19 Nov 2009 07:00
19 November 2009
Prime People PlcInterim Results for the six months ended 30 September 2009
Prime People Plc ("Prime People" or the "Group"), the international real estate, infrastructure and commercial property recruitment specialist, today announces its interim results for the half year ended 30 September 2009.
Highlights:
| | Six months ended 30 September 2009 | Six months ended 30 September 2008 |
| | | |
| Gross fee income | £7.07m | £12.09m |
| Net fee income | £3.05m | £6.68m |
| Operating (loss)/profit before non-recurring costs Pre-tax (loss)/profit | £(0.05)m £(0.16)m | £1.01m £0.99m |
| Diluted (loss)/earnings per share | (1.10)p | 5.36p |
Peter Moore Managing Director of Prime People, commented:
"On the basis that the worst outcome of the global financial crisis has been averted Prime People with its strong UK position and established overseas offices is ready and able to capitalise on the opportunities that the coming months may offer".
-Ends-
For further information please contact:
| Prime People | 020 7318 1785 |
| Robert Macdonald, Executive Chairman | |
| Chris Heayberd, Finance Director | |
| Cenkos Securities | 020 7397 8900 |
| Nick Wells Elizabeth Bowman | |
| Julian Morse |
Prime People plcInterim Results for the six months ended 30 September 2009
Chairman's Statement
Results
I am able to report the results for Prime People Plc for the half-year ended 30 September 2009.
The first half shows an operating loss of £46,000 before deduction of non-recurring items of £116,000. Whilst this contrasts unfavourably with the operating profit of £1.013 million produced in the comparable period last year, it contrasts well with the immediately preceding half year when the group recorded operating losses of £263,000.
During the period being reported the Group has continued to rationalise its management and organisation to reflect the level of business it expects to do in the remainder of the current financial year and is now positioned to be profitable in the second half of the year on the basis of the budgeted level of net fee income. The results reflect the challenging global market conditions in all our markets during the period being reported and the impact of redundancy costs of £116,000 associated with ensuring that the Group is the right size for the immediate future.
The net fee income split is:
| | | Six months ended 30 September 2009 | Six months ended 30 September 2008 | ||
| | | £'000 | £'000 | ||
| Permanent - UK - International | | 1,337 953 | 3,336 2,207 | ||
| Temporary (UK only) | 2,290 760 | 5,543 1,137 | |||
| Total | 3,050 | 6,680 | |||
| | | | | | |
Net cash
The Group retains a strong net cash position of £1.81million (2008: £1.07million) and is positioned to be able to exploit both cyclical opportunities that may present themselves and the upturn in its markets when they come.
Dividend
The Board has decided not to declare an interim dividend for the six months ended 30 September 2009 but will give consideration to recommending a final dividend once the outcome for the full year is known.
Outlook
In recent months trading in all offices has reached a level at which revenues appear to be stabilising and from which good progress can be made.
The Group's overseas offices continued to contribute significantly to Group NFI providing 31 per cent of Group NFI (2008: 33 per cent).
Freelance (temporary placement) activity also continues to provide a material part of the Company's revenue mix contributing 25 per cent of Group NFI (2008: 17 per cent) in the period.
Prime Insight, the Company's business which specialises in the placement of insight professionals and which we started in October last year, continues to make steady progress. This start-up and incubation provides a business model from which to grow new recruitment businesses and we are actively looking for similar opportunities.
With signs of a general, if modest, economic recovery in global activity and an increased interest in property as a yielding asset class noticeable in the UK and Far East I hope to report improved performance in the second half of the year.
