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Half Yearly Report

7 Nov 2014 07:00

RNS Number : 3452W
Prime People PLC
07 November 2014
 



 

 

 

 

 

 

7 November 2014

 

Prime People Plc

 

Unaudited Condensed Consolidated Interim Report

 for the six months ended 30 September 2014

 

 

CHAIRMAN'S STATEMENT

 

Overview

The Group is pleased to report improved Operating Profit of £0.6m in the first half of this year compared to £0.29m achieved in the comparable period last year. The growth in the period has been generated from our permanent business which remains the main focus of our business, representing 93% of Net Fee Income (NFI) compared to 90% in the comparable period of 2013.

 

The improvement in performance highlighted in our 2014 annual Report has continued through in to the current period. NFI in the period for the Group is £5.0m which is a 32% increase on last year (2013: £3.8m). There were a number of strong NFI performances in both the UK and Asia. In the UK NFI increased by 28% from £2.5m to £3.2m and in Asia NFI increased by 59% from £0.9m to £1.4m.

 

Our Singapore office, which is our most recently established office, has continued to develop and is now profitable, which compares well with the break even performance reported in the same period last year.

 

Financial Results

Group revenue increased by 18% for the period to £8m (2013:£6.8m).

 

Administrative costs for the group have increased from £3.5m in 2013 to £4.4m in the current period which is in part a consequence of higher commission paid to consultants for improved performance and in part an up lift in fee earning head-count of the Group.

 

Profit before taxation for the period has increased to £0.6m (2013:£0.3m)

 

The charge for taxation is based on the expected annual effective tax rate of 21% (2013: 23%).

 

Basic earnings per share for the period has increased to 4.17p (2013:1.94p).

 

Return of capital to shareholders

At the start of the year the Group had net cash of £2.96m. As outlined when we announced our final results for 2014 it was the intention of the directors to return cash to shareholders. A circular was sent to shareholders on 29 May 2014 explaining the background to and reasons for the proposed return of capital and convening a General Meeting on 16 June 2014. At the meeting shareholders approved the reduction totalling £1.8m. On 16 July 2014 we announced that the capital reduction had been confirmed by the Court and on the 24 July cheques amounting to 14.809329 pence per share were sent to shareholders.

 

 

 

 

 

CHAIRMAN'S STATEMENT (cont)

 

Cash Flow

Following the return of capital of £1.8m the Group continues to maintain a strong net cash position.

 

After net taxation payments of £0.1m (2013: receipts £0.01m) cash generated from operations was £0.37m (2013: £0.99m). A final dividend for 2014 of £0.38m was paid in June 2014 (2013: £0.37m). At the end of the period the Group had net cash of £1.1m (2013: £2.8m)

 

 

Dividend

Given the level of trading in the first half of 2014 the Board will be declaring an interim dividend of 1.75p (2013: 1.00p).

 

Outlook

We have reasonable expectations that the UK businesses will continue to perform at least at similar levels to the first half of the year. We are looking for continued improved performance from our businesses in Asia which we believe will provide us with increased opportunities for growth in the mid to long term, but continue to have conservative expectations as to the likely performance from our businesses in the Rest of the World.

 

The focus for the Group is to maximize the returns from recent investment in the business and continue to recruit new heads into those markets where there is potential for NFI and profit growth.

 

 

 

 

 

 

Robert Macdonald

Executive Chairman

7 November 2014

 

 

For further information please contact:

 

Prime People

020 7318 1785

Robert Macdonald, Executive Chairman

Chris Heayberd, Finance Director

Cenkos Securities

020 7397 8900

Ivonne Cantu - Nomad

Elizabeth Bowman - Nomad

Julian Morse - Sales

 

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 30 September 2014

 

 

Six months ended

Year ended

30 September

2014

30 September

2013

 

 

31 March

2014

Note

£'000

£'000

£'000

Revenue

3

8,028

6,810

14,442

Cost of sales

 

(3,030)

(3,048)

(6,115)

Net fee income

4,998

3,762

8,327

Administrative expenses

 

