LONDON (Alliance News) - Hydrogen Group PLC Monday reported a fall in profit for the full-year, as it increased its headcount and faced problems in Australia.
The recruitment company posted pretax profit of GBP2.4 million for 2013, down from GBP3.2 million, even though revenue climbed to GBP181.6 million, from GBP167.0 million a year earlier.
Hydrogen said the decrease in profit reflects, "the investments made to support out longer term goals."
Headcount rose to 383 from 368, as the company took the conscious decision to attract more experienced recruiters and senior managers. Administrative costs rose 5% to GBP29.4 million from GBP27.9 million, with a notable increase in sales headcount in the second-half.
The firm said given the inevitable time lag for new members of the team to generate fees, the increase in costs exceeded the growth in net fee income (NFI), causing a reduction in the conversion to profit to 7.9% in 2013 from 10.8% in 2012. Nonetheless, revenue rose 9%.
Looking ahead, the company said it plans to grow its international footprint, to reduce its reliance on UK revenues. UK NFI declined 3% which limited the growth in overall NFI to 2%. However, NFI from outside the UK rose by 9% to GBP13.9 million from GBP12.8 million, with new offices opened in Norway and the US.
The Australian recruitment market on the other hand continues to be tough and Hydrogen said its Australian office experienced a 19% decline in net fee income in 2013.
"With no clear signs of recovery in Australia's principal economic sectors, we took the decision at the end of 2013 to redesignate Sydney as a 'spoke' office and move operational support to Singapore and London for the medium term," the firm said.
Despite a fall in profit, the firm increases its final dividend 3% to 3.1 pence from 3.0 pence, making a total dividend for the year of 4.6 pence from 4.5 pence.
The stock last traded Friday at 108.00 pence.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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Anthony Tshibangu
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