Half Yearly Report

PENNA CONSULTING PLC

("Penna" or "the Group")

Interim Results for the six months ended 30 September 2014

Penna doubles Earnings per Share in First Half

11 November 2014

Penna Consulting Plc (PNA:AIM), the international human resources consulting group, today announces its unaudited interim results for the six months ended 30 September 2014.

FINANCIAL HIGHLIGHTS

· Operating Profit +92% to £2.1m (2013 : £1.1m)

· Profits after Tax +103% to £1.7m (2013 : £0.8m)

· Net Revenue +21% to £21m (2013 : £17m)

· Earnings per Share +103% to 6.64p (2013 : 3.27p)

· Interim Dividend +33% to 2.0p (2013 : 1.5p)

OPERATIONAL HIGHLIGHTS

· Rapid growth of Recruitment Solutions: Net Revenue +28% to £8.9m and Operating Profit +139% to £1.34m.

· Steady growth of Career Services: Net Revenue +16% to £9.7m and Operating Profit +31% to £1.75m.

Commenting on the results and outlook, Stephen Rowlinson, Chairman, said:

"Penna has completed a very successful first half with Profits after Tax up 103% to £1.7m and Earnings per Share doubled to 6.64p. This has been by far the best first half performance from the Company since the beginning of the recession in 2009.

The business has considerable momentum and we are confident that there will be a satisfactory outcome for the full year."

ENDS

For further information please contact:

Stephen Rowlinson, Chairman 0771 00 23699

Gary Browning, Chief Executive 020 7332 7750

David Firth, Finance Director 020 7332 7754

Charles Stanley Securities

Marc Milmo/Karri Vuori 020 7149 6000

Penna Consulting Plc

Chairman's Review

Penna has completed a very successful first half with Profits after Tax up 103% to £1.7m (2013: £0.8m) and Earnings per Share doubled to 6.64p (2013: 3.27p).

Both major Divisions showed impressive advances of Revenue and Profits. Career Services grew Net Revenue by 16% to £9.7m (2013: £8.3m) and Operating Profit by 31% to £1.75m (2013: £1.33m). Recruitment Solutions benefitted from a further expansion of market share and a recovering UK market to achieve 28% growth of Net Revenue to £8.9m and a very creditable 139% growth of Operating Profit to £1.34m (2013: £0.56m).

Our third UK Division - Talent Management - completed the integration of teams from Penna and Savile and Net Revenue grew by 22% to £2.2m (2013: £1.8m). There was a small Operating Loss of £0.34m (2013: Loss £0.3m). Completion of the restructuring and some important new client wins have set this unit onto a sound growth track and it is on course to make a positive future contribution. Spain, our one remaining overseas operation, produced a further small loss of £0.1m (2013: loss £0.1m) but has embarked on an interesting new project which will ensure a better result in the second half.

Overall, I am pleased to note that the Company has delivered its best first half performance since the beginning of the recession in 2009. As Penna's April to September first half includes the normally quieter summer months these Interim results are very encouraging indeed.

The Savile acquisition has clearly made a positive contribution. We will continue to look for suitable merger opportunities meeting stringent criteria relating to quality of earnings and growth potential.

Penna continues to be cash generative. The Company has no debt and cash at 30 September 2014 was £1.2m (31 March 2014: £0.9m). 50,000 shares were bought in during the period under review and we propose to continue to buy in shares. The Board has declared an Interim Dividend increased by 33% to 2p (2013: 1.5p) and this will be paid on 14 March 2015 to shareholders on the register on 13 February 2015.

Divisional Breakdown

*includes Belfast which was discontinued in 2H of 2013/14

Operating Review

Following the acquisition of the Savile Group Plc in December 2013 the company is organised under three service groups in the UK: Recruitment Solutions, Talent Management and Career Services and an operation in Spain.

Each service group has a managing director reporting to the Chief Executive and a senior management team with full profit and loss responsibility.

This operating structure reflects the Penna market proposition of supporting clients in all areas of the HR function and throughout the employment lifecycle of Recruitment, Development and Transition of employees.

In the period we have seen high levels of change across all sectors and it is this change dynamic which drives activity for all Penna services.

Recruitment Solutions at Penna combines our service capabilities in recruitment communications, managed recruitment & assessment, executive search and executive interim. This portfolio of expertise enables us to offer innovative solutions to the recruitment needs of over 350 clients across commercial and public sectors.

