4th Jun 2014 07:40
LONDON (Alliance News) - Servoca PLC Wednesday said its interim pretax profit more than doubled, as higher revenue more than offset rising administrative expenses, but the specialist recruiter and outsourcing company noted pressure on margins in some areas of its business.
In a statement, Servoca, which recruits in education, healthcare and police, as well as offering security outsourcing, said it made a GBP337,000 pretax profit in the six months ended March 31, compared with GBP151,000 in the corresponding period a year earlier. Revenue increased to GBP22.4 million from GBP21.5 million, while administrative expenses grew to GBP5.9 million from GBP5.6 million.
"Our education and nursing recruitment operations are performing well and carry good momentum into the second half of the year. Full year profitability is expected to significantly benefit from the pivotal September period for our education businesses," Chief Executive Andy Church said in a statement.
The rise in pretax profit was largely due to Servoca's recruitment operations, driven by its education businesses, followed by its nursing businesses. In police recruitment, Servoca said that revenue and operating profit improved over the same period in the prior year, but noted that the business has come under increased pressure on margins.
The outsourcing business had a mixed first half to the year, with the domiciliary care business showing improved profitability, but the security business seeing a reduction in both revenue and profitability due to pressure on gross margins in the manned guarding sector.
Servoca said its strategy is to build electronic security and event security offerings which have strong gross margins, adding that the second half will benefit from "a significant volume of work" at the Commonwealth Games in Glasgow which begin in July.
Servoca shares were Wednesday quoted at 15.30 pence, down 8.7%.
By Samuel Agini; [email protected]; @samuelagini
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