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Summary and Outlook Results for the year ended 31 January 2012 exceeded expectations as the Group benefited from its broad portfolio of services, strong geographic footprint and significant market share gains. In our trading update of 17 February 2012, expectations for the current year ending 31 January 2013 were revised when we said that the ongoing economic uncertainty in the Eurozone meant that our clients continue to exercise caution in relation to hiring permanent staff and that this had impacted demand for executive recruitment in the UK, the Nordics and mainland Europe. There has been no change to our outlook for the Eurozone at this time but, given recent market volatility, we are seeing unique opportunities, such as the acquisition of Talent-IT. In these situations we will be able to drive growth and create new market leaders in key geographies, when the market conditions improve. The outlook for freelance contracting remains encouraging with little evidence of a slowdown. As a result, the Board is pleased to report that underlying organic first quarter trading is on track and the acquisition of Talent-IT is expected to contribute an additional 5% increase to Group PBT (before non-recurring items) this year and a 10% increase next year.
Acquisition We are pleased to announce today the acquisition of the entire issued share capital of Talent-IT BVBA ("Talent-IT"), a Belgium based IT project and recruitment company, for an initial cash consideration of €1.7m. Talent-IT is headquartered in Antwerp and specialises in providing clients with flexible-working, highly skilled IT professionals for their permanent or project based vacancies. This acquisition marks another important step in the ongoing development of Harvey Nash's portfolio of services across its most profitable geographic regions. The acquisition will result in Harvey Nash's Benelux business becoming the market leader in the region. It will increase the total contribution of that business to 30% of the Group's mainland Europe revenue. In the year ended 31 December 2011, Talent-IT and its wholly owned subsidiary Team4Talent BVBA reported a combined profit before taxation of approximately €0.7m, turnover of approximately €11.3m and as at 31 December 2011 had gross assets of €4.4m and net assets of €0.5m. Harvey Nash has acquired 100% of the shares (the "Shares") in Talent-IT from Jeroen Fries, Christophe Orens, Dirk Vangrunderbeek and Jasna Pozna (the "Sellers") for an initial consideration of €1.7m payable on completion. In addition, Talent-IT has agreed to acquire the 50% of the shares of Team4Talent BBVA ("Team4Talent") not currently held by Talent-IT from Stefan Moelants for an initial consideration of €100,000. The Sellers and Stefan Moelants are to remain with Talent-IT and Team4Talent. Subject to certain earn-out thresholds of Talent-IT and Team4Talent being met, the Sellers and Stefan Moelants will receive, in aggregate, up to a maximum of €2.8million in deferred consideration over the next 3 years. The initial consideration, and any deferred consideration which becomes payable, is to be funded out of Harvey Nash's existing cash resources.
Financial position The Group has no term debt and continues to enjoy overall banking facilities of circa £40m. Dividends Subject to approval at the Annual General Meeting on 28 June 2012, and as previously announced, the Group proposes to pay on 13 July 2012 a final dividend for the year ended 31 January 2012 of 1.635p per share to shareholders on the register as at 22 June 2012. This marks an increase of 10% on the dividend for the same period in 2011 of 1.48p. The total dividend of 2.66p per share for the year represents an increase of 10% on 2010/11 (2.42p).
Interim Management Statement and Acquisition Harvey Nash, the global professional services group, is issuing its first Interim Management Statement for the financial year ending 31 January 2013, covering the period from 1 February 2012 to date. There have been no material events or transactions in the period other than those detailed in this statement. Current trading The Board is pleased to report that the Group performed ahead of budget during the first quarter ended 30 April 2012. Revenue rose 18% and gross profit was up 6% compared with the same period last year. The increase in revenue is being driven by a greater proportion of flexible labour services in our business mix. Operating profit, stated before non recurring items and the investment made in two new offices, is 10% ahead of last year. In our preliminary results statement on 30 April 2012, we announced that approximately £0.8m would be invested this year in two new office openings in Hong Kong and Sydney with effect from 1st February 2012. The Group is also relocating its London office achieving approximately £0.8m of annualised like for like savings, at a one-off cost of circa £0.6m. A sizeable amount of the investment in Asia and all of the relocation costs are budgeted for in the first half of the current financial year. Trading in our US markets remains encouraging with good growth seen in the first quarter. As expected and in line with our view expressed in the preliminary results statement, UK and European trading is more modest. Outsourcing continues to perform well.
http://www.investegate.co.uk/Article.aspx?id=201206010700096092E
Recruitment firm Harvey Nash also gets some kind words in the Times. Better-than-expected revenues in Britain and Ireland, plus exposure to the safer European economies like Sweden and Denmark mean the company is doing pretty well, in a difficult period. The US was the main weak spot but techie recruitment around Seattle is still impressive and with the shares trading on just nine times forward earnings, Tempus thinks Harvey Nash is a buy.