(4,364)

(3,475)

(7,300)

Operating profit

634

287

1,027

Finance income

6

10

20

Finance expense

 

-

-

(2)

Profit before taxation

640

297

1,045

Income tax expense

 

4

(135)

(67)

(203)

 

Profit for the period/year

 

505

 

230

 

842

Other comprehensive (loss)/income:

 

Exchange gain/(loss) on translating foreign operations

 

 

 

 

35

 

 

 

(71)

 

 

 

(111)

 

Total comprehensive income for the period/year

 

 

540

 

159

 

731

Attributable to:

 

Equity shareholders of the parent

 

 

 

540

 

 

 

159

 

731

Earnings per share

6

Basic earnings per share

4.17p

1.94p

7.10p

Diluted earnings per share

 

3.89p

1.88p

6.83p

 

The above results relate to continuing operations.

 

The notes on pages 6 to 11 form an integral part of this unaudited condensed consolidated interim report.

 

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

 

As at 30 September 2014

 

30 September

2014

30 September

2013

31 March

2014

Note

£'000

£'000

£'000

Assets

Non-current assets

Goodwill

9,769

9,769

9,769

Property, plant and equipment

386

280

328

Deferred tax asset

 

-

25

-

10,155

10,074

 

10,097

Current assets

Trade and other receivables

9

3,695

3,310

3,535

Cash and cash equivalents

 

1,114

2,757

2,963

4,809

6,067

 

6,498

Total assets

 

14,964

16,141

16,595

Liabilities

Current Liabilities

Financial liabilities

-

7

1

Trade and other payables

10

1,883

1,998

2,005

Current tax liabilities

 

165

240

151

2,048

2,245

2,157

 

Non-current liabilities

S

Deferred tax liabilities

 

21

15

-

15

21

-

15

 

Total liabilities

2,069

2,245

2,172

Net assets

 

12,895

13,896

14,423

Capital and reserves attributable to the Company's equity holders

Called up share capital

Capital redemption reserve

1,217

9

1,207

9

1,207

9

Treasury shares

(146)

(191)

(143)

Share premium account

5,356

7,109

7,109

Merger reserve

173

173

173

Share option reserve

173

117

120

Currency translation differences

347

352

312

Retained earnings

5,766

5,120

5,636

Equity shareholders funds

 

12,895

13,896

14,423

The notes on pages 7 to 12 form an integral part of this unaudited condensed consolidated interim report.

 

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2014

 

Called up share capital

Capital redem-

ption

reserve

 

 

Treasury shares

 

Share premium account

 

 

Merger reserve

 

Share option reserve

Foreign currency trans-

lation

 

 

Retained earnings

 

 

 

Total

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

At 1 April 2013

 

1,207

 

9

 

(191)

 

7,109

 

173

 

97

 

423

 

5,256

 

14,083

Total comprehensive income for the period

 

-

-

 

-

 

-

 

-

-

 

(71)

 

230

 

159

Adjustment in respect of share schemes

 

-

-

 

-

 

 

 

-

 

20

 

 

-

 

20

Dividend

 

-

-

-

-

-

-

-

(366)

(366)

 

At 30 September 2013

 

1,207

 

9

 

(191)

 

7,109

 

173

 

117

 

352

 

5,120

 

13,896

 

Total comprehensive income for the period

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(40)

 

 

612

 

 

572

Adjustment in respect of share schemes

 

 

-

 

-

-

 

-

 

-

 

3

 

-

 

23

 

26

Shares issued from treasury

 

-

-

53

-

-

-

-

-

53

Shares purchased for treasury

-

 

-

 

(5)

 

-

 

-

 

-

 

-

 

-

 

(5)

Dividend

 

-

-

-

-

-

-

-

(119)

(119)

 

At 31 March 2014

 

 

1,207

 

9

 

(143)

 

7,109

 

173

 

120

 

312

 

5,636

 

14,423

 

Total comprehensive income for the period

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

35

 

 

505

 

 

