December 2005 News from the Hargreaves Group Aiming High! Dear Colleagues There is no doubt that these are exciting times for us all within the Hargreaves ‘family’ of companies. We have all come a long way from the days in the mid 1990’s when what has now become the Hargreaves Group comprised just 20 vehicles hauling coal. Now, we are one of the UK’s leading providers of bulk materials and services to the electricity generating industry and other major bulk material consumers. We have grown by implementing carefully managed development plans.We have grown organically, by winning new business; we have grown by diversifying into new business areas; and we have grown by acquiring other, complementary businesses. Our success so far has given us both the strength and the confidence to announce our flotation on the Alternative Investment Market (AIM), operated by the London Stock Exchange. By the time you read this magazine, you will already have learned something about our flotation; and within the next few pages you have an opportunity to find out a lot more about what it means for the Company – and for you. That last sentence is particularly relevant; our businesses continue to succeed because opportunity to become shareholders in our of the talents and efforts of our people, and thriving business. I want to thank you for your continuing In this issue ... commitment to providing our customers We have now reached a stage in our with such an excellent service. development where our business objectives P 2: Your guide to the can be more readily achieved as a publicly stock market At this exciting time in our corporate quoted company.‘Going public’ on the AIM P 3: Minibuses for growth it is only right that you should will provide us with new sources of funds Derwentside have an opportunity to share in our future that in turn will help us grow at an P 4-5: Focus on Monckton success. ever-increasing pace – for the benefit of us all. P6: Sharesave & Meet your HR team We are launching a Sharesave scheme for Yours truly, P7: HCCP wins Drax the majority of our workforce (discussed contract in detail on page 6). I urge you to read it Gordon Banham P8: Watch your step carefully for it offers you a risk-free Group Chief Executive See inside for your copy of the Hargreaves DVD. Your guide to the Stock Market What is The Stock Exchange What are the advantages of FTSE AIM UK 50 and in particular AIM? holding shares? This is the list of the 50 largest UK AIM The Stock Exchange is a market on which By holding shares, you have the potential to companies, the so-called “cream of UK AIM shares are bought and sold (or “traded”). share in the success of the company stocks”. The Alternative Investment Market (“AIM”), through Dividends or Capital Growth; the which is part of the London Stock Exchange better a company does the higher the FTSE AIM 100 and on which Hargreaves will trade its investment returns. This lists the 100 largest AIM-listed shares, was opened in 1995 and over 1,500 companies globally. companies from all over the world have Dividends joined it. A dividend is a payment made to shareholders Which factors affect the share out of company profits. Not all profit is paid price of a company? What is a Share? out in dividends. Some is reinvested in the company (sometimes all). But it is not The share price will be influenced by a large Basically a share is a unit of ownership in a necessarily a bad thing for the shareholder number of factors, many of which are company.When you buy a share you if dividends are not received. If profits are outside the company’s control. become a part-owner, a shareholder, in the ploughed back into the company, the The factors may include: company.A company whose shares may be company may grow and that, in turn, can bought by the public and traded on the • The financial performance and prospects mean an increased value of the shares. of the company; open market is called a quoted Public This is of course an advantage to the Limited Company (“PLC”). shareholder. • The performance and prospects for the industry in which the company operates; A Share has a market price i.e. the price at Capital Growth •Political, general economic, financial and which it is currently trading.You’ll find Capital growth occurs when a rise in the Stock market conditions, particularly prices quoted in most newspapers and in share price gives you the opportunity to where the company operates or is listed; specialist investment magazines, on Teletext sell your shares at a profit. Capital growth is and on the internet. (Try http://www.lon- • The perceptions of investors about the not certain as it depends on what happens above factors; donstockexchange.com/en-gb/pricesnews/ to the share price, which can be affected by for example) a number of factors. It is also possible to What are the key times during have a capital loss if the share price falls. How are share prices displayed / the year for a listed company? quoted? What are Market Indices? There are 3 key times for a listed company and they are based around the time the All share prices are quoted with a “two way A market index is a benchmark of the value company announces its’ results to the price” a bid and offer spread which is the of a range or market of shares. It allows you market (a requirement of being listed). price that you can buy (the offer) and the to see what the overall performance of the price that you can sell (bid) the particular market is, and allows you to compare an All companies have a “Year end” – a point share.This price will update constantly individual shares’ performance against the in time during the year when the company’s general trend of the market. throughout the market opening hours, financial year begins and ends. In Hargreaves which for UK shares is 8:00 to 16:30.The example the year-end is 31st May.The When people refer to the current level of middle price is the one quoted in the Preliminary results are a review of the whole “the market” in the UK they are often newspapers, it being the middle price year, and the Interim results are a review referring to the FTSE 100 between the bid and the offer price. of the first 6 months of trading by the company.At these times of the year Why do companies List on the FTSE 100 (Footsie) management will have to present the results Stock Market? This is an index of the largest 100 UK to the shareholders of the company.The Companies generally list on the stock Companies by market capitalisation.The other key time in the financial calendar of a market in order to raise money for their price of the index is updated every minute. listed company is the Annual General company and create a market in the (Why FTSE/footsie? The index is maintained by Meeting (sometimes called the AGM) a company’s shares; the owners give up a the FTSE Group, a now independent company mandatory yearly meeting of shareholders share in the company in return for money which originated as a joint venture between the that allows stakeholders to stay informed to help expand the company. Financial Times and the London Stock and involved with company decisions and Exchange). workings. Hargreaves intends to use the money it has raised to reduce some of its debt facilities FTSE 250 and therefore enabling it to further grow This lists the 250 largest companies after and seek further suitable acquisitions. the FTSE 100. Minibuses will be Welcome! Welcome to the first issue of used by young and ‘Moving Mountains’, a new W magazine for everyone in the Hargreaves Group. old in Derwentside This launch issue is a little unusual because we are - quite naturally – devoting a lot of space to THE major Hargreaves news story of the moment – the floating of the company on the stock exchange. In future issues of Moving Mountains we plan to include news from all of our operating divisions - and for that to happen we’ll need you to send us your news on a regular basis please! By the time you get to read this newsletter, you will almost certainly have heard the news about our company flotation, whether by email, letter, or via site notice boards etc. Our lead feature on page 2 (opposite) offers you a quick guide to the stock market.We’ve tried to ask the questions you might already have thought of – and more importantly, we’ve provided some answers, too! On page 6 you’ll find an article about our new ‘sharesave’ scheme, which offers a real opportunity to share in the Hargreaves success story. Most of you will already have received a detailed information pack about ‘sharesave’ through the post, so this article is designed to reinforce the message that the scheme could t Esh Winning we have been rely upon parents using their cars to get prove to be very good news indeed! busy lending a valuable helping our lads to away fixtures.The bus that A hand to the local community in we have been designated will be a Elsewhere, you’ll find a special feature on Derwentside. tremendous asset and we wish to thank Monckton Coke Works that we hope will give Hargreaves for their tremendous you a clear picture of what happens on site at th this major new part of the Hargreaves business On October 25 , Hargreaves Technical contribution to our children”.