Penna warns as public sector contracts delayed

Outplacement specialist and recruiter Penna Consulting has slumped to a four-month low after warning that profits for the year to March will be "materially lower" than market expectations.The group said demand for help with CV writing and interview technique is increasing within the public sector as government cuts begin to bite, but delays to new projects mean there'll only be a "modest" contribution from them in the year ending 31 March 2011.Although it's won 57 big outplacement contracts during the year and is negotiating another 55, the coalition's spending review has forced central and local government bodies, non departmental public bodies, the police, universities and hospitals to axe thousands of jobs."Public sector bodies are planning carefully the difficult and complex process of restructuring and seeking to handle implementation of each phase of redundancy with sensitivity," explained Penna. "As a result we are finding that the effective commencement of each project is later than anticipated."The company is making its own cutbacks during the financial year, reducing the number of staff by 122 to just 375. Profits before exceptional items will be "nominal", it admits, but reckons the year ending 31 March 2012 will see the benefit from the pipeline of work carried forward." Present indications are that our financial performance in that period will show significant improvement over the current financial year," it says.