Harvey Nash has recommended a 10% increase in final dividend to 1.635p per share.
The group said current trading is in line with company expectations and it looks forward to expanding its geographical footprint in Asia in the coming year.
Commenting on current trading CEO Albert Ellis said, "We are seeing the benefits of our focus both on high growth technology markets and on the robust economies of Northern Europe." "We made significant market share gains which delivered an increase in operating profit of 19% in the UK despite the widely reported weakness in the recruitment market and a 59% increase in operating profit in Europe against a background of uncertainty over the euro zone. All of this growth is organic.
UK & Ireland exceeded expectations with operating profit up 19%, while Germany and the Nordic region underpinned a 59% rise in operating profit from Europe. The group, which operates from 39 offices in the US, Europe and Asia, said total revenue for the year ended 31 January 2012 rose to £533m from £422m the year before while pre-tax profit rose 35% to £8.5m. Gross profit climbed 15% to £78.5m and operating profit surged 41% to £9m.
Recruitment consultancy and IT outsourcing service provider Harvey Nash revealed a robust set of annual results amid strong demand from its UK and Nordic markets. The group said it gained significant market share in the Nordics and the UK, with robust demand for flexible labour continuing despite uncertainty in the euro zone.
Current trading and Outlook Results for the year ended 31 January 2012 exceeded expectations largely as a result of the Group's broad portfolio of services and significant market share gains. However, in our trading update of the 17 February 2012, expectations for the current year ending 31 January 2013 were revised when we said the ongoing economic uncertainty in the Euro zone meant that our clients continue to exercise caution in relation to hiring permanent staff and that this had impacted demand for executive recruitment in the UK, the Nordics and mainland Europe. As our clients begin to focus increasingly on the Asia Pacific region, we will invest £0.75m in new offices in 2012 in Asia Pacific to meet growing demand in the region and to supplement our existing offices in Vietnam. Whilst the softening of permanent recruitment demand experienced in the fourth quarter has resulted in lower run rates into the first quarter of the current year, this now appears to have stabilised. The outlook for freelance contracting remains encouraging with little evidence of a slowdown. As a result, the Board is pleased to report that first quarter trading is on track to deliver in line with current expectations.
No movement in SP though - looks like the months ahead are obviously the worry
Commenting on the results, Albert Ellis, Chief Executive Officer, said: "I am delighted to announce another excellent set of financial results, which exceeded expectations. We are seeing the benefits of our focus both on high growth technology markets and on the robust economies of Northern Europe. We made significant market share gains which delivered an increase in operating profit of 19% in the UK despite the widely reported weakness in the recruitment market and a 59% increase in operating profit in Europe against a background of uncertainty over the Euro zone. All of this growth is organic. Clearly our unique portfolio of services and strong brand have given us a competitive advantage in challenging markets and we are looking forward to expanding our geographical footprint in Asia in the coming year."
Yes Nathan - looking good
Financial highlights · Organic growth in revenue of 26% · Operating profit up 41% · Profit before tax up 35% · Earnings per share up 36% · Strong operating cash inflow up 35% before investment working capital · 10% increase in final dividend, to 1.635p per share
Shore Capital reiterated its "buy" recommendation for Harvey Nash (HVN), ahead of the IT recruitment agency's full year results due on 30th April, noting that the group previously confirmed pre-tax profit growth of 31% to 8.2 million pounds. The broker said that demand for skilled workers in the digital and mobile sectors remained strong, although there was some weakness in the executive search markets in Europe. On Shore Capital's forecasts, the shares trade on an earnings multiple of 10 times for the 2013 financial year, and yield 4.8%
http://www.investegate.co.uk/Article.aspx?id=201204300700172922C
Nice steady progress here
The Mayor of London, Boris Johnson, said: "This is a great example of an ambitious, truly global company recognising why London is the best big city to do business. The commitment shown by Harvey Nash is a great sign of confidence in the capital and will provide a welcome boost for jobs and the wider economy. By moving to the Heron Tower they have chosen a stunning location for their new home, right in the heart of the City." Albert Ellis, CEO of Harvey Nash, said: "London is a fantastic location for all British companies who are exporting services and expanding internationally. Access to a highly skilled workforce combined with a 21st century facility such as the Heron Tower supports our mobile workforce and in our view it's the best anywhere in the world. "And the UK as a whole is on the up. The government's focus on emerging markets and in particularly China, is in line with our strategy as we expand from our base in Vietnam into China and Australia in the first half of 2012. In Asia, London is highly regarded by businesses and governments alike. The opportunity to benefit from the Group's association with Britain's most valuable asset is significant. We are very proud to remain in London."
