16th Feb 2011 07:00
Impellam Group plc
REPORT FOR THE 52 WEEKS ENDED 31 DECEMBER 2010
PRELIMINARY RESULTS (UNAUDITED)
Highlights
§ Turnover increased 6.6% to £1,113.6 million (2009: £1,044.2 million)
§ Fees from permanent placements increased 18.4% to £18.7 million (2009: £15.8 million)
§ Conversion of gross profit into operating profit improved to 16.8% (2009: 6.0%)
§ Operating profit £30.7 million (2009: £10.0 million)
§ Cash generation from operating activities increased to £57.5 million (2009: £1.3 million)
§ Net debt decreased by £51.8 million to £17.8 million as at 31 December 2010
§ Basic earnings per share of 46.7p (2009: 23.9p)
Cheryl Jones, Chairman, commented:
"I am extremely pleased to announce that Impellam has produced a strong set of results during the first full year of trading under the Company's defined strategic initiatives.
Key components of the Group's strategic focus for 2010 included end-to-end operating efficiency initiatives, further brand rationalisation, controlled growth strategies and service innovation development for each selected market. As these initiatives developed, their alignment to the overall productivity and efficiency of the business resulted in improved profit and effective cash flow generation.
During 2010, the Group's turnover increased 6.6% to £1.1 billion, principally driven through the Healthcare Staffing and UK Commercial Staffing sectors.
Importantly, conversion of gross profit into operating profit improved over ten basis-points to 16.8% in 2010 from 6.0% in 2009. This improvement reflects the Group's planned approach towards efficiency measures and revenue quality initiatives across all segments.
Operating profit was £30.7 million in 2010, up from £10.0 million in 2009, with all business segments contributing to this performance.
The overall net cash generated from the Group's operations in 2010 was £57.5 million, which allowed net debt to be reduced to £17.8 million at the year-end.
I am also pleased to report that Impellam has recently extended its primary commercial banking facility through to February 2013, and the Company will repay, in full, its final obligations under the £20.0 million guaranteed secured loan notes on the due date in May 2011.
Impellam is now well-positioned to take advantage of market opportunities and improving economic conditions."
Business Segment Results:
− Healthcare Staffing: Turnover increased 13.1% to £202.4 million and gross profit increased by 13.5% to £32.0 million. Operating profit increased to £11.6 million.
− UK Staffing - Commercial: Turnover increased 11.3% to £472.9 million and gross profit increased by 9.5% to £73.6 million. Operating profit increased to £14.9 million.
− UK Staffing - Professional & Technical: Turnover declined 2.9% to £168.1 million and gross profit declined 1.4% to £28.5 million. Operating profit increased to £4.3 million.
− US Staffing: Turnover declined 0.6%* to £164.9 million and gross profit increased by 4.1%* to £34.9 million. Operating profit increased to £4.0 million.
− Support Services: Turnover increased 2.0% to £105.3 million and gross profit increased 37.5% to £13.2 million. Operating profit was £2.4 million compared to a loss in 2009.
The Group generated £57.5 million of cash from operating activities in the year (2009: £1.3 million).
Net debt reduced by £51.8 million to £17.8 million as at 31 December 2010 (31 December 2009: £69.6 million). In addition, the Group has outstanding letters of credit drawn against its US borrowing facilities amounting to £3.4 million (31 December 2009: £4.9 million).
The table below sets out the financial results for the Group by segment for the fifty two weeks to 31 December 2010.
Revenue | Gross profit | Operating profit |
| ||||||
Unaudited | Audited | Unaudited | Audited | Unaudited | Audited |
| |||
£'million | 2010 | 2009 | %change | 2010 | 2009 | %change | 2010 | 2009 | |
Healthcare Staffing | 202.4 | 179.0 | 13.1 | 32.0 | 28.2 | 13.5 | 11.6 | 10.3 | |
UK Staffing - Commercial ^ | 472.9 | 424.7 | 11.3 | 73.6 | 67.2 | 9.5 | 14.9 | 8.4 | |
UK Staffing - Professional & Technical | 168.1 | 173.2 | (2.9) | 28.5 | 28.9 | (1.4) | 4.3 | 3.2 | |
US Staffing | 164.9 | 164.1 | (0.6)* | 34.9 | 33.1 | 4.1* | 4.0 | 0.9 | |
Support Services ^ | 105.3 | 103.2 | 2.0 | 13.2 | 9.6 | 37.5 | 2.4 | (1.1) | |
1,113.6 | 1,044.2 | 6.6 | 182.2 | 167.0 | 9.1 | 37.2 | 21.7 | ||
Central costs | (3.9) | (2.5) | |||||||
Operating profit before amortisation of client relationships and exceptional items | 33.3 | 19.2 | |||||||
Amortisation of client relationships | (2.6) | (3.5) | |||||||
Exceptional items | - | (5.7) | |||||||
Operating profit | 30.7 | 10.0 | |||||||
* measured in local currency
^ Certain prior period costs have been reclassified to conform to the current period presentation with no net impact on operating profit. As part of the on-going review and rationalisation of the Group, certain business activities have been reclassified within the reporting segments. Prior period comparatives have been restated accordingly.
