Half Yearly Report

PENNA CONSULTING PLC

("Penna" or "the Group")

Interim Results for the six months ended 30 September 2012

13 November 2012

Penna Consulting Plc (PNA:AIM), the international human resources consulting group, today announces its interim unaudited results for the six months ended 30 September 2012.

FINANCIAL HIGHLIGHTS

·; Revenue £33.1m (2011: £34.2m) and net revenues £19.5m (2011: £18.9m)

·; Pre tax profits £0.8m (2011: £0.8m)

·; Cash at period end £1.5m (2011: £1.7m)

·; Earnings per share 2.4p (2011: 2.4p)

·; Interim dividend 1p (2011: 1p) payable on 7 March 2013

OPERATIONAL HIGHLIGHTS

·; Continued strong management focus on cost control has resulted in margin improvement

·; Ranked as the number one provider of outplacement services in the UK for the sixth year running

·; Recruitment solutions seeing increased volumes in both public sector Search revenues and across its Interim business

·; Establishment of Career Star Group in April 2012 - a network of 17 leading outplacement partners, covering 44 countries, with 470 offices and 1,700 consultants

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

"We are now seeing the first very tentative signs of growth in underlying demand. However, it is much too early to judge whether this will become a continuing trend. Everything depends on the level of confidence among our clients and this in turn depends on how events in world markets develop. Penna has shown resilience during the recession and remains well positioned for the upturn when it finally comes."

ENDS

For further information please contact:

Stephen Rowlinson, Chairman 0771 00 23699

Gary Browning, Chief Executive 020 7332 7754

David Firth, Finance Director 020 7332 7754

Charles Stanley Securities

Marc Milmo/Karri Vuori 020 7149 6000

Penna Consulting Plc

Chairman's Review

As expected, trading conditions in the first half of the year were subdued, particularly during the Olympic period when we saw some postponement of take up of our outplacement services and the start of recruitment projects. These one off factors were offset by small but encouraging signs of underlying growth and the overall outcome was that both revenue and profit were at similar levels to the same period of the previous year.

Revenue was 3% lower at £33.1m (2011: £34.2m) but net revenue was 3% higher at £19.5m (2011: £18.9m) as a result of the change in mix from traditional advertising to other media. Profit before tax was 2% higher than in the first half of last year at £827,000 (2011: £813,000).

The bulk of net revenue and operating profit continued to come from our HR Consulting (HRC) division with net revenue of £12.4m (2011: £12.3m) and operating profit of £1.1m (2011: £1.1m).

Our Recruitment Solutions (RS) division is smaller but achieved an encouraging level of growth within a weak UK recruitment market. Net revenue was £7.1m, a creditable 8% higher than in the same period of the previous year (2011: £6.6m) and the division produced an operating profit of £143,000 compared to break even in the first half of the previous year.

These modest but positive results must be seen in the context of trading conditions that remain very challenging. Penna continues to benefit from excellent client relationships but demand from clients has only recently shown the first signs of growth from the low levels reached during the recession.

Earnings per share for the six months are 2.4p (2011: 2.4p).

Dividend

Cash at 30th September 2012 was £1.5m and our only debt is a finance lease of £0.5m (31 March 2012: £0.8m). An interim dividend of 1p (2011: 1p) has been declared and this will be paid on 7 March 2013 to shareholders on the register on 8 February 2013.

Operating Review

The Company has two service groups, HR Consulting and Recruitment Solutions, each with a managing director reporting to the Chief Executive.

Divisional Breakdown

HR Consulting, includes our market leading outplacement service, board coaching, assessment, learning and development, performance and change. The division provided services to an impressive 798 clients in the six month period and once again we rank as the number one provider of outplacement services in the UK for the sixth year running.

A modest improvement in net revenues over the same period last year is to be applauded given the impact on service uptake over the period of the Olympic Games. The second half of the financial year is historically busier in HR consulting as clients, particularly in the financial services sector, tend to carry out downsizing as annual budgets are set around the calendar year end. We have secured a number of large contracts where we are aware of increased activity in the second half. One such contract is with LOCOG, supporting the very workers who made the London Olympic Games such a success, transition into new roles and careers.

We have made good progress in establishing the Career Star Group, our new international network of outplacement and career services providers. We set up this network in April of this year and we have signed up 17 partners (all themselves leading outplacement providers in their own geographic regions), covering 44 countries, with 470 offices and 1,700 consultants. We expect that this network will bring incremental revenue going forward and has already generated over US$849,000 of referral income across the network, of which Penna has benefited by £150,000.

Recruitment Solutions combines our service capabilities in recruitment advertising and communications, managed recruitment and assessment, executive search and executive interim. This broad range of recruitment activities enables us to offer clients in both the commercial and public sector innovative solutions to their recruitment needs.

Revenues increased by 8% and we saw a modest increase in demand from our public sector clients which now represent 59% of all recruitment revenues (up from 50% last year). The small but important profit generated from recruitment solutions of £143,000, represents a return to profitability for the first time since the start of the recession.

We have seen a continuation of the trend in client demand moving away from traditional advertising services to more project and consulting related recruitment. This change in service mix together with margin improvement from the traditional services has resulted in improved margins at the delivery level of 4.5 points from 29.8% to 34.3% which clearly contributed to the return to profitability. We have invested in the higher margin consultancy areas of Executive Search and Executive Interim, increasing headcount by 12 consultants since the start of the year and have seen increased volumes in both public sector Search revenues and across our Interim business in general. Search net revenues are up 28% and Interim net revenues are up 12% on the same period last year.

There is little doubt that the climb out of recession will take time however given the cost reductions and restructuring over the last three years any modest improvement in demand will be of benefit to us.

We have continued to innovate new recruitment services and are pleased with our progress in a number of areas. In Graduate recruitment we have built upon the successes with KPMG last year, and secured a number of new accounts in this area including working with the Metropolitan Police, The John Lewis Partnership and Telefonica. We also have continued to build upon last year's success in developing Social Recruitment (the use of web based technologies such as Linked-in and Facebook) where we provide services to an increasing number of our clients who historically procured more traditional recruitment services from us. This trend in recruitment is relentless and inevitable and represents an opportunity as we remain at the forefront of these developments.

Outlook

We are now seeing the first very tentative signs of growth in underlying demand. However it is much too early to judge whether this will become a continuing trend. Everything depends on the level of confidence among our clients and this in turn depends on how events in world markets develop. Penna has shown resilience during the recession and remains well positioned for the upturn when it finally comes.

Stephen Rowlinson

Chairman

13 November 2012

Unaudited condensed consolidated interim statement of comprehensive income

for the six months ended 30 September 2012

Penna Consulting Plc

Unaudited condensed consolidated interim statement of changes in equity

at 30 September 2012

Penna Consulting Plc

Unaudited condensed consolidated interim statement of financial position

at 30 September 2012

Penna Consulting Plc

Unaudited condensed consolidated interim statement of cash flow

for the six months ended 30 September 2012

Penna Consulting Plc

Notes to the unaudited condensed consolidated interim report

for the six months ended 30 September 2012

1. Basis of preparation

The unaudited condensed consolidated interim report for the period ended 30 September 2012 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 2012, 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 2012 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: