Last checked at 9 Aug 2013 07:00
RTC Group Plc ("RTC", "the Company" or "the Group")
Interim results for the six months ended 30 June 2013
RTC Group Plc, a support services group which provides recruitment and conferencing services, is pleased to announce its interim results for the six months ended 30 June 2013.
Highlights
·; Group revenue from continuing operations up 14.4% to £23.39m (2012: £20.45m)
·; Group operating profit from continuing operations of £66k (2012: £262k)
·; Profit for the six months attributable to equity holders of £5k (2012: £201k)
·; Profit per share from continued operations of 0.037p (2012: 1.49p)
The Board does not believe that it would be prudent to use its financial resources to recommend a dividend at this time (2012: nil).
Commenting on the results Bill Douie, Chairman, said:
"During the six months ended 30 June 2013, we have taken the opportunity to establish, by internal promotion, an enlarged and enhanced quality middle management team in the ATA Recruitment UK division in order to permit future expansion in staff numbers and business volumes. This has involved the replacement of high performing consultants with new intake and has, as expected, reduced the performance in this division in the six months to 30 June 2013. Accordingly, Group profits in the period are modest at £5k as we build for the future.
The staffing and structural changes in the ATA Recruitment UK division have settled in well and give the directors confidence that a much improved performance for the six months to 31 December 2013 can be achieved. Coupled with solid progress at Global Staffing Solutions Limited and continuing growth at Ganymede Solutions Limited, we remain confident that for the year as a whole, the Company will perform in line with market expectations."
Enquiries:
RTC Group Plc | 01332 861 835 |
Bill Douie, Chairman | |
Andy Pendlebury, Chief Executive | |
Allenby Capital Limited - Nominated Adviser & Broker | 020 3328 5656 |
Jeremy Porter, Corporate Finance | |
Mark Connelly, Corporate Finance |
Chairman's statement
Six months ended 30 June 2013
I am pleased to present the interim report of the Company for the six months ended 30 June 2013.
Group
During the six months ended 30 June 2013, we have taken the opportunity to establish, by internal promotion, an enlarged and enhanced quality middle management team in the ATA Recruitment UK division in order to permit future expansion in staff numbers and business volumes. This has involved the replacement of high performing consultants with new intake and has, as expected, reduced the performance in this division in the six months to 30 June 2013. Accordingly, Group profits in the period are modest at £5k as we build for the future.
Trading
Recruitment
All areas of our recruitment division have performed in accordance with management's expectations in the first half with particularly pleasing results from Ganymede Solutions Limited.
ConferencingThe Derby Conference Centre
The market for conferencing and event activities continues to be slow resulting in a slight deterioration of expected results from this part of the Group.
Central costs
Strict attention to cost control has permitted a limitation of administrative and central costs to substantially the same figure as in the comparable period in 2012.
Management and Board
In January 2013, Andrew Bailey left the Group; we wish him well and thank him for his years of service. Sarah Dye joined us in February 2013 as Group Finance Director and is already making a significant contribution in accounting and administrative matters and to the overall effectiveness of the Group Board team.
Dividends
The directors consider that it would be inappropriate to declare an interim dividend.
Outlook & Strategy
The staffing and structural changes in the ATA Recruitment UK division have settled in well and give the directors confidence that a much improved performance for the six months to 31 December 2013 can be achieved. Coupled with solid progress at Global Staffing Solutions Limited and continuing growth at Ganymede Solutions Limited, we remain confident that for the year as a whole, the Company will perform in line with market expectations.
W J C Douie 8 August 2013
Chairman
Consolidated statement of comprehensive income
Six months ended 30 June 2013
Six month period ended 30 June 2013 Unaudited | Six month period ended 30 June 2012 Unaudited | Year ended 31 December 2012 Audited | ||
Note | £'000 | £'000 | £'000 | |
Revenue | 2 | 23,386 | 20,452 | 42,963 |
Cost of sales | (20,920) | (17,882) | (37,735) | |
Gross profit | 2,466 | 2,570 | 5,228 | |
Administrative expenses | (2,400) | (2,308) | (4,636) | |
Operating profit | 66 | 262 | 592 | |
Financing expense | (61) | (61) | (118) | |
Profit before tax | 5 | 201 | 474 | |
Tax expense | 3 | - | - | 101 |
Net profit and total comprehensive income for the period | 5 | 201 | 575 | |
Earnings per ordinary share | 5 | |||
Basic | 0.037p | 1.49p | 4.26p | |
Diluted | 0.036p | - | - |
There was no dilutive effect of share options at 30 June 2012 or 31 December 2012.