Consolidated income statement
For the fifty two weeks ended 31 December 2010
Unaudited 2010 | Audited 2009 | ||
Notes | £m | £m | |
Restated* | |||
Continuing operations | |||
Revenue | 2 | 1,113.6 | 1,044.2 |
Cost of sales | (931.4) | (877.2) | |
__________ | __________ | ||
Gross profit | 182.2 | 167.0 | |
Administrative expenses | (151.5) | (157.0) | |
__________ | __________ | ||
Operating profit | 2 | 30.7 | 10.0 |
Operating profit before amortisation of client relationships and exceptional items | 33.3 | 19.2 | |
Amortisation of client relationships | (2.6) | (3.5) | |
Exceptional items | - | (5.7) | |
__________ | __________ | ||
Operating profit | 30.7 | 10.0 | |
Finance expense | (3.9) | (4.1) | |
__________ | __________ | ||
Profit before taxation | 26.8 | 5.9 | |
Taxation | 3 | (5.7) | 4.9 |
__________ | __________ | ||
Profit for the period | 21.1 | 10.8 | |
__________ | __________ | ||
* Certain prior period costs have been reclassified to conform to the current year presentation with no net impact on operating profit.
Earnings per share | 4 | Pence | Pence |
Basic and diluted | 46.7 | 23.9 | |
__________ | __________ |
Consolidated statement of comprehensive income
For the fifty two weeks ended 31 December 2010
Unaudited2010 | Audited 2009 | ||
£m | £m | ||
Profit for the period | 21.1 | 10.8 | |
Other comprehensive income: | |||
Gains/(losses) recognised directly in equity | |||
Currency translation differences - net of tax | 0.3 | (0.4) | |
__________ | __________ | ||
Total comprehensive income for the period | 21.4 | 10.4 | |
__________ | __________ | ||
Consolidated balance sheet
Unaudited 31 December 2010 | Audited 31 December 2009 | ||||
£m | £m | ||||
Non-current assets | |||||
Property, plant and equipment | 5.9 | 8.5 | |||
Goodwill | 60.1 | 59.9 | |||
Other intangible assets | 49.4 | 51.3 | |||
Deferred tax asset | 6.1 | 7.5 | |||
Financial assets | 2.5 | 3.5 | |||
_________ | _________ | ||||
124.0 | 130.7 | ||||
_________ | _________ | ||||
Current assets | |||||
Trade and other receivables | 191.9 | 189.7 | |||
Cash and short-term deposits | 13.9 | 9.2 | |||
_________ | _________ | ||||
205.8 | 198.9 | ||||
_________ | _________ | ||||
Total assets | 329.8 | 329.6 | |||
_________ | _________ | ||||
Current liabilities | |||||
Trade and other payables | 163.6 | 136.8 | |||
Taxation liabilities | 2.7 | 1.2 | |||
Bank overdrafts and other borrowings | 11.7 | 58.8 | |||
Short-term borrowings | 20.0 | - | |||
Other financial liabilities | - | 0.2 | |||
Provisions | 3.7 | 4.6 | |||
_________ | _________ | ||||
201.7 | 201.6 | ||||
_________ | _________ | ||||
Net current assets/(liabilities) | 4.1 | (2.7) | |||
_________ | _________ | ||||
Non-current liabilities | |||||
Long-term borrowings | - | 20.0 | |||
Other payables | 1.1 | 0.9 | |||
Provisions | 7.8 | 8.4 | |||
Deferred tax liability | 12.4 | 13.3 | |||
_________ | _________ | ||||
21.3 | 42.6 | ||||
_________ | _________ | ||||
Total liabilities | 223.0 | 244.2 | |||
_________ | _________ | ||||
Net assets | 106.8 | 85.4 | |||
_________ | _________ | ||||
Consolidated balance sheet (continued)
Unaudited 31 December 2010 | Audited 31 December 2009 | ||||||
£m | £m | ||||||
Equity | |||||||
Issued share capital | 0.4 | 0.4 | |||||
Share premium | 15.5 | 15.5 | |||||
_________ | _________ | ||||||
15.9 | 15.9 | ||||||
Other reserves | 93.0 | 92.7 | |||||