R J G Macdonald
Executive Chairman
19 November 2009
Consolidated income statement
for the six months ended 30 September 2009 (unaudited)
| | Notes | | Six months ended 30 September 2009 | | Six months ended 30 September 2008 | | Year ended 31 March 2009 |
| | | | £'000 | | £'000 | | £'000 |
| | | | | | | | |
| Continuing operations | | | | | | | |
| | | | | | | | |
| Gross Fee Income | | | 7,071 | | 12,089 | | 20,668 |
| Direct costs | | | (4,021) | | (5,409) | | (10,255) |
| | | | | | | | |
| Net fee income | | | 3,050 | | 6,680 | | 10,413 |
| Administrative expenses | | | (3,212) | | (5,667) | | (9,663) |
| | | | | | | | |
| Operating (loss)/profit | | | (162) | | 1,013 | | 750 |
| | | | | | | | |
| Finance income | | | 5 | | 6 | | 14 |
| Finance expense | 2 | | (5) | | (25) | | (37) |
| | | | | | | | |
| | | | | | | | |
| (Loss)/profit before taxation | | | (162) | | 994 | | 727 |
| | | | | | | | |
| Taxation | | | 31 | | (301) | | (190) |
| | | | | | | | |
| | | | | | | | |
| (Loss)/profit after tax attributable to equity shareholders | | | (131) | | 693 | | 537 |
| | | | | | | | |
| | | | | | | | |
| Earnings per share | 5 | | | | | | |
| Basic | | | (1.10)p | | 5.76p | | 4.47p |
| Diluted | | | (1.10)p | | 5.36p | | 4.18p |
| | | | | | | | |
Consolidated statement of changes in shareholders equity at 31 March 2009
for the six months ended 30 September 2009 (unaudited)
| | Called up share capital | Capital redemption reserve | Share premium account | Other reserve | Share option reserve | Foreign currency translation | Retained earnings | Total |
| | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 |
| At 1 April 2008 | 1,203 | - | 7,095 | 173 | 136 | (15) | 4,087 | 12,679 |
| Currency translation difference | - | - | - | - | - | 130 | - | 130 |
| Profit for the period | - | - | - | - | - | - | 693 | 693 |
| Adjustment in respect of share schemes | - | - | - | - | 29 | - | - | 29 |
| Equity dividends | - | - | - | - | - | - | (289) | (289) |
| | | | | | | | | |
| At 30 September 2008 | 1,203 | - | 7,095 | 173 | 165 | 115 | 4,491 | 13,242 |
| | | | | | | | | |
| Currency translation differences | - | - | - | - | - | 371 | - | 371 |
| Loss for the period | - | - | - | - | - | - | (156) | (156) |
| Adjustment in respect of share schemes | - | - | - | - | 11 | - | - | 11 |
| | | | | | | | | |
| At 31 March 2009 | 1,203 | - | 7,095 | 173 | 176 | 486 | 4,335 | 13,468 |
| | | | | | | | | |
| Currency translation differences | - | - | - | - | - | (82) | - | (82) |
| Loss for the period | - | - | - | - | - | - | (131) | (131) |
| Adjustment in respect of share schemes | - | - | - | - | (107) | - | 113 | 6 |
| Shares purchased for cancellation | (9) | 9 | (18) | - | - | - | - | (18) |
| | | | | | | | | |
| At 30 September 2009 | 1,194 | 9 | 7,077 | 173 | 69 | 404 | 4,317 | 13,243 |
Consolidated balance sheet
at 30 September 2009 (unaudited)
| | | As at 30 September 2009 | | As at 30 September 2008 | | As at 31 March 2009 |
| | | £'000 | | £'000 | | £'000 |
| | | | | | | |
| Assets | | | | | | |
| Non-current assets | | | | | | |
| Intangible assets | | 9,769 | | 9,769 | | 9,769 |
| Property, plant and equipment | | 298 | | 376 | | 379 |
| Deferred tax asset | | 79 | | 66 | | 49 |
| | | | | | | |
| | | 10,146 | | 10,211 | | 10,197 |
| | | | | | | |
| Current assets | | | | | | |
| Trade and other receivables | | 2,863 | | 4,673 | | 3,351 |
| Cash and cash equivalents | | 2,237 | | 1,780 | | 2,499 |
| | | | | | | |
| | | 5,100 | | 6,453 | | 5,850 |
| | | | | | | |
| Total assets | | 15,246 | | 16,664 | | 16,047 |
| | | | | | | |
| Liabilities | | | | | | |
| Current Liabilities | | | | | | |
| Financial liabilities - borrowings | | 288 | | 290 | | 429 |
| Trade and other payables | | 1,575 | | 2,179 | | 1,848 |
| Current tax liabilities | | - | | 533 | | 22 |
| | | | | | | |
| | | 1,863 | | 3,002 | | 2,299 |
| Non current liabilities | | | | | | |
| Financial liabilities - borrowings | | 140 | | 420 | | 280 |
| | | | | | | |
| | | | | | | |
| Total liabilities | | 2,003 | | 3,422 | | 2,579 |
| | | | | | | |
| Net assets | | 13,243 | | 13,242 | | 13,468 |
| | | | | | | |
| | | | | | | |
| Capital and reserves | | | | | | |
| Called up share capital Capital redemption reserve | | 1,194 9 | | 1,203 - | | 1,203 - |
| Share premium account | | 7,077 | | 7,095 | | 7,095 |
| Other reserve | | 173 | | 173 | | 173 |
| Share option reserve | | 69 | | 165 | | 176 |
| Currency translation differences | | 404 | | 115 | | 486 |
| Retained earnings | | 4,317 | | 4,491 | | 4,335 |
| | | | | | | |
| Equity shareholders funds | | 13,243 | | 13,242 | | 13,468 |
| | | | | | | |
Consolidated Cash Flow Statement
for the six months ended 30 September 2009 (unaudited)
| | Notes | Six months ended 30 September 2009 | Six months ended 30 September 2008 | Year ended 31 March 2009 | |||
| | | | £'000 | | £'000 | | £'000 |
| | | | | | | | |
| Cash inflow from operating activities | | | | | | | |
| Cash generated by operations | 6 | | 14 | | 1,953 | | 3,187 |
| Corporation tax received /(paid) | | | 34 | | (248) | | (631) |
| | | | | | | | |
| Net cash from/(used) in operating activities | | | 48 | | 1,705 | | 2,556 |
| | | | | | | | |
| Cash flows from investing activities | | | | | | | |
| Interest received | | | 5 | | 6 | | 14 |
| Interest paid | | | (5) | | (25) | | (37) |
| Net purchase of property, plant and equipment | | | (12) | | (163) | | (290) |
| | | | | | | | |
| Net Cash used in investing activities | | | (12) | | (182) | | (313) |
| | | | | | | | |
| Cash flows from financing activities | | | | | | | |
| Repayment of borrowings | | | (140) | | (140) | | (280) |
| Dividends paid to shareholders | | | - | | (289) | | (289) |
| Shares purchased for cancellation | | | (18) | | - | | - |
| | | | | | | | |
| Net cash used in financing activities | | | (158) | | (429) | | (569) |
| | | | | | | | |
| Net (decrease) / increase in cash and cash equivalents | | | (122) | | 1,094 | | 1,674 |
| | | | | | | | |
| Cash and cash equivalents at 1 April 2009 | | | 2,350 | | 676 | | 676 |
| | | | | | | | |
| Cash and cash equivalents at 30 September 2009 | | | 2,228 | | 1,770 | | 2,350 |
| | | | | | | | |
Notes to the Interim Financial Statements
For the six months ended 30 September 2009 (unaudited)
1. Accounting Policies
The consolidated interim financial statements are for the six months ended 30 September 2009. They have been prepared in accordance with International Financial Reporting Standards (IFRS) using the same accounting policies as those used in the preparation of the accounts for the year ended 31 March 2009.