 540

Adjustment in respect of share schemes

 

-

 

-

 

-

 

-

 

-

 

53

 

-

 

-

 

53

Issue of ordinary shares

10

-

-

47

-

-

-

-

57

Return of capital

-

-

-

(1,800)

-

-

-

-

(1,800)

Shares issued from treasury

-

-

12

-

-

-

-

-

(12)

Shares purchased for treasury

 

-

 

-

 

(15)

 

-

 

-

 

-

 

-

 

-

 

(15)

Dividends

 

-

-

-

-

-

-

-

(375)

(375)

 

At 30 September 2014

 

 

1,217

 

9

 

(146)

 

5,356

 

173

 

173

 

347

 

5,766

 

12,895

 

The notes on pages 7 to 12 form an integral part of this unaudited condensed consolidated interim report.

 

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOW

For the six months ended 30 September 2014

 

 

Six months ended

Year ended

30 September 2014

30 September

2013

31 March

2014

Note

£'000

£'000

£'000

Cash generated from/(used in) underlying operations

 

7

 

485

 

970

 

1,586

Income tax paid

Income tax received

(115)

-

-

16

(230)

60

 

Net cash from operating activities

 

370

 

986

 

1,416

 

Cash flows from investing activities

Interest received

6

10

18

Net purchase of property, plant and equipment

(138)

(65)

(180)

 

Net cash used in investing activities

 

(132)

(55)

(162)

Cash flows from financing activities

Issue of ordinary share capital

57

-

-

Return of capital

8

(1,800)

-

-

Shares issued from treasury

12

-

53

Shares purchased for treasury

(15)

-

(5)

Dividend paid to shareholders

5

(375)

(366)

(485)

Net cash used in financing activities

 

(2,121)

(366)

(437)

Net (decrease)/increase in cash and cash equivalents

(1,883)

565

817

Cash and cash equivalents at beginning of period/year

2,962

2,256

2,256

Effect of foreign exchange rate changes

 

35

(71)

(111)

Cash and cash equivalents at end of period/year

 

1,114

2,750

2,962

 

The notes on pages 7 to 12 form an integral part of this unaudited condensed consolidated interim report.

 

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT

For the six months ended 30 September 2014

 

1. General information

 

Prime People Plc ("the Company") and its subsidiaries' (together "the Group") principal activity is the provision of permanent and temporary recruitment services to large and medium sized organisations. The Group's focus is to provide services to the built environment sector, the energy and environment sector and for customer insight staff.

 

Prime People Plc is the Group's ultimate parent company. The Company is a limited liability company incorporated and domiciled in the United Kingdom. The address of Prime People Group's registered office and its principal place of business is 2 Harewood Place, London, W1S 1BX, England. Prime People Group's shares are quoted on the Alternative Investment Market (AIM) of the London Stock Exchange.

 

This unaudited condensed consolidated interim report for the six months ended 30 September 2014 (including comparatives) is presented in GBP'000, and was approved and authorised for issue by the board of directors on 7 November 2014.

 

Copies of the interim results are available at the Company's registered office and on the Company's website - www.prime-people.co.uk.

 

This unaudited condensed consolidated interim report does not constitute statutory accounts of the Group within the meaning of section 434 of the Companies Act 2006. The financial information for the year ended 31 March 2014 has been extracted from the statutory accounts for that year, which have been filed with the Registrar of Companies. The auditors' report on those accounts was unqualified and did not contain a statement under section 498 of the Companies Act 2006.

 

2. Basis of preparation

 

The unaudited condensed consolidated interim report for the six months ended 30 September 2014 has been prepared using accounting policies consistent with International Financial Reporting Standards ("IFRSs") and in accordance with 'IAS 34, Interim financial reporting', as adopted by the European Union. The condensed consolidated interim report should be read in conjunction with the annual financial statements for the year ended 31 March 2014 which were prepared in accordance with IFRSs as adopted by the European Union.

 

The Group was profitable for the period and has considerable financial resources comprising £1.1m of net cash at 30 September 2014. After making enquiries, the Directors have formed a judgement, at the time of approving the six months results, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, a period of not less than 12 months. For this reason the Directors continue to adopt the going concern basis in preparing the condensed set of financial statements.

 

These financial statements have been prepared under the historical cost convention, using the same accounting policies as those used in the preparation of the financial statements for the year ended 31 March 2014 and which are also expected to apply for the year ended 31 March 2015. 

 

The accounting policies have been applied consistently throughout the Group for the purposes of preparation of the condensed consolidated interim report.

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT

For the six months ended 30 September 2014

 

3. Segment reporting

 

(a) Revenue and net fee income by geographical region

 

Revenue

Net fee income

Six months ended

Year ended

Six months ended

Year ended

30 September

2014

30 September 2013

31 March 2014

30 September 2014

30 September 2013

31 March 2014

£'000

£'000

£'000

£'000

£'000

£'000

UK

6,228

5,529

11,432

3,198

2,487

5,317

Asia

1,446

917

2,230

1,446

911

2,230

Rest of World

354

364

780

354

364

780

8,028

6,810

14,442

4,998

3,762

8,327

 

 

All revenues disclosed by the group are derived from external customers and are for the provision of recruitment services. The accounting policies of the reportable segments are the same as the Group's accounting policies. Segment profit before taxation represents the profit earned by each segment after allocations of central administration costs.

 

(b) Revenue and net fee income by classification

 

Revenue

Net fee income

Six months ended

Year ended

Six months ended

Year ended

30 September

2014

30 September 2013

31 March 2014

30 September 2014

30 September 2013

31 March 2014

£'000

£'000

£'000

£'000

£'000

£'000

Permanent

- UK

- Asia

- Rest of World

2,833

1,446

354

2,105

917

364

4,548

2,230

780

2,824

1,446

354

2,100

911

364

4,533

2,230

780

Temporary (UK)

3,395

3,424

6,884

374

387

784

 

 

8,028

6,810

14,442

4,998

3,762

8,327

 

(c) Profit before taxation by geographical region

 

Six months ended

Year ended

30 September

2014

30 September 2013

31 March 2014

£'000

£'000

£'000

UK

372

249

719

Asia

248

45

381

Rest of World

14

(7)

(73)

Operating profit

 

634

287

 

1,027

Net finance income

6

10

18

 

Profit before taxation

 

 

640

 

297

 

1,045

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT 

For the six months ended 30 September 2014

 

 

3. Segment reporting (continued)

 

(d) Segment non-current assets by geographical region

 

30 September

2014

30 September 2013

31 March 2014

£'000

£'000

£'000

UK

10,079

10,019

10,062

Asia

62

29

7

Rest of World

 

14

26

28

 

10,155

 

10,074

 

10,097

 

(e) Segment liabilities by geographical region

 

30 September

2014

30 September 2013

31 March 2014

£'000

£'000

£'000

UK

1,351

1,288

1,380

Asia

571

821

656

Rest of World

 

147

136

136

 

2,069

 

2,245

 

2,172

 

 

The analysis above is of the carrying amount of reportable segment assets, liabilities and non-current assets. Segment assets and liabilities include items directly attributable to a segment and include income tax assets and liabilities. Non-current assets include goodwill, property, plant and equipment and computer software.

 

4. Income tax expense

 

The charge for taxation on profits for the interim period amounted to £0.14m (2013: £0.07m) an effective rate of 21% (2013: 23%).

 

 

 

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT 

For the six months ended 30 September 2014

 

5. Dividends

 

Six months ended

Year ended

30 September

2014

30 September

2013

31 March

2014

£'000

£'000

£'000

 

Final dividend for 2014 of 3.09 pence per share (2013: 3.09 pence per share)

 

375

 

366

 

366

Interim dividend for 2014 of 1 pence per share (2013: 1.00 pence per share)

-

-

119

 

 

375

 

366

 

485

 

 

The interim dividend for 2015 of 1.75 pence (2014: 1.00 pence paid on 7 November 2013) was approved by the board on 7 November 2014 and will be paid on 28 November 2014 to those shareholders whose names are on the register on 21 November 2014.

 

6. Earnings per share

 

Earnings per share (EPS) is calculated by dividing the profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the period.

 

Fully diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares by existing share options assuming dilution through conversion of all existing options.

 

Earnings and weighted average number of shares from continuing operations used in the calculations are show below:

 

Six months ended

Year ended

30 September

2014

30 September

2013

31 March 2014

£'000

£'000

£'000

 

Retained profit for basic and diluted earnings per share

 

 

 

505

 

 

230

 

 

842

Number

Number

Number

Weighted average number of shares used for basic earnings per share

 

12,106,942

 

11,860,500

 

11,863,698

Dilutive effect of share options

876,289

345,803

462,126

Diluted weighted average number of shares used for diluted earnings per share

 

 

12,983,231

 

12,206,303

12,325,824

Pence

Pence

Pence

Basic earnings per share

4.17p

 1.94p

7.10p

Diluted earnings per share

3.89p

1.88p

6.83p

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT 

For the six months ended 30 September 2014

 

7. Reconciliation of profit before tax to cash flow from operating activities

 

Six months ended

Year ended

30 September

2014

30 September

2013

31 March

2014

£'000

£'000

£'000

Profit before taxation

640

297

1,045

Adjust for:

Depreciation

79

54

116

Share option reserve movement

53

20

46

Loss on sale of plant and equipment

1

(6)

(2)

Net finance income

(6)

(10)

(18)

Operating cash flow before changes in working capital

 

767

 

355

1,187

(Increase)decrease in receivables

(160)

142

(83)

(Decrease)/increase in payables

 

(122)

473

482

 

Cash generated from underlying operations

 

 

485

 

970

1,586

 

 

8. Return of capital to shareholders

 

At a General Meeting held on 16 June 2014 shareholders approved the return of capital totaling £1.8m. On 16 July 2014 the company announced that the capital reduction had been confirmed by the Court and on the 24 July cheques amounting to 14.809329 pence per share were sent to shareholders. This capital reduction has been treated as an adjustment to share premium.

 

 

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT 

For the six months ended 30 September 2014

 

9. Reconciliation of net cash flow to movement in net funds

 

Six months ended

Year ended

30 September

2014

30 September

2013

31 March

2014

£'000

£'000

£'000

(Decrease)/increase in cash and cash equivalents in period/year

 

(1,883)

 

565

 

817

Net funds at the start of the period/year

2,962

2,256

2,256

Other non-cash changes

35

(71)

(111)

Net funds at the end of the period/year

 

1,114

2,750

2,962

 

 

10. Trade and other receivables

 

30 September

2014

30 September 2013

31 March 2014

£'000

£'000

£'000

Trade receivables

1,982

1,605

1,613

Allowance for doubtful debts

(178)

(122)

(38)

Prepayments and accrued income

1,810

1,744

1,908

Other receivables

1

83

52

 

 

3,695

3,310

 

3,535

 

 

11. Trade and other payables

 

30 September

2014

30 September 2013

31 March 2014

£'000

£'000

£'000

Trade payables

249

317

303

Other taxes and social security

460

392

490

Other payables

222

331

256

Accruals and deferred income

952

958

956

1,883

1,998

2,005

 

 

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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27th Sep 201911:11 amRNSExercise of Options and Transaction in Own Shares
4th Sep 20194:10 pmRNSTransaction in Own Shares
2nd Sep 20193:04 pmRNSDirector/PDMR Shareholding
21st Aug 20191:52 pmRNSExercise of Options and Transaction in Own Shares
12th Aug 20192:20 pmRNSExercise of Options and PDMR Shareholding
24th Jul 201912:26 pmRNSResult of AGM
21st Jun 20197:00 amRNSFinal Results
29th Apr 20194:05 pmRNSDirector/PDMR Shareholding
5th Mar 20194:06 pmRNSTransaction in Own Shares and PDMR Shareholding

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