7 Aug 2014 07:00
7 August 2014
Matchtech Group plc
("Matchtech" or, "the Group")
Trading Update for 12 months ended 31 July 2014
Matchtech Group plc (LSE-AIM: MTEC), the UK's leading specialist engineering and professional services recruitment agency, today provides the following pre-close trading update for the year to 31 July 2014.
The Group has continued to trade well in the second half of the year, with results now expected to be slightly ahead of current market expectations.
The requirement for skilled engineering and technology contract staff remains strong, fuelled by the global demand for the products and services that our clients offer and continued investment in infrastructure programmes. The Group's strong performance has been driven by:
· An 18% increase in Net Fee Income ("NFI") to £45.2 million (FY2013: £38.4 million)
· The placement of higher paid contractors, increases in average contract percentage margin and contractor wage inflation
· Heightened permanent placement activity as the UK economy recovers
· Improved efficiencies within the business
· Strong cash conversion, with Net Debt of £3.0m (2013: £10.6m)
Summary Performance
Change v comparable period | ||||||||
FY 2013 | H1 2014 | H2 2014 | FY 2014 | H1 2014 | H2 2014 | FY 2014 | ||
£m | £m | £m | £m | |||||
Contract NFI | 27.2 | 15.1 | 15.8 | 30.9 | +14% | +13% | +14% | |
Permanent NFI | 11.2 | 6.2 | 6.3 | 12.5 | +17% | +7% | +12% | |
Underlying NFI | 38.4 | 21.3 | 22.1 | 43.4 | +15% | +11% | +13% | |
Provanis1 | - | 0.8 | 1.0 | 1.8 | - | - | - | |
Total NFI | 38.4 | 22.1 | 23.1 | 45.2 | +19% | +16% | +18% | |
Segmental Split | ||||||||
Engineering | 24.0 | 13.3 | 13.8 | 27.1 | +16% | +10% | +13% | |
Professional Services | 14.4 | 8.0 | 8.3 | 16.3 | +14% | +12% | +13% | |
Underlying NFI | 38.4 | 21.3 | 22.1 | 43.4 | +15% | +11% | +13% | |
Provanis1 | - | 0.8 | 1.0 | 1.8 | ||||
Total NFI | 38.4 | 22.1 | 23.1 | 45.2 | +19% | +16% | +18% | |
Business Mix | ||||||||
Contract | 71% | 72% | 73% | 72% | ||||
Permanent | 29% | 28% | 27% | 28% | ||||
Contractors on assignment2 | 7,000 | 7,000 | 7,200 | 7,200 | ||||
Net Debt (£m) 2 | 10.6 | 8.6 | 3.0 | 3.0 | ||||
1 Provanis was acquired in September 2013
2 At end of period
New Banking Arrangements
On 30 July 2014 the Group agreed to transfer its banking relationship to HSBC.
The new agreement is for a three year, £60m Invoice Financing Facility, at a lower rate of 1.1% over HSBC bank base rate.
Preliminary Results
The Group expects to announce its full year results to 31 July 2014, on Tuesday 14 October 2014.
Adrian Gunn, Chief Executive Officer of the Group, commented:
"The Group has continued its track record of delivering year-on-year double-digit growth in Net Fee Income and it is particularly pleasing that contract margins have also again increased.
"There remains very strong demand in the UK and worldwide for skilled engineers and this demand is increasing as the global economy recovers and manufacturing output rises. The Group is ideally placed to benefit from these trends due to our niche focus, market leading position and strong platform based on a balanced business model.
"We therefore continue to invest in order to accelerate the on-going medium term success of the business particularly focussing on increasing our consultant headcount in the first half of FY2015."
- ENDS -
For further information please contact:
Matchtech Group plc | +44 (0) 1489 898989 |
Adrian Gunn, Chief Executive Officer Tony Dyer, Chief Financial Officer
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Newgate Threadneedle - Financial PR | +44 (0) 20 7653 9847 |
John Coles / Fiona Conroy / Edward Treadwell
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Numis Securities Limited | +44 (0) 20 7260 1000 |
Michael Meade / James Serjeant
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About Matchtech
Matchtech Group plc (LSE-AIM: MTEC), is the UK's leading specialist engineering and professional services 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.
The Engineering division spans five specialist sectors - Infrastructure; Automotive, Maritime; Aerospace; Energy - as well as General Engineering. The Professional Services division covers technology markets through our Connectus and Provanis brands and Professional Staffing though our Alderwood and Barclay Meade brands.
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