Last checked at 4 Aug 2016 07:00
4 August 2016
Matchtech Group plc
("Matchtech" or, "the Group")
Trading Update for 12 months ended 31 July 2016
Matchtech Group plc (LSE-AIM: MTEC), the UK's leading specialist Engineering and Technology (IT & Telecoms) recruitment agency, today provides the following pre-close trading update for the 12 months ended 31 July 2016.
The Board expects profits to be in-line with its previous expectations.
Group performance
Net Fee Income (NFI) performance can be summarised as follows:
Actual | FY 2016 | FY 2015 | Change |
£m | £m | % | |
Contract NFI | 53.9 | 40.0 | +35% |
Permanent NFI | 19.3 | 14.8 | +30% |
Total NFI | 73.2 | 54.8 | +34% |
Like for Like1 | H1 | H2 |
| FY | |||||||
2016 H1 | 2015 H1 | Change | 2016 H2 | 2015 H2 | Change |
| 2016 | 2015 | Change | ||
£m | £m | % | £m | £m | % |
| £m | £m | % | ||
Contract NFI | 26.5 | 27.0 | -2% | 27.3 | 26.9 | +1% |
| 53.8 | 53.9 | 0% | |
Permanent NFI | 9.4 | 9.2 | +2% | 9.4 | 8.8 | +7% |
| 18.8 | 18.0 | +4% | |
Total NFI | 35.9 | 36.2 | -1% | 36.7 | 35.7 | +3% |
| 72.6 | 71.9 | +1% | |
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2016 H1 | 2015 H1 | Change | 2016 H2 | 2015 H2 | Change |
| 2016 | 2015 | Change | ||
£m | £m | % | £m | £m | % |
| £m | £m | % | ||
Engineering | 21.7 | 20.3 | +7% | 21.8 | 20.8 | +5% |
| 43.5 | 41.1 | +6% | |
Technology | 14.2 | 15.9 | -11% | 14.9 | 14.9 | 0% |
| 29.1 | 30.8 | -6% | |
Total NFI | 35.9 | 36.2 | -1% | 36.7 | 35.7 | +3% |
| 72.6 | 71.9 | +1% | |
1 Like for Like assumes Networkers had been owned for the entire prior period and excludes NFI from the Networkers Search business divested in January 2016 and from the discontinued Professional Staffing London operation (2015 H1: £1.0m; 2015 H2 £1.3m; 2016 H1: £0.6m; 2016 H2: £nil)
Group NFI of £73.2m, including the full year effect of the Networkers acquisition which was completed on 2 April 2015, was up 34% on the prior year (+1% on a LFL basis).
On a LFL basis Engineering's NFI was up 6% on prior year with similar levels of growth in both halves of the year, up 7% and 5% respectively. Contract NFI increased by 5% (H1: 5%, H2: 5%) and Permanent Fees increased by 9% (H1: 12%, H2: 5%). There was particularly strong annual growth in Infrastructure, Professional Staffing, and Engineering Technology offset by weaker performance in Oil & Gas and Maritime.
On a LFL basis Technology's NFI was down 6% year on year (H1: -11%, H2: 0%). Telecoms performed strongly with NFI up 9% (H1: +3%, H2: +15%), but as previously reported, due to a challenging first half, the IT division's NFI was down 16% year on year (H1: -21%, H2: -12%). The IT market segmentation and sales restructure, announced at April's Interim results and carried out in Q4 2016 is already starting to bear fruit. NFI stabilised in H2 and was broadly in line with H1. Further benefits are expected to be seen in the new financial year.
People
We continue to invest in appropriate areas with sales headcount up 9% on 31 July 2015 to 544.
During the period we appointed Regional Managing Directors to run our Asia and Americas operations and a number of experienced and successful, UK based consultants and managers are transferring to our Dallas office in order to accelerate the development of our Engineering business in the US.
Net Debt
Net debt at 31 July 2016 was £27.5 million, down £6.1 million on 31 July 2015.
Integration of Networkers
The integration continues to go well and is expected to be fully completed by the end of Calendar 2016.
Change of name
As announced on 18 July 2016, Matchtech Group plc intends, subject to shareholder approval, to rename as Gattaca plc.
The proposed change follows extensive research conducted by the Group of its employees, candidates and current and potential clients as to their view of the constituent brands that make up the enlarged Group. This research showed that the Group brand (Matchtech Group plc) and the operating engineering brand (Matchtech) sharing the same name could be a source of confusion.
Preliminary Results
The Group expects to announce its full year results for the 12 months to 31 July 2016 on Thursday 3 November 2016.
Brian Wilkinson, Chief Executive Officer, said:
"As I reported at the time of the Interim Results in April, demand for skilled engineers remains strong in the UK and, notably, we have yet to see any impact on vacancy flow in the six weeks since the EU Referendum.
"We have seen strong growth in our Engineering division and, in Technology, the market segmentation and sales restructuring we have undertaken in the IT business has given us confidence for the new financial year.
"We remain committed to our strategy of being the leading specialist Engineering and Technology recruitment group. The proposed change of plc name is the next step in the Group's development, following the acquisition of Networkers International plc in April 2015. The acquisition brought Telecoms and Technology expertise to Matchtech's existing strength in Engineering and Technology. It has enabled the Group to capitalise on the convergence of the skill sets demanded by these markets and allowed Matchtech to internationalise its existing service offering by leveraging Networkers' global infrastructure.
"Our proposed new name, Gattaca, is a sign of our ambition and I remain confident that we will convert the exciting opportunities available to the Group into growth."
- ENDS -
For further information please contact:
Matchtech Group plc | +44 (0) 1489 898989 |
Brian Wilkinson, Chief Executive Officer Tony Dyer, Chief Financial Officer
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Citigate Dewe Rogerson - Financial PR | +44 (0) 20 7638 9571 |
Rob Newman/Nick Hayns
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Numis Securities Limited | +44 (0) 20 7260 1000 |
Michael Meade / Tom Ballard
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About Matchtech
Matchtech Group plc (LSE-AIM: MTEC), is the UK's leading specialist Engineering and Technology (IT & Telecoms) recruitment agency, providing contract, temporary and permanent staff. Established in 1984 and AIM-listed in 2006, the Group is one of the fastest growing staffing organisations listed in the UK, with a well-balanced business model; approximately 70% contract and 30% permanent.
In April 2015, Matchtech Group plc announced the completion of the acquisition of Networkers International, a global recruitment company specialising in the delivery of recruitment services focussing on Telecoms and Technology.
Recruiting in over 100 countries across the world from 14 offices in 11 countries, the Group has over 550 sales staff, with over 9,000 contractors on assignment and places 4,000 candidates into permanent positions each year.
The combined group is well-placed to take advantage of the convergence between Engineering, Technology and Telecoms skill sets and creates a specialist recruiter, of scale, in the UK and internationally.