24 million (gross) via secured Loan Notes, with conversion rights, subject to shareholder approval

o supported by investors, including Gatemore Capital and Hargreave Hale, and the new leadership team

o net proceeds will be used to address a working capital shortfall, capital expenditure and restructuring costs

· Firm foundations are in place for the Group's turnaround

Board Changes

DX, the independent parcels, mail and logistics operator, is pleased to confirm that the proposed changes to the composition of its Board of Directors, as reported on 9 October 2017, have come into effect.

Ron Series has assumed the role of Chairman from Bob Holt, who is retiring from the Company. Lloyd Dunn, who became Chief Executive Officer in a non-Board capacity on 9 October, now joins the Board, and Russell Black and Paul Goodson both join the Board as Non-executive Directors. Paul Murray is retiring as a Non-executive Director although will remain with the Company in a consultancy role over a three month period. Ian Gray continues in his role as a Non-executive Director until the Company's AGM in 2018.

Trading Update

DX, the provider of delivery solutions, including parcel freight, secure, courier and logistics services, announces the following update on trading for the financial year ended 30 June 2018 ("FY2018").

The Board is pleased to report that the Group's turnaround, which commenced at the start of 2018, is progressing steadily, and that both the DX Freight and DX Express divisions have delivered in line with management expectations in the second half. The Directors therefore expect the Group to meet market expectations for FY2018, which includes an underlying loss for the year. Net debt at 30 June 2018 is expected to be approximately £1.1m (30 June 2017: £19.1m), which is better than previously anticipated, and reflects improved working capital management.

As planned, turnaround initiatives in the period have been more focused on DX Freight, and net new business at DX Freight, which includes the Group's irregular dimensions and weight ("IDW") and logistics activities, has been encouraging and continues to gather momentum.

DX Express, which includes DX Exchange, Secure and Courier services, continues to develop its plan to separate DX Exchange from the Secure and Courier operations. In addition, the Group has enhanced the senior management capability within DX Exchange and strengthened the DX Express sales team.

The Board believes that the Group remains well positioned to make further progress against its Turnaround Plans as previously announced on 29 March 2018, and will provide a further update on trading with the announcement of full year results, expected in early October 2018.

The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014. Upon the publication of this announcement via regulatory news service this inside information is now considered to be in the public domain.

Reduction in net debt is impressive.