Consolidated statement of changes in equity
Six months ended 30 June 2013
Six months ended 30 June 2013
Share capital | Share premium | Capital redemption reserve | Share based payment reserve | Accumulated losses | Total equity | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 January 2013 (audited) | 135 | 2,468 | 50 | - | (1,482) | 1,171 |
Profit and total comprehensive income for the period | - | - | - | - | 5 | 5 |
Share based payment reserve | - | - | - | 15 | - | 15 |
At 30 June 2013 (unaudited) | 135 | 2,468 | 50 | 15 | (1,477) | 1,191 |
Six months ended 30 June 2012 | ||||||
Share capital | Share premium | Capital redemption reserve | Share based payment reserve | Accumulated losses | Total equity | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 January 2012 (audited) | 135 | 2,468 | 50 | 33 | (2,049) | 637 |
Profit and total comprehensive income for the period | - | - | - | - | 201 | 201 |
Share options cancelled | - | - | - | (33) | 33 | - |
Share based payment reserve | - | - | - | 10 | - | 10 |
At 30 June 2012 (unaudited) | 135 | 2,468 | 50 | 10 | (1,815) | 848 |
Consolidated statement of changes in equity
Six months ended 30 June 2013
Year ended 31 December 2012 | ||||||
Share capital | Share premium | Capital redemption reserve | Share based payment reserve | Accumulated losses | Total equity | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
At 1 January 2012 (audited) | 135 | 2,468 | 50 | 33 | (2,049) | 637 |
Profit and total comprehensive income for the year | - | - | - | - | 575 | 575 |
Share acquisition | - | - | - | - | (41) | (41) |
Share based payment reserve | - | - | - | (33) | 33 | - |
At 31 December 2012 (audited) | 135 | 2,468 | 50 | - | (1,482) | 1,171 |
The share based payment reserve comprises the cumulative share option charge under IFRS 2 less the value of any share options that have been exercised or have lapsed.
Consolidated statement of financial position
As at 30 June 2013
Note | As at 30 June 2013 Unaudited | As at 30 June 2012 Unaudited | As at 31 December 2012 Audited | |
£'000 | £'000 | £'000 | ||
Assets | ||||
Non-current | ||||
Property, plant and equipment | 378 | 271 | 403 | |
Deferred tax asset | 238 | 132 | 239 | |
616 | 403 | 642 | ||
Current | ||||
Inventories | 10 | 11 | 13 | |
Trade and other receivables | 9,092 | 6,471 | 8,059 | |
9,102 | 6,482 | 8,072 | ||
Total assets | 9,718 | 6,885 | 8,714 | |
Liabilities | ||||
Current | ||||
Trade and other payables | (3,642) | (3,150) | (4,034) | |
Current borrowings | 6 | (4,885) | (2,887) | (3,509) |
Total liabilities | (8,527) | (6,037) | (7,543) | |
Net assets | 1,191 | 848 | 1,171 | |
Equity | ||||
Share capital | 135 | 135 | 135 | |
Share premium | 2,468 | 2,468 | 2,468 | |
Capital redemption reserve | 50 | 50 | 50 | |
Share based payment reserve | 15 | 10 | - | |
Accumulated losses | (1,477) | (1,815) | (1,482) | |
Total equity | 1,191 | 848 | 1,171 |
Consolidated statement of cash flows
Six months ended 30 June 2013
Six month period ended 30 June 2013 Unaudited | Six month period ended 30 June 2012 Unaudited | Year ended 31 December 2012 Audited | |
£'000 | £'000 | £'000 | |
Cash flows from operating activities | |||
Operating profit | 66 | 262 | 592 |
Adjustments for: | |||
Depreciation, loss on disposal and amortisation | 94 | 72 | 149 |
Profit on sale of property, plant and equipment | 1 | - | - |
Change in inventories | 3 | 3 | 1 |
Change in trade and other receivables | (1,036) | (27) | (1,621) |
Change in trade and other payables | (382) | 54 | 938 |
Cash generated from operations | (1,254) | 364 | 59 |
Interest paid | (61) | (61) | (118) |
Employee equity settled share options | 15 | 10 | - |
Net cash from/(used) in operating activities | (1,300) | 313 | (59) |
Cash flows from investing activities | |||
Purchases of property, plant and equipment | (76) | (51) | (260) |
Purchases of shares in subsidiary companies | - | - | (41) |
Net cash used in investing activities | (76) | (51) | (301) |
Cash flows from financing activities | |||
Net cash inflow/(outflow) from financing activities | - | - | - |
Net increase/(decrease) in cash and cash equivalents from operations | (1,376) | 262 | (360) |
Total net (decrease) in cash and cash equivalents | (1,376) | 262 | (360) |
Cash and cash equivalents at beginning of period | (3,509) | (3,149) | (3,149) |
Cash and cash equivalents at end of period | (4,885) | (2,887) | (3,509) |
Notes to the interim statement
Six months ended 30 June 2013
1. Accounting policies
a) General information
RTC Group PLC is a public limited company incorporated and domiciled in England whose shares are publicly traded on AIM. The registered office address is The Derby Conference Centre, London Road, Derby, DE24 8UX. The company's registered number is 02558971. The principal activities of the Group are described in note 2.