2. Finance Expense
| | Six months ended 30 September 2009 | Six months ended 30 September 2008 | Year ended 31 March 2009 | |||
| | | £'000 | | £'000 | | £'000 |
| Bank interest: | | 5 | | 25 | | 37 |
| | | 5 | | 25 | | 37 |
| | | | | | | |
3. Taxation on profit on ordinary activities
Taxation has been provided by applying the standard rate of corporation tax in the UK.
4. Dividends
| Six months ended 30 September 2009 | Six months ended 30 September 2008 | Year ended 31 March 2009 | ||||
| £'000 | £'000 | £'000 | ||||
| Final dividend for 2008 of 2.40 pence per share | - | 289 | 289 | |||
| - | 289 | 289 | ||||
Notes to the Interim Financial Statements (continued)
for the six months ended 30 September 2009 (unaudited)
5. Earnings per share
Earnings per share (EPS) has been calculated in accordance with IAS 33 "Earnings per share" and is calculated by dividing the profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the period.
Earnings and weighted average number of shares used in the calculations are show below:
| | Six months ended 30 September 2009 | Six months ended 30 September 2008 | Year ended 31 March 2009 | |||
| | | £'000 | | £'000 | | £'000 |
| Retained (loss)/profit for basic earnings per share | | (131) | | 693 | | 537 |
| | | | | | | |
| | | | | | | |
| | | Number | | Number | | Number |
| | | | | | | |
| Weighted average number of shares used for basic and continuing earnings per share | | 11,941,500 | | 12,028,899 | | 12,028,899 |
| Dilutive effect of share options and shares to be issued | | 841,510 | | 902,621 | | 835,156 |
| | | | | | | |
| Diluted weighted average number of shares used for diluted earnings per share | | 12,783,010 | | 12,931,520 | | 12,864,055 |
| | | | | | | |
Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has only one category of dilutive potential ordinary shares: share options. The basic and diluted loss per share is the same, as the exercise of share options would reduce the loss per share and is, therefore, anti-dilutive.
| | | Pence | | Pence | | Pence |
| | | | | | | |
| Basic (loss)/earnings per share | | (1.10)p | | 5.76p | | 4.47p |
| Diluted (loss)/earnings per share | | (1.10)p | | 5.36p | | 4.18p |
| | | | | | | |
6. Reconciliation of operating profit to net cash inflow from operating activities
| | | Six months ended 30 September 2009 | | Six months ended 30 September 2008 | | Year ended 31 March 2009 | | |
| | | £'000 | | £'000 | | £'000 | | |
| | | | | | | | | |
| | Group operating (loss)/profit | | (162) | | 1,013 | | 750 | |
| | | | | | | | | |
| | Depreciation | | 93 | | 100 | | 224 | |
| | Share option reserve movement | | 6 | | 29 | | 40 | |
| | Effects of exchange rate changes | | (82) | | 130 | | 501 | |
| | Decrease in debtors | | 487 | | 1,078 | | 2,400 | |
| (Decrease)/increase in creditors | | (328) | | (397) | | (728) | | |
| | | | | | | | | |
| Net cash inflow from operating activities | | 14 | | 1,953 | | 3,187 | | |
| | | | | | | | | |
7. Nature of the financial information
The interim financial information for the six months ended 30 September 2009, was approved by the board on 19 November 2009.
The financial information set out above does not constitute full accounts within the meaning of Section 240 of the Companies Act 1985. The comparative results for the year ended 31 March 2009 have been extracted from the Group's financial statements for that period which have received an unqualified audit report and have been filed with the Registrar of Companies.
A copy of the interim results will be available on the company's website www.prime-people.co.uk