LONDON (Alliance News) - Management Resource Solutions PLC Wednesday said its full year results will be "adversely impacted" by exceptional costs, leading the company to abandon its plans to pay a full year dividend.
However, the company is also edging closer to sealing a deal to acquire an Australian earthmoving business sometime in November.
The company said the exceptional costs to be booked in the financial year ended June 30, totalling around AUD2.0 million, relate to its initial public offering in December 2014 and the aborted takeover attempt in June of D&M Group after the target walked away from the deal.
Total income for the financial year is expected to have risen to around AUD17.0 million from AUD10.5 million a year earlier, but the company said those exceptional items will lead to a loss after tax of around AUD900,000. In the previous year it booked a AUD52,000 profit after tax.
Excluding the exceptional items, Management Resource said it would have made a profit after tax of around AUD1.0 million, which would have represented a significant year-on-year rise.
As a result of the anticipated loss, the company said it will not pay a full year dividend following on from its interim dividend of 0.35 pence per share.
In addition, the company said it has secured a AUD5.5 million four-month contract in Papua New Guinea. Management Resource said it has taken a year to secure the contract and that it originally envisaged closing the deal before the end of June 2015.
"The company has also tendered for numerous large projects in the Asia Pacific region and continues to see a steady pipeline of opportunities," it said.
On a brighter note, the company said it is closing in on a deal to purchase an earthmoving business in Australia.
The company had its shares suspended from trading on AIM on August 20 pending an announcement about a potential reverse takeover. The company has signed heads of terms with the unnamed earthmoving business in Australia, but the deal will still need approval from shareholders and Westpac Bank.
"Work has commenced on the legal due diligence necessary prior to finalising a share sale agreement and securing formal approval from Westpac Bank in regards to a loan facility required for the acquisition," it said.
Management Resource said it hopes to send an circular to shareholders concerning the acquisition by mid-November, when it hopes it shares can resume trading on AIM.
Management Resource shares were down 13% to 8.50 pence per share on Wednesday afternoon.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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