The Board consider the principal risks and uncertainties relating to the Group for the next six months to be the same as detailed in our last Annual Report and Accounts to 31 December 2012. The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the year ended 31 December 2012.
b) Basis of preparation
The unaudited interim group financial statements of RTC Group PLC are for the six months ended 30 June 2013 and do not comprise statutory accounts within the meaning of S.435 of the Companies Act 2006. The unaudited interim group financial statements have been prepared in accordance with the AIM rules. This report should be read in conjunction with the Group's Annual Report and Accounts for the year ended 31 December 2012, which have been prepared in accordance with IFRS's as adopted by the European Union.
These unaudited interim group financial statements were approved for issue on 8 August 2013. No significant events, other than those disclosed in this document, have occurred between 30 June 2013 and this date.
c) Comparatives
The comparative figures for the year ended 31 December 2012 do not constitute statutory accounts within the meaning of S.435 of the Companies Act 2006, but they have been derived from the audited financial statements for that year, which have been filed with the Registrar of Companies. The report of the auditor was unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006 nor a reference to any matters which the auditor drew attention by way of emphasis of matter without qualifying their report.
d) Accounting policies
The accounting policies adopted are consistent with those described in the annual financial statements for the year ended 31 December 2012. There have been no significant changes in the basis upon which estimates have been determined, compared to those applied at 31 December 2012 and no change in estimate has had a material effect on the current period.
This interim announcement has been prepared based on IFRS's which are in issue that are effective or available for early adoption at the Group's annual reporting date as at 31 December 2013.
2. Segment analysis
The Group is a provider of recruitment and conferencing services and operates a division for each.
The recruitment division comprises three distinct business units - ATA Recruitment UK (ATA UK) servicing the UK SME engineering market and a number of vertical markets; ATA Global Staffing Solutions (ATA GSS) servicing the international market and Ganymede Solutions (GSL) supplying blue collar labour into rail, trades and labour and other markets.
Segmental information is provided below in respect of ATA UK, ATA GSS, GSL and conferencing.
The Group manages the trading performance of each segment by monitoring operating profit before exceptional items and centrally manages working capital, borrowings and equity.
The Conferencing division services are wholly provided in the UK. A growing proportion of the recruitment division revenues now derive from overseas activity.
Revenues are generated from permanent and temporary recruitment in the recruitment division and from the provision of a conferencing and hotel facility in Derby at the Derby Conference Centre (DCC) for the conferencing division.
All revenues have been invoiced to external customers other than £27,000 (2012: £30,000) within the DCC which comprised rental income from other Group segments. During 2013, one customer in the ATA GSS segment contributed greater than 10% of that segment's revenues being £7.3m (2012: £6.5m). Revenues are not seasonal.