Retained deficit | (2.3) | (23.4) | |||||
_________ | _________ | ||||||
Total equity attributable to equity holders of the parent Company | 106.6 | 85.2 | |||||
Non-controlling interest | 0.2 | 0.2 | |||||
_________ | _________ | ||||||
Total equity | 106.8 | 85.4 | |||||
_________ | _________ | ||||||
Consolidated cash flow statement
For the fifty two weeks ended 31 December 2010
Unaudited 2010 | Audited 2009 | ||||
Notes | £m | £m | |||
Cash flows from operating activities | |||||
Cash generated by operations | 5 | 61.6 | 0.8 | ||
Taxation (paid)/refunded | (4.1) | 0.5 | |||
________ | ________ | ||||
Net cash generated by operating activities | 57.5 | 1.3 | |||
________ | ________ | ||||
Cash flows from investing activities | |||||
Cost of acquisition (net of cash acquired) | (0.6) | - | |||
Purchase of property, plant and equipment (PPE) | (2.4) | (3.7) | |||
Purchase of intangible assets | (1.7) | (1.4) | |||
Proceeds from disposal of PPE | 1.0 | - | |||
Net movement in other financial assets | 1.0 | 0.6 | |||
________ | ________ | ||||
Net cash utilised on investing activities | (2.7) | (4.5) | |||
________ | ________ | ||||
Cash flows from financing activities | |||||
Movement in long-term borrowings | (0.1) | (1.4) | |||
Movement in short-term borrowings | (44.5) | 7.6 | |||
Capital element of finance lease payments | (0.2) | (0.2) | |||
Finance expense paid | (3.6) | (3.8) | |||
________ | ________ | ||||
Net cash (outflow)/inflow from financing activities | (48.4) | 2.2 | |||
________ | ________ | ||||
Net increase/(decrease) in cash and equivalents | 6.4 | (1.0) | |||
Opening cash and cash equivalents | 6.5 | 8.6 | |||
Foreign exchange gains/(losses) on cash and cash equivalents | 1.0 | (1.1) | |||
________ | ________ | ||||
Closing cash and cash equivalents | 13.9 | 6.5 | |||
________ | ________ | ||||
31 December 2010 | 31 December 2009 | ||||
Cash and short term deposits | 13.9 | 9.2 | |||
Bank overdrafts | - | (2.7) | |||
________ | ________ | ||||
Cash and cash equivalents | 13.9 | 6.5 | |||
________ | ________ | ||||
Consolidated statement of changes in equity
For the fifty two weeks ended 31 December 2010
Unaudited | |||||
Total share capital and share premium | Other reserves | Retained deficit | Non-controlling interest | Total equity | |
£m | £m | £m | £m | £m | |
1 January 2010 | 15.9 | 92.7 | (23.4) | 0.2 | 85.4 |
______ | ______ | ______ | ______ | ______ | |
Other comprehensive income | - | 0.3 | - | - | 0.3 |
Profit for the period | - | - | 21.1 | - | 21.1 |
______ | ______ | ______ | ______ | ______ | |
| |||||
31 December 2010 | 15.9 | 93.0 | (2.3) | 0.2 | 106.8 |
______ | ______ | ______ | ______ | ______ | |
Notes to the financial statements
1 Basis of preparation
I. Statement of compliance
The financial statements presented in this financial report have been prepared in accordance with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations as endorsed by the European Union that will be applicable to the consolidated financial statements for the year ended 31 December 2010.
II. Financial information
The financial information, which is unaudited, for the fifty two weeks to 31 December 2010 does not constitute the statutory accounts of the Group for the relevant period within the meaning of section 434 of the Companies Act 2006. Such statutory accounts will be completed in due course and delivered to the Registrar of Companies.
