30th Sep 2014 12:28
LONDON (Alliance News) - Harvey Nash Group PLC Tuesday said first-half pretax profit more than doubled, as the group reported an increase in revenue against the comparative half last year, a period during which it incurred GBP2.3 million of non-recurring costs related to the restructuring of its European outsourcing business.
The group also said it is confident that it remains on track to deliver results in line with current market expectations for the full-year, subject to continued improvement in the market throughout the second-half. It expects the market for executive recruitment and technology professionals to continue its steady recovery.
In a statement Tuesday, the executive search, recruitment and IT outsourcing business said it made a GBP4.2 million pretax profit in the six months ended July 31, compared with GBP1.8 million in the corresponding period last year, as revenue rose by 8.1% to GBP355.9 million. Administrative expenses crept up to GBP39.0 million from GBP38.7 million. Operating profit before non-recurring items increased to GBP4.6 million from GBP4.4 million.
Although revenue increased in the UK & Ireland, Benelux and France, the Nordics, and the US, there were decreases in central Europe and Asia Pacific. In addition, margin pressure resulted in gross profit falls in the Nordics, central Europe and the US. However, there were increases in the UK & Ireland, Benelux and France, and Asia Pacific.
Harvey Nash increased its interim dividend to 1.360 pence from 1.238 pence per share last year.
Harvey Nash, which has operations in the UK and Ireland, mainland Europe, the US and Asia Pacific, said revenue, profit and dividends grew by at least 10% at constant currency. The group's reporting currency, sterling, has appreciated against many other currencies in Harvey Nash's operating regions over the period.
Chief Executive Albert Ellis told Alliance News the group's geographic spread is very important because of the nature of the business and its appeal to investors.
"For us, investors are looking for geographic spread, diversifying exposure form any single economic region. Our clients expect us to have a relatively strong network in major cities across the world when it comes to global recruiting," Ellis said.
The CEO said the group's investment in the UK, USA and parts of Asia provides a strong platform for further growth in the second-half of the year. Ellis also suggested the group may be tempted to make further acquisitions, following on from that of bolt-on Beaumont KK, a recruitment business in Tokyo, Japan, in August.
"It's our second acquisition in Asia, so I wouldn't rule out another," Ellis said.
"We like contracting businesses. We've seen the success they give in Europe. If we were to make a large acquisition it would be in the contracting area," he added.
Ellis told Alliance News there were good signs of economic recovery in the UK, but cautioned that risks remain ahead of next May's General Election. The CEO said it is important that whichever party, or parties, form the next UK government should pursue pro-business and fiscally responsible, deficit-reducing policies. He also wants the UK to remain a part of the EU.
"We're very much on the side of staying in Europe, as we were on the side of Scotland staying in the UK," Ellis told Alliance News. "I think all the arguments are the same. It's better to be part of a larger trading entity right now."
"As a business, we have offices in the UK, Europe and beyond. Any move to isolate the UK or divide Europe would hurt our business," Ellis said.
Harvey Nash shares were Tuesday quoted down 0.3% at 102.23 pence per share.
By Samuel Agini; [email protected]; @samuelagini
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