LONDON (Alliance News) - Norman Broadbent PLC Wednesday said its pretax loss widened significantly in its last financial year, hit by the company's continued investment in its new subsidiaries and efforts to streamline its international business and focus on its UK and US operations.
In a statement, the executive search firm said it made a GBP1.1 million pretax loss in 2013, compared with a GBP73,000 loss in 2012. Revenue decreased marginally to GBP7.55 million, from GBP7.63 million, while operating expenses widened to GBP8.4 million, from GBP7.1 million.
Within its main revenue source, executive search, UK revenue fell to GBP5.4 million, from GBP6.4 million, while overseas executive search revenue increased to GBP230,000, from GBP194,000. According to Norman Broadbent, the reduction in UK executive search revenues reflected a reduction in fee generating headcount during the year, but with higher profitability. This was partly offset by a near doubling in assessment, coaching and talent management revenue, which rose to GBP1.1 million, from GBP586,000.
AGP, previously known as Arcus Global Partners, and Connecting Corporates, the two new subsidiary businesses established in early 2013 and late 2012, generated GBP556,000 in revenue between them, compared with GBP36,000 in 2012, while start-up losses rose to GBP640,000, from GBP3,000.
Executive Chairman Pierce Casey said AGP and Connecting Corporates will become profitable during the year.
Norman Broadbent streamlined its international operations, selling its 51% owned Belgian subsidiary to management on May 8 for GBP120,000, against its cash investment of GBP137,000, which will result in a GBP112,000 impairment in 2014 and a loss on disposal of GBP128,000. Earlier this week, the company agreed to sell its 20% stake in NBS Norman Broadbent SA, after it terminated its executive search and leadership consulting licenses in Italy and the Middle East and North Africa in March.
New Chief Financial Officer James Webber, who joined in March, has also been appointed as the company's Chief Operating Officer.
"Trading in January and February 2014 in UK executive search was strong whilst March 2014 was disappointing. Overall, group revenues in the first quarter of 2014 were marginally ahead of the same period last year," Casey said.
"For the second quarter to June 31, 2014 the UK executive search team anticipates an encouraging performance based on activity to date and the current strong pipeline, and our start up bespoke contingency, and digital start ups are contributing to growing revenues in a satisfactory way," Casey added.
Norman Broadbent shares were Wednesday trading down 17.3% at 31.00 pence, one of the biggest declines on the London market.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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Norman Broadb (NBB)