3rd Apr 2019 09:07
LONDON (Alliance News) - Gattaca PLC said Wednesday its interim profit performance improved markedly after revenue rose and costs fell, though the firm did axe its half-year payout amid a new dividend policy.
Shares in Gattaca were 20% higher at 140.00 pence on Wednesday.
For the six months ended January, the recruitment software firm swung to a GBP5.4 million profit from a GBP13.6 million loss the year prior. This was after revenue rose 5.6% to GBP322.3 million from GBP305.3 million the year before.
Profit performance was helped by a sharp fall in administrative expenses to GBP30.0 million from GBP48.3 million the year prior. This was primarily due to GBP18.7 million in acquired intangibles amortisation being booked the year prior, compared to just GBP632,000 in the most recent period.
Underlying pretax profit - excluding one-off costs - widened 11% to GBP6.8 million from GBP6.1 million the year before.
"The first half of financial 2019 has been a period of progress for the group and we are pleased to be reporting net fee income and pretax profit growth in our continuing operations," Gattaca Chief Executive Officer Kevin Freeguard said.
Net fee income expanded 1.4% to GBP36.5 million from GBP36.0 million a year prior.
"Our core UK Engineering business delivered continued growth and the restructuring work we undertook in our UK Technology operations in the first quarter has begun to feed through into an improved year-on-year operating contribution," Freeguard added. "Our restructured and refocused International operations continued to grow strongly and we are pleased with our progress in reducing net debt."
"Building on the fundamental strengths of the business, our improvement plan is now underway and is focussing on the levers for growth, refining sales and market effectiveness, aligning operations to further enhance our delivery capability and innovating to extend our range of market solutions," Freeguard said. "I am confident that as we continue to execute the plan it will position the company well for the future."
Gattaca axed its interim dividend, having paid a 3.0 pence interim distribution the year prior. This was in line with its new adjusted dividend policy. The firm will consider a dividend payment at the end of the full year, but if resumed it will be at "modest levels."
Gattaca added that "economic uncertainty, which can impact our industry, has increased over the last six months. Notwithstanding this, trading so far in the third quarter is as expected and we remain confident in our outlook for the full year; we expect results to be in line with the board's expectations at this time."
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