4th Jul 2014 08:16
LONDON (Alliance News) - Management Consulting Group PLC said Friday that its outlook remains broadly in line with overall for the full-year, while the strengthening of sterling is expected to result in the group reporting first-half revenues at a similar level to the first-half of 2013.
In a pre-close statement ahead of the company's full-year results July 31, 2014, the professional services group said it continues to perform in line with its expectations and that both the Alexander Proudfoot and Kurt Salmon businesses have increased revenues on a constant currency basis, despite the strengthening of sterling.
Management Consulting Group said that more than a third of its revenues are derived from US dollars and around half our revenues generated in euros, and that subsequently its reported numbers are influenced by currency translation.
The Kurt Salmon division had a good start to 2014 and this continued into the second quarter, said the company. It also noted that the current order book and pipeline are encouraging at this stage of the year.
Alexander Proudfoot has had a slow start to the year, said the firm, and has been hit by currency headwinds. "Reported first half revenues in 2014 are expected to slightly exceed those in the same period last year, but will not match those reported in the second half of 2013," said Management Consulting Group, which added that it is making good progress with change initiatives in the division announced earlier in the year.
While good recent order input means that the order book is currently higher than it was at the same time last year, the company said it retains a cautious view on the outlook for Alexander Proudfoot for 2014 as a whole.
The first-half of the year is typically not cash generative as a result of the timing of the payment of the group's annual bonuses from the previous financial year, it said. Due to this net indebtedness has increased at the 2014 half-year compared to the end of 2013, as in previous years. Reported net debt at the half-year is likely to be approximately GBP48 million, said the company.
Looking ahead, Management Consulting Group said it continues to focus on operational cash generation to further reduce net indebtedness over the course of the current financial year.
In April Management Consulting said its outlook remained in line with that reported in its preliminary results statement on March 6, when Chief Executive Nick Stagg said the firm expects underlying revenue growth and improved operating margins in 2014.
Shares in the company were trading 1.55% lower at 23.75 pence per share Friday morning.
By Alice Attwood; [email protected]; @AliceAtAlliance
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