· Talent. London will remain the human capital hotspot of the world attracting not only highly skilled young people from all over the UK and Ireland but increasingly, becoming the destination of choice for many top graduates from Asia and Europe. · Silicon Roundabout. London has one of the fastest growing and most innovative online media sectors in the world outside of California. In particular, Shoreditch and east of the City are becoming globally pre-eminent in this hugely important digital and mobile market. · Business friendly. We are encouraged that the UK's international competitiveness has been prioritised in policy making by the Mayor of London and the Coalition Government. · Competitive position. Although much more needs to be done, when ranked against comparative locations in Europe and the USA, corporate tax rates are on a downward trend and the UK's flexible labour market is recognised by both main parties as a strategic asset, particularly when compared to mainland Europe · UK expansion. Harvey Nash has recently opened new offices in Manchester and Edinburgh and expanded in Leeds and Birmingham. We see the UK's unique creative and digital skills base benefitting from global mobile and technology convergence trends. · Iconic location, 21st century facility. The new relocation at Heron Tower combines cutting edge design including state of the art carbon reduction and sustainability features, with easy access to the West End, Docklands and City Airport.
Harvey Nash Invests in London's Future Boris Johnson hails Harvey Nash's decision to retain its global headquarters in London. Harvey Nash, the global professional services group, has chosen to retain London as its global headquarters when it relocates offices later this year. Harvey Nash, a finalist in the Orange Mid Cap Business of the Year Awards, has over 6,000 consultants and highly skilled technology freelance specialists in 40 offices across three continents. As a mark of its confidence in the City of London's pre-eminence as an international business hub, Harvey Nash will re-locate from its current Mayfair HQ to Heron Tower, EC2. The Group is expected to invest up to £2m in capital expenditure and new technology over the next five months. The total lease expenditure is likely to exceed £10 million over the next 10 years. As part of the selection process, the Group shortlisted cities such as New York, Dublin, Zurich and Hong Kong as potential locations for its new headquarters. The decision to choose London as its base for the next decade was based on the following critical factors:-
http://www.investegate.co.uk/Article.aspx?id=201202170703075922X
A good day ahead then for HVN
Summary and Outlook The strong financial results for the year ended 31 January 2012 , market share gains and client wins have been driven by the Group's market leading brand positioning and its broad portfolio of services. Tight cost control and management of working capital have facilitated growth without negatively impacting cash flow. As our clients begin to focus increasingly on the Asia Pacific region, we will invest £0.75m in new offices in 2012 in Asia Pacific to meet growing demand in the region and to supplement our existing offices in Vietnam. This year we also intend to relocate our London office to achieve significant economies of scale and take advantage of a subdued rental market. The relocation will result in a circa £0.8m exceptional item in the first half with savings flowing through into the final quarter of the year and savings over a ten year period expected to be in the region of £1.0m per annum. Capital expenditure, expected to be approximately £1.5m, will be fully funded through financial incentives which have been secured in the lease agreement. Ongoing economic uncertainty about the Eurozone means that our clients continue to be cautious although the outlook for freelance contracting remains encouraging with little evidence of a slowing of temporary recruitment. However, should executive recruitment globally continue the trend seen in the fourth quarter of calendar year 2011 then this is likely to result in profits being lower than the previous year, excluding the effect of the relocation and fresh investment in Asia. With the benefit of an experienced management team, continuing strong trading cash flow and a healthy balance sheet the Group is confident of making further progress as markets stabilise and business confidence begins to rise again.