III. Accounting policies, new IFRS and interpretations
The accounting policies used in this report are consistent with those applied at December 2009 with the exception of the following new or revised IFRS publications that have been adopted in the period:
International Accounting Standards (IAS / IFRS) | Effective date |
IFRS 3 - Business combinations | 1 July 2009 |
No other new and/or revised IFRS and IFRIC publications that came into force in the period have any impact on the Group.
2 Segmental information
As part of the on-going review and rationalisation of the Group, certain business activities have been reclassified within the reporting segments. Prior period comparatives have been restated accordingly.
Fifty two weeks ended 31 December 2010 - Unaudited
Continuing operations | Healthcare Staffing | UK Staffing - Commercial | UK Staffing -Professional & Technical | USStaffing | Support Services | Group total |
| £m | £m | £m | £m | £m | £m |
| ||||||
Segment revenue | 202.4 | 472.9 | 168.1 | 164.9 | 105.3 | 1,113.6 |
_______ | _______ | _______ | _______ | _______ | _______ | |
| ||||||
Segment EBIT | 11.6 | 14.9 | 4.3 | 4.0 | 2.4 | 37.2 |
_______ | _______ | _______ | _______ | _______ | ||
Unallocated - Corporate cost | (3.9) | |||||
_______ | ||||||
Operating profit before amortisation of client relationships and exceptional items | 33.3 | |||||
Amortisation of client relationships | (2.6) | |||||
Exceptional items | - | |||||
_______ | ||||||
Operating profit before finance costs and taxation | 30.7 | |||||
Finance expense | (3.9) | |||||
_______ | ||||||
Profit before taxation | 26.8 | |||||
Taxation charge | (5.7) | |||||
_______ | ||||||
Profit for the period | 21.1 | |||||
_______ |
Twelve months ended 31 December 2009 - Audited
Continuing operations | Healthcare Staffing | UK Staffing - Commercial | UK Staffing -Professional & Technical | USStaffing | Support Services | Group total |
| £m | £m | £m | £m | £m | £m |
| ||||||
Segment revenue | 179.0 | 424.7 | 173.2 | 164.1 | 103.2 | 1,044.2 |
_______ | _______ | _______ | _______ | _______ | _______ | |
| ||||||
Segment EBIT | 10.3 | 8.4 | 3.2 | 0.9 | (1.1) | 21.7 |
_______ | _______ | _______ | _______ | _______ | ||
Unallocated - Corporate cost | (2.5) | |||||
_______ | ||||||
Operating profit before amortisation of client relationships and exceptional items | 19.2 | |||||
Amortisation of client relationships | (3.5) | |||||
Exceptional items | (5.7) | |||||
_______ | ||||||
Operating profit before finance costs and taxation | 10.0 | |||||
Finance expense | (4.1) | |||||
_______ | ||||||
Profit before taxation | 5.9 | |||||
Taxation credit | 4.9 | |||||
_______ | ||||||
Profit for the period | 10.8 | |||||
_______ |
3 Taxation
|
|
|
| Unaudited 2010 | Audited 2009 |
| £m | £m |
Current income tax |
|
|
UK corporation tax on results for the period | 6.9 | 0.4 |
Adjustments in respect of previous periods | (1.4) | (0.9) |
| ________ | ________ |
| 5.5 | (0.5) |
Foreign tax in the period | 0.3 | 0.6 |
| ________ | ________ |
Total current income tax | 5.8 | 0.1 |
Deferred tax credit | (0.1) | (5.0) |
| ________ | ________ |
Total tax charge/(credit) in the income statement | 5.7 | (4.9) |
________ | ________ |
4 Earnings per share
Basic earnings per share amounts are calculated by dividing the profit for the period attributable to the equity holders of the Company by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings per share amounts are calculated on the same basis, but after adjusting the denominator for the effects of dilutive options. The only potentially dilutive shares arise from the share options issued by the Group under its share-based compensation plans. There are 83,165 options outstanding as at the balance sheet date (2009: 158,998).
The weighted average number of shares has been calculated for the period from 1 January 2010 to 31 December 2010. The number of shares so calculated is 45,029,014 (December 2009: 44,979,041) excluding the shares owned by The Corporate Services Group Employee Share Trust.