The segmental information for the reporting period is as follows:
Conferencing | |||||
ATA UK six month period ended 30 June 2013 | ATA GSS six month period ended 30 June 2013 | GSL six month period ended 30 June 2013 | DCC six month period ended 30 June 2013 | Total group six month period ended 30 June 2013 | |
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
£'000 | £'000 | £'000 | £'000 | £'000 | |
Segment continuing operations | |||||
Sales revenue from external customers | 10,973 | 7,377 | 4,257 | 779 | 23,386 |
Cost of sales | (10,130) | (6,692) | (3,754) | (344) | (20,920) |
Segment gross profit | 843 | 685 | 503 | 435 | 2,466 |
Administrative expenses | (920) | (515) | (375) | (496) | (2,306) |
Depreciation | (33) | (8) | (14) | (39) | (94) |
Segment operating profit | (110) | 162 | 114 | (100) | 66 |
Conferencing | |||||
ATA UK six month period ended 30 June 2012 | ATA GSS six month period ended 30 June 2012 | GSL six month period ended 30 June 2012 | DCC six month period ended 30 June 2012 | Total group six month period ended 30 June 2012 | |
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | |
£'000 | £'000 | £'000 | £'000 | £'000 | |
Segment continuing operations | |||||
Sales revenue from external customers | 9,908 | 6,571 | 3,139 | 834 | 20,452 |
Cost of sales | (8,835) | (5,895) | (2,821) | (331) | (17,882) |
Segment gross profit | 1,073 | 676 | 318 | 503 | 2,570 |
Administrative expenses | (900) | (532) | (315) | (489) | (2,236) |
Depreciation | (20) | (10) | (9) | (33) | (72) |
Segment operating profit | 153 | 134 | (6) | (19) | 262 |
Conferencing | |||||
ATA UK year ended 31 December 2012 | ATA GSS year ended 31 December 2012 | GSL year ended 31 December 2012 | DCC year ended 31 December 2012 | Total group year ended 31 December 2012 | |
Audited | Audited | Audited | Audited | Audited | |
£'000 | £'000 | £'000 | £'000 | £'000 | |
Segment continuing operations | |||||
Sales revenue from external customers | 20,601 | 13,736 | 6,885 | 1,741 | 42,963 |
Cost of sales | (18,292) | (12,472) | (6,228) | (743) | (37,735) |
Segment gross profit | 2,309 | 1,264 | 657 | 998 | 5,228 |
Administrative expenses | (1,982) | (1,141) | (442) | (922) | (4,487) |
Depreciation | (75) | - | (14) | (60) | (149) |
Segment operating profit | 252 | 123 | 201 | 16 | 592 |
All assets and liabilities are held in the United Kingdom.
3. Income tax
No provision has been made for tax in the period as a result of losses brought forward from previous periods.
Deferred tax movements are not considered to be material as to the extent that the deferred tax asset has been released to the statement of comprehensive income, there has been a compensating credit arising as a result of the recognition of a deferred tax asset arising from previously unrecognised tax losses brought forward.
4. Dividends
The Board do not recommend the payment of an interim dividend.
5. Earnings per share
The calculation of basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the year.
The calculation of diluted earnings per share is based on the basic earnings per share adjusted to allow for all dilutive potential ordinary shares.
Basic | Diluted | |||||
Six month period ended 30 June 2013 | Six month period ended 30 June 2012 | Total group year ended 31 December 2012 | Six month period ended 30 June 2013 | Six month period ended 30 June 2012 | Total group year ended 31 December 2012 | |
Unaudited | Unaudited | Audited | Unaudited | Unaudited | Audited | |
£'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
Earnings £'000 | 5 | 201 | 575 | 5 | 201 | 575 |
Weighted average number of shares | 13,511,626 | 13,511,626 | 13,511,626 | 13,906,286 | 13,906,286 | 13,906,286 |
Earnings per share (pence) | 0.037p | 1.49p | 4.26p | 0.036p | - | - |
There was no dilutive effect of share options at 30 June 2012 or 31 December 2012.
6. Analysis of changes in net debt
At 1 January 2013 (Audited) | Cash Flows | Other non- cash movements | At 30 June 2013
(Unaudited) | |||
£'000 | £'000 | £'000 | £'000 | |||
Cash in hand net of bank overdraft and invoice discounting arrangements |
(3,509) |
(1,376) |
- |
(4,885) | ||
Net debt | (3,509) | (1.376) | - | (4,885) | ||
The Group has a working capital facility with HSBC PLC that allows it to borrow up to 90% of the invoiced trade debtors of ATA Recruitment Limited, Ganymede Solutions Limited and ATA Global Staffing Solutions Limited up to £7.0m and an overdraft facility of £50,000.
7. Contingent liabilities
Included in current borrowings are bank overdrafts and an invoice discounting facility. During the year the Group has used its bank overdraft and invoice discounting facility, which is secured by a cross guarantee and debenture over the Group companies. There have been no defaults or breaches of interest payable during the current or prior period.
8. Copies of the interim report
Copies of the interim report will be available on the Company's website later today at www.rtcgroupplc.co.uk.