Driver Group PLC - Lancashire-based professional services consultancy to construction and engineering industries - Says it will transfer 25 employees to join another entity in the Middle East region on June 1. These employees will retain some project assignments, but with restrictive undertakings regarding the company's current clients and employees. Additionally, the counterparty will take on the current regional debtor book's GBP3.5 million. It has also agreed to pay around GBP2 million in cash upfront as an advance payment of the debtor book.
After the transfer, Driver Group's annualised reduction in the regional cost base is expected to exceed GBP3 million annually, against the GBP1 million in annual cost savings announced on March 29 this year.
Driver Group Chief Executive Mark Wheeler says: "We have worked very hard to identify and implement the optimal solution for the company's operations in the Middle East. The agreement we have reached will allow us to focus on the client base and market segments that are the best fit for Driver Group's wider business, and should facilitate higher utilisation, significantly improved profitability, and enhanced sustainability for the global business."
The company expects a pretax profit of between GBP300,000 to GBP500,000 for the six months that ended on March 31, at best, a 42% fall from GBP855,000 a year earlier.
Current stock price: 32.11 pence, up 17% in London on Monday
12-month change: down 35%
By Xindi Wei; xindiwei@alliancenews.com
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Driver Grp (DRV)