PRP.L Regulatory News (PRP)

28th October 2015

Prime People Plc

Unaudited Condensed Consolidated Interim Report

 for the six months ended 30 September 2015

CHAIRMAN'S STATEMENT

Overview

The Group is pleased to report strong uplift in Operating Profit to £1.06m in the first half of this year compared to £0.63m achieved in the comparable period last year. The growth in the period has been generated from our permanent business, which represents 92% of Net Fee Income (NFI) compared to 93% in the comparable period of 2014. During the period our contract recruitment business has grown by 32%.

The improvement in performance highlighted in our 2015 Annual Report has continued throughout the current period. NFI in the period for the Group is £6.21m which is a 24% increase on last year (2014: £5.00m). There were a number of strong NFI performances in both the UK and Asia. In the UK NFI increased by 22% from £3.2m to £3.9m and in Asia NFI increased by 36% from £1.4m to £1.9m.

Financial Results

Group revenue increased by 27.5% for the period to £10.2m (2014: £8.0m)

Administrative costs for the group have increased from £4.4m in 2014 to £5.2m in the current period which is in part a consequence of higher commission paid to consultants for improved performance and in part an uplift in fee earning head-count of the Group.

Profit before taxation for the period has increased to £1.06m (2014: £0.64m)

The charge for taxation is based on the expected annual effective tax rate of 20% (2014: 21%).

Basic earnings per share for the period increased to 6.97p (2014: 4.17p).

Cash Flow

The Group continues to maintain a strong net cash position.

After taxation payments of £0.20m (2014: £0.01m) cash generated from operations was £1.00 (2014: £0.37m). A special second interim dividend was paid in April 2015 of £0.49m, and a final dividend for 2015 of £0.38m was paid in June 2015 (2014: £0.38m). At the end of the period the Group had net cash of £1.04m (2014: £1.11m)

Dividend

The Board has declared an interim dividend of 1.75p (2015: 1.75p) together with a special second interim dividend of 4.00p (2015: 4.00p). Both, interim and special dividend will be paid on 27 November 2015 to those shareholders whose names are on the register on 20 November 2015.

Outlook

We have expectations that the UK businesses will 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. We continue to have conservative expectations as to the likely performance from our businesses in the Rest of the World. We believe we are well positioned to capitalise on both current and future growth opportunities.

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

Robert Macdonald

Executive Chairman

28 October 2015

For further information please contact:

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 30 September 2015

The above results relate to continuing operations.

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

As at 30 September 2015

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2015

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOW

For the six months ended 30 September 2015

PRIME PEOPLE PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT

For the six months ended 30 September 2015

1. General information

Prime People Plc ('the Company') and its subsidiaries (together 'the Group') is an international recruitment services organisation with offices in the United Kingdom, the Middle East and the Asia Pacific region from which it serves an international client base. The Group offers both permanent and contract specialist recruitment consultancy for large and medium sized organisations.

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. The registered number of the company is 1729887.

This unaudited condensed consolidated interim report for the six months ended 30 September 2015 (including comparatives) is presented in GBP'000, and was approved and authorised for issue by the board of directors on 27 October 2015.

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 2015 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 2015 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 2015 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 £1.04m of net cash at 30 September 2015. 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 2015 and which are also expected to apply for the year ended 31 March 2016.

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

3. Segment reporting

(a) Revenue and net fee income by geographical region

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

(c) Profit before taxation by geographical region

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 £0.22m (2014: £0.14m) an effective rate of 20% (2014: 21%).

5. Dividends

The interim dividend for 2016 of 1.75 pence (2015: 1.75 pence paid on 28 November 2014), and a special second interim dividend of 4.0p (2015: 4.00 pence paid on 2 April 2015) was approved by the board on 27 October 2015 and will be paid on 27 November 2015 to those shareholders whose names are on the register on 20 November 2015.

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:

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

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

9. Trade and other receivables

10. Trade and other payables