5 Reconciliation of profit before tax to cash generated by operations
2010 | 2009 | |
£m | £m | |
Profit before taxation | 26.8 | 5.9 |
Adjustments for: | ||
Finance expense | 3.9 | 4.1 |
Depreciation and amortisation | 8.3 | 8.6 |
Other items | 0.1 | 0.1 |
__________ | __________ | |
39.1 | 18.7 | |
Increase in trade and other receivables | (1.2) | (8.0) |
Increase/(decrease) in trade and other payables | 25.6 | (8.5) |
Decrease in provisions for liabilities and charges | (1.9) | (1.4) |
__________ | __________ | |
Cash generated by operations | 61.6 | 0.8 |
| __________ | __________ |
6 Additional cash flow information
1 January 2010 | Cash flow | Foreign exchange | Othernon-cash changes | 31 December 2010 | |
£m | £m | £m | £m | £m | |
Cash at bank and in hand | 9.2 | 3.7 | 1.0 | - | 13.9 |
Overdrafts | (2.7) | 2.7 | - | - | - |
__________ | __________ | _________ | __________ | __________ | |
6.5 | 6.4 | 1.0 | - | 13.9 | |
__________ | __________ | _________ | __________ | __________ | |
Guaranteed secured loan note | (19.9) | - | - | (0.1) | (20.0) |
Finance leases | (0.3) | 0.2 | - | - | (0.1) |
Revolving credit | (55.9) | 44.6 | (0.3) | - | (11.6) |
_________ | __________ | _________ | __________ | __________ | |
(76.1) | 44.8 | (0.3) | (0.1) | (31.7) | |
__________ | __________ | _________ | __________ | __________ | |
(69.6) | 51.2 | 0.7 | (0.1) | (17.8) | |
__________ | __________ | _________ | __________ | __________ |
Enquiries: For further information please contact the appropriate individual below.
Impellam Group plc |
|
Cheryl Jones, Chairman | Tel: 01582 692658 |
Andrew Burchall, Group Finance Director | Tel: 01582 692658 |
Cenkos Securities plc (Nominated Advisor and Broker to Impellam) |
|
Nicholas Wells Elizabeth Bowman | Tel: 020 7397 8900 Tel: 020 7397 8900 |
Threadneedle Communications |
|
John Coles | Tel: 020 7653 9848 |
Notes:
Impellam Group plc, traded on AIM (Symbol: IPEL), conducts business primarily in the United Kingdom and the United States, with smaller operations in Australia, Ireland, New Zealand and Continental Europe. The Group employs more than 5,600 people, including 2,400 managers and consultants and more than 3,200 support services workers, across a network of 240 branch and regional offices. The Group operates more than 20 specialty brands across a broad range of staffing sectors which are complemented by businesses in the outsourced support services sector. Impellam Group was formed in May 2008 through the merger of The Corporate Services Group plc and Carlisle Group Limited and is ranked 15th on Staffing Industry Analysts' 2010 Top Global Staffing Companies List.
Business Segment | Staffing Sectors/Brands |
Healthcare Staffing | The Group's Healthcare staffing segment comprises Medacs Healthcare (locum doctors, nursing, international recruitment and managed healthcare services) and Chrysalis Homecare (domiciliary care). |
UK Staffing - Commercial
| The Group's UK Commercial staffing segment primarily includes those brands that operate in the traditional clerical, administrative, industrial/trades and hospitality staffing markets. These principal brands include ABC Contract Services (construction and telecoms), Blue Arrow (catering, managed services, office and industrial), Carlisle Managed Solutions (managed services), Comensura (vendor neutral staffing & recruitment procurement), and Tate (office). |
UK Staffing - Professional & Technical
| The Group's UK Professional & Technical staffing segment comprises the following principal brands: Austin Benn (sales and marketing), Celsian Education (teachers and school support staff), Chadwick Nott (legal), Hewitson Walker (accounting), IRC (multi-sector staffing in Ireland), S∙COM (technical) and SRG (scientific). |
US Staffing | The Group's US staffing segment operates across a wide spectrum of staffing sectors. The principal brands and their specialties include CORESTAFF Services and Leafstone (Call centre/customer care, engineering, IT, light industrial, office/clerical, professional, skilled trade and technical), Guidant Group (managed services), InfoCurrent (information/records management and library services), S∙COM (technical and telecom) and SRG Woolf (clinical research). |
Support Services | The Group's Support services segment consists of several brands providing a wide range of outsourced services to clients throughout the UK. These brands include Carlisle Cleaning & Support Services (contract cleaning and facility support services), Carlisle Security (security guarding and CCTV public space surveillance), and the Recruit (retail merchandising and events). |
-END-
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