16th Jun 2015 08:11
LONDON (Alliance News) - Work Group PLC shares were suspended from trading on AIM Tuesday after the company decided to delay publishing its 2014 financial results while it undertakes a strategic review of the business in light of the strain it is experiencing in its working capital.
The recruitment services company said it had experienced a "significant contraction" in its UK business last autumn as a number of client assignments were cancelled or deferred. It said it had won a "significant number" of new UK business assignments since the end of November after making management changes, and had won "encouraging" new business overseas, with its Hong Kong and New York subsidiaries trading profitably.
"Despite these positive trading trends, the losses made in the UK business in the Autumn period, coupled with a lengthening in our customers' working capital cycles, have placed additional operational strain on the company's working capital resources. Significant efforts have been made to reduce our fixed overheads including certain staff redundancies, reducing directors' remuneration and a planned move of our head office this Autumn," it said.
"It is against this background that the board has decided to undertake a strategic review of its operations and appointed SI Partners LLP to work with it on this matter," it added. "The review of the strategic options open to the Company is considering all opportunities for maximising value for shareholders."
Work Group shares last traded at 5.00 pence on June 11.
By Steve McGrath; [email protected]; @stevemcgrath1
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