First half net revenues (net fee income or NFI) increased by 28% to £8.9m and operating profits improved by a very significant 139% to £1.34m (2013: £0.56m).

The increasing pipeline of new recruitment contracts reported at this point last year has continued and accelerated. We have gained important new clients and we have broadened the range of services we offer to them.

Penna is a solutions oriented recruitment business and we see rapidly changing technology as a major opportunity. One example is our use of 'Gamification' - the use of computer game technology and user interfaces in a business environment. For KPMG we produced an award winning and highly creative online development tool using gaming technology to support graduate recruitment and development. Such innovative developments are essential for our clients to win the battle for talent.

All areas within our recruitment business have grown. Recruitment communications grew by 38%, Managed recruitment & assessment by 45%, Executive search by 25% and Executive interim by 67%.

The Talent Management business combines Penna's consulting and development teams with the Cedar part of Savile. The enlarged division offers assessment and development services to clients including executive and team assessment tools and processes, board coaching, leadership and management development.

Post-recession investment in this area is significant with major employers regarding leadership development as a number one HR priority. In a period of growth, the ability to identify, develop and measure capability and potential is critical. In the last year we have assessed over 2,000 individuals and coached over 590 leaders and managers, of which 250 were board directors. Major clients of the division include KPMG, Airbus, Barclays, Santander and Network Rail.

The Talent Management division within Penna is currently smaller than the Recruitment Solutions and Career Services. Net Revenue in the period increased by 22% to £2.15m and there was a loss of £0.34m (2013: £0.3m). We are confident that this division will soon become a third significant profit contributor.

Career Services is the group of services in Penna targeted at providing clients with advice, guidance and consultancy on career direction. It includes the UK's market leading outplacement consultancy together with the newer career development and redeployment services.

In August 2014, we were proud to celebrate the 40th anniversary of the founding of the company and our career services offering. Since foundation, we have supported over one million individuals as they made the transition from one phase of their career to another. We were the first in Europe to offer outplacement services and we remain the most innovative company in the sector.

Net Revenue increased by 16% to £9.7m in the six months to 30 September 2014 (2013: £8.3m). Operating profit in the period increased by 31% to £1.75m (2013: £1.33m).

To complement the outplacement offering in this period we launched two new services. A Career Development service aimed at companies concerned about employee retention and motivation in a growth period. The service combines leading edge career technology with face-to-face coaching and workshop support, and can be sold as a standalone technology product or as a delivered service. We have been delighted with the early market response to this innovative new service and have secured the first major two year contract with a leading retailer.

The second new career service introduced this year is redeployment of employees, within their existing employer, from potentially redundant roles into new areas. This requires a balance of robust systems and processes, an appreciation of business requirements and a culture of acceptance. Where these three ingredients are present and redeployment is embraced multi-million pound savings can be achieved.

Outlook

This has been by far the best first half performance by the Company since the beginning of the recession in 2009. The business has considerable momentum and we are confident that there will be a satisfactory outcome for the full year

Stephen Rowlinson

Chairman

11 November 2014

Unaudited condensed consolidated interim statement of comprehensive income

for the six months ended 30 September 2014

Penna Consulting Plc

Unaudited condensed consolidated interim statement of changes in equity

at 30 September 2014

Penna Consulting Plc

Unaudited condensed consolidated interim statement of financial position

at 30 September 2014

Penna Consulting Plc

Unaudited condensed consolidated interim statement of cash flow

for the six months ended 30 September 2014

Penna Consulting Plc

Notes to the unaudited condensed consolidated interim report

for the six months ended 30 September 2014

1. Basis of preparation

The unaudited condensed consolidated interim report for the period ended 30 September 2014 has been prepared under the historical cost convention, using accounting policies that are consistent with current International Financial Reporting Standards (IFRS) as endorsed by the European Union and also comply with IFRIC interpretation and Common Law applicable to companies reporting under IFRS. The condensed consolidated interim report should be read in conjunction with the annual financial statements for the year ended 31 March 2013, which were prepared in accordance with IFRS, as adopted by the European Union.

The unaudited condensed consolidated interim report has been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year ended 31 March 2013 and applied consistently throughout the Group.

3. Earnings per share

The calculation of basic and diluted earnings per share is based on the following amounts: