28th Sep 2007 07:05
Harvey Nash Group PLC28 September 2007 HARVEY NASH GROUP PLC("Harvey Nash" or "the Group") Unaudited Interim Results for the six months ended 31 July 2007 Harvey Nash, the global professional recruitment services and outsourcing group,with over 3700 staff and associates in 33 offices, announces an excellent firsthalf year performance. Financial Results 2007 2006 ChangeRevenue £143.9m £121.2m + 19%Net fee income £27.0m £23.1m + 17%Operating Profit £3.5m £3.1m + 12%Adjusted operating profit * £3.5m £2.7m + 31%Profit before tax £3.1m £2.6m + 17%Adjusted profit before tax * £3.1m £2.2m + 40%Earnings per share 3.13p 2.71p + 15%Adjusted earnings per share * 3.13p 2.22p + 41%Net Cash from operating activities £2.4m £1.9m + 30% * Adjusted = excluding the profit on disposal of investment in the period ended31 July 2006 Net fee income=gross profit (and this will apply throughout the statement) Operational Highlights • Strong revenue growth at 19% • Underlying growth rate of net fee income accelerated to 17% (2006: 11%) • Adjusted profit before tax up 40% • Adjusted EPS growth of 41%, exceeding management's expectations • Adjusted UK operating profit up 41%, European operating profit up 37% • Strong cash generation, up 30% • Acquisitions in Sweden and Vietnam performing well • 23% increase in fee-earners • Interim dividend 0.7p per share Commenting on the results, the Chief Executive Officer, Albert Ellis, said: "These results demonstrate the success of the Group's strategy in building asustainable growth platform through geographic expansion both organically and byacquisition and maintaining focus on longer term visible revenues. Harvey Nash has one of the strongest brands in the market. Combined with itsunique portfolio of services and the benefits from recent acquisitions, I amconfident that our investment will provide further momentum going forward." ENQUIRIES:Harvey Nash Tel: 020 7333 2635Albert Ellis, Chief ExecutiveRichard Ashcroft, Group Finance DirectorCollege Hill Tel: 020 7457 2020Mark GarrawayMatthew Gregorowski A presentation of the results will take place at 09:30 this morning at theoffices of College Hill, The Registry, Royal Mint Court, EC3N 4QN CHAIRMAN'S STATEMENT Group results for the six months ended 31 July 2007 reflect another excellentperformance in both revenue and profit, particularly in the UK and Europe. The market remained strong throughout the period, particularly the demand forpermanent staff. Net permanent fees were up 36%. Demand for Offshore servicesresulted in net fee income increasing substantially, further strengthening theGroup's long term visible annuity revenues and profits. The Group successfully concluded two acquisitions during the period, expandingboth its geographic footprint and its offshore delivery capacity. Theacquisition of Alumni AB, Sweden's leading executive search consultancy, wascompleted in May 2007 and Offshore services were significantly strengthened withthe acquisition of SilkRoad Systems Limited, a Vietnamese based IT outsourcingbusiness in June 2007. Critical mass increased across the Group's operations due to organic growth andgrowth by acquisition, with average fee-earner headcount increasing by 23%. Thisresulted in an acceleration of net revenue growth compared to last year and hasled to an improvement in the overall conversion ratio from additionalproductivity gains. Financial Results The Group's revenue for the six months ended 31 July 2007 increased by 19% to£143.9m (2006: £121.2m). Net fee income accelerated by 17% (2006: 11%) to £27.0m(2006: £23.1m). Adjusted operating profit increased by 31% (2006: 20%) to £3.5m (2006: £2.7m)and adjusted profit before tax, excluding the profit on disposal, increased by40% to £3.1m (2006: £2.2m). The tax charge for the period was £1.0m (2006:£0.9m). The tax rate was 30.8% (2006: 34.4%). Basic earnings per share increased by 15% (2006: 5%) to 3.13p (2006: 2.71p). Balance Sheet Intangible assets increased by £8.7m in the six months as a result of theacquisitions of Alumni AB (£7.6m) and SilkRoad Systems Limited (£1.1m). TheGroup is using the 12 months after acquiring the businesses to consider whetherthere are intangible assets that should be recognised separately from goodwill. The deferred income tax asset rose in the six months by £0.3m owing mainly todeferred tax on share options (£0.1m), holiday accruals (£0.1m) and interest(£0.1m). Total receivables were 15% higher than at 31 January 2007 owing to a 19%increase in revenue. Working capital continues to be tightly managed. The contingent consideration represents potential future payments for theacquisition of Alumni AB. Operational Review United Kingdom Revenue in the UK increased by 12% to £49.6m (2006: £44.2m) and operating profitincreased by 41% to £1.8m, (2006: £1.3m). The demand for both permanent IT recruitment and executive search has beenstrong throughout the period and the UK business has capitalised on this trend.Expanding the executive and senior fee-earning capacity has been a key focus. Inthe IT sector the Harvey Nash brand is extremely strong, particularly in themarket for CIOs and IT executives. This division is generating a healthypipeline of new business and has been further strengthened with additionalhigh-calibre consultants. The executive search business has expanded all its main practice sectors,including Industry, Commerce, Business Services, Public Sector, FinancialServices and CFO. The new office in Edinburgh is ahead of budget. Offshore services net fee income grew substantially compared to the same periodlast year. With the acquisition of SilkRoad in Vietnam, the software developmentand business process outsourcing expertise has been increased. Continental Europe Revenue in mainland Europe increased by 31% to £82.4m (2006: £63.0m), andoperating profit increased by 37% to £1.4m (2006: £1.0m). Demand for IT recruitment services is strong in Europe, with clients expandingtheir headcount and IT project flow. Growth has been stronger in theScandinavian and Benelux regions than in the rest of Europe although the Frenchmarket is much improved. While the proportion of revenue from permanent hiringhas been lower than in the rest of the Group during the period, IT freelancersworking at client sites have increased compared to last year. In the Netherlands, the Group continues to enjoy substantial growth in demandfrom clients to outsource their flexible workforce risk management. This in turnhas resulted in an increase in core higher margin services. To support thisgrowth the Group has invested in additional fee-earners. Belgium has alsoperformed well and increased its net fee income by 21%. As previously reportedalthough lower margins were achieved overall in Germany, margin growth in the ITengineering sector was strong and SAP revenues have also increased in line withdemand. In Switzerland, as expected, margins are under pressure in the FinancialServices sector. In Paris, the Group increased its fee earning capacity and headcount in linewith the economic recovery being reported in the French market. In Geneva, inline with the budget, the additional headcount has affected the contribution inthe short term. However, the pipeline and second half prospects are strong. United States Revenue in the USA was 15% lower at £12.0m (2006: £14.1m), but operating profitheld up relatively well at £328k (2006: £385k), down only 6% in constantcurrency terms. As we stated in last year's report, the focus on higher margin activities suchas Executive Search and IT Solutions has increased the gross and net profitmargins, notwithstanding the decline in turnover. This is mainly as a result oflower demand for IT freelancers combined with a higher number of freelancersaccepting permanent positions. Gross margin increased from 30% to 34%. Resultsfrom Seattle and Chicago were particularly strong, with demand increasing forpermanent hiring and IT outsourcing at clients such as T-Mobile. The new officesin Boston and Phoenix are performing in line with expectations and theoutsourcing division increased net fee income fivefold to £0.7m (2006: £0.1m) Although the current US macro- economic growth has slowed, skills shortagespersist in the IT sector and the demand for executive search and permanentrecruitment is strong. The US business has benefited substantially from theGroup's broad portfolio of services and emphasis on IT solutions. Continuedfocus on the IT solutions and offshore services will be maintained goingforward. This includes the possibility of adding to the Group's portfoliothrough selective bolt-on acquisitions as the current environment isparticularly conducive to securing opportunities on an attractive basis. Acquisitions On 22 May 2007, Harvey Nash completed the acquisition of Alumni AB, ranked theleading Executive Search and Strategic Leadership Consultancy in Sweden, for amaximum consideration of £8.0m (net of acquired cash of £0.6m). The initialconsideration was funded by way of a vendor placing of 5.5m ordinary shares of5p each with existing and new institutional shareholders raising approximately£4.41m gross, representing 7.6% of the Company's issued share capitalimmediately following admission. On 26 June 2007, the Group entered into an agreement to acquire SilkRoad SystemsLimited and its subsidiary, SilkRoad Systems (Vietnam) Limited ('SilkRoad'), aleading technology and software development company based in Ho Chi Minh City,Vietnam, for a maximum consideration of US$1.8m on completion plus additionalpayments of up to US$0.2m over the three years ending 30 June 2010 subject tocertain profit targets being achieved. Since 31 July 2007, the Group has acquired Rescon Ltd, an IT recruitmentbusiness in Ireland, for an initial cash consideration of £2.5m. Deferredconsideration of £2.7m is payable dependent on certain profit targets beingachieved over the next three years. The acquisitions complement the Group's strategy and integration is progressingwell. Cash flow Net cash generated from operating activities was up 30% to £2.4m (2006: £1.9m).Taxes paid represented £0.4m (2006: £0.7m), capital expenditure of £0.3m (2006:£0.3m) was incurred and net interest paid was £0.4m (2006: £0.5m). Netborrowings were further reduced by 49% to £2.4m (2006: £4.7m). Dividends The Group will pay an interim dividend of 0.7p per share (2006: £Nil) on 30November 2007 to shareholders on the register at 12 October 2007. Outlook The Group's strategy is to build a sustainable platform for balanced growthfocusing on longer term visible revenues and profits, while expanding geographicdiversity into new fast growing markets. We also continue to focus on organicgrowth through the hiring of additional fee-earners and during the period, theGroup has successfully completed a number of acquisitions, the benefits of whichwill flow into the second half. This strategy has resulted in a continued growth of net fee income into thetraditionally stronger second half of the year when compared to the same periodlast year. Looking forward, we are pleased with the performance of our UK and Europeanbusinesses and with the strength and relative stability of our US business inthe current US market conditions. We remain confident of delivering results forthe full year in line with the Board's expectations. Ian Kirkpatrick Chairman 28 September 2007 Condensed Unaudited Consolidated Interim Income Statement Notes 6 months ended 6 months ended Year ended 31 July 2007 31 July 2006 31 January 2007 £'000 £'000 £'000Revenue 3 143,867 121,246 251,742Cost of sales (116,905) (98,158) (203,480)Gross profit 26,962 23,088 48,262Total administrative expenses (23,444) (19,960) (41,530) Operating profit before material one-off item 3,518 2,679 6,283 Profit on disposal of Investment - 449 449Operating profit 3 3,518 3,128 6,732 Finance income 176 40 299Finance costs (605) (519) (1,235)Profit before tax 3,089 2,649 5,796Income tax expense 4 (951) (911) (1,712)Profit for the half year 2,138 1,738 4,084 Basic earnings per share 5 3.13p 2.71p 6.33pDiluted earnings per share 5 3.04p 2.58p 6.18p Condensed Unaudited Consolidated Interim Balance Sheet Notes 31 July 2007 31 July 2006 31 January 2007 £'000 £'000 £'000ASSETSNon-current assetsProperty, plant and equipment 1,467 1,611 1,450Intangible assets 36,255 28,146 27,516Deferred income tax assets 1,663 1,027 1,304 39,385 30,784 30,270Current assetsTrade and other receivables 59,765 47,375 51,747 Total assets 99,150 78,159 82,017 LIABILITIESCurrent liabilitiesFinancial liabilities - borrowings 6 (1,629) (2,748) (1,784)Trade and other payables (47,975) (37,897) (40,736)Current income tax liabilities (2,442) (573) (1,388)Provisions (38) - (328)Contingent Consideration 8 (1,165) - - (53,249) (41,218) (44,236)Non-current liabilitiesFinancial liabilities - borrowings 6 (752) (1,952) (819)Deferred income tax liabilities (155) (221) (175)Provisions - (10) -Contingent Consideration 8 (2,278) - - (3,185) (2,183) (994)Total liabilities (56,434) (43,401) (45,230)Net assets 42,716 34,758 36,787 Capital and reserves attributable to equity shareholdersShare capital 3,622 3,267 3,325Share premium 8,208 4,110 4,111Shares to be issued 436 1,205 595Fair value and other reserves 15,079 14,323 15,079Own shares held (457) (656) (656)Cumulative translation reserve (942) (173) (885)Retained earnings 16,770 12,682 15,218Total equity 42,716 34,758 36,787 Condensed Unaudited Consolidated Interim Statement of Changes in Equity Share Share Shares to Fair value Own Cumulative Retained Total capital premium be issued and other shares translation earnings equity reserves held reserve £ '000 £ '000 £ '000 £ '000 £ '000 £ '000 £ '000 £ '000Balance at1 February 2006 3,137 19,064 2,532 13,152 (656) 93 (4,210) 33,112Employee share option 19 109 - - - - 91 219and bonus planCapital Restructuring - (15,063) - - - - 15,063 -Settlement of deferred 111 - (1,282) 1,171 - - - -considerationProfit for the period - - - - - - 1,738 1,738Currency translation - - (45) - - (266) - (311)adjustmentsBalance at 31 July 2006 3,267 4,110 1,205 14,323 (656) (173) 12,682 34,758Employee share option - 1 263 - - - 69 333and bonus planIFRS 2 Deferred Tax to - - - - - - 277 277equitySettlement of deferred 58 - (814) 756 - - - -considerationProfit for the period - - - - - - 2,346 2,346Goodwill adjustment - - - - - - (156) (156)Currency translation - - (59) - - (712) - (771)adjustmentsBalance at 31 January 3,325 4,111 595 15,079 (656) (885) 15,218 36,7872007Employee share option 10 50 (263) - 199 - 60 56and bonus planIFRS 2 Deferred Tax to - - - - - - 75 75equityAcquisitions in the 287 4,320 116 - - - - 4,723periodCosts associated with - (273) - - - - - (273)raising equityProfit for the period - - - - - - 2,138 2,138Dividend paid (note 9) - - - - - - (721) (721)Currency translation - - (12) - - (57) - (69)adjustmentsBalance at 31 July 2007 3,622 8,208 436 15,079 (457) (942) 16,770 42,716 Condensed Unaudited Consolidated Interim Cash Flow Statement Notes 6 months ended 6 months Year 31 July 2007 ended ended £'000 31 July 2006 31 January 2007 £'000 £'000Profit before taxation 3,089 2,649 5,796Adjustments for:- depreciation 405 414 789- loss on disposal of fixed assets - - 33- finance income (176) (40) (299)- finance expense 605 519 1,235- profit on sale of investment - (449) (449)- share based employee settlement and share 60 87 423option chargeOperating cash flows before changes in working 3,983 3,180 7,528capitalChanges in working capital (excluding theeffects of acquisition and exchange differenceson consolidation)- increase in trade and other receivables (7,724) (4,246) (7,639)- increase in trade and other payables 6,877 3,573 5,138- net movements in provisions for liabilities (290) 4 314and chargesCash flows from operating activities 2,846 2,511 5,341Income tax paid (427) (650) (630)Net cash generated from operating activities 2,419 1,861 4,711 Cash flows from investing activitiesPurchases of property, plant and equipment (286) (294) (565)Proceeds from sale of investment - 449 449Cash acquired with acquisitions 8 315 - -Purchase of subsidiary undertakings 8 (1,218) - -Net cash (absorbed)/ generated from investing (1,189) 155 (116)activities Cash flows from financing activitiesRepayment of borrowings - - (1,000)Proceeds from issue of ordinary shares 60 128 129Dividends paid to group shareholders 9 (721) - -Interest received 176 40 299Interest paid (605) (519) (1,235)Net cash used in financing activities (1,090) (351) (1,807) Increase/(decrease) in cash and cash 140 1,665 2,788equivalentsCash and cash equivalents at the beginning of (784) (3,371) (3,371)the periodExchange loss on cash and cash equivalents 15 (42) (201)Cash and cash equivalents at the end of the 6, 7 (629) (1,748) (784)period Notes to the Condensed Unaudited Consolidated Interim Financial Statements 1. Corporate Information Harvey Nash Group plc (the Company) and its subsidiaries (together 'the Group')is a leading provider of specialist recruitment and outsourcing solutions. TheGroup has offices in the UK, Europe, the United States and Vietnam. The Company is a public listed company incorporated in the UK. Its registeredaddress is 13 Bruton Street, London, W1J 6QA and its primary listing is on theLondon Stock Exchange. The condensed consolidated interim financial information for the six monthsended 31 July 2007 was approved for issue on 27 September 2007. 2. Accounting Policies Basis of preparation This condensed consolidated interim financial information for the six monthsended 31 July 2007 has been prepared in accordance with IAS 34, 'Interimfinancial reporting' and the disclosure requirements of the Listing Rules. Itdoes not include all the information required for full annual financialstatements, and should be read in conjunction with the consolidated financialstatements of the Group for the year ended 31 January 2007. Nature of financial information The interim financial information does not constitute statutory financialstatements as defined under Section 240 of the Companies Act 1985. The interimresults to 31 July 2007 and 2006 are neither audited nor reviewed by theCompany's auditors. The financial information for the year ended 31 January2007 has been extracted from the statutory accounts for that year which havebeen delivered to the Registrar of Companies. The report of the auditors onthose accounts was unqualified and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985. Significant accounting policies In preparing these interim financial statements the same accounting policies,methods of computation and presentation have been applied as those set out inthe Harvey Nash Group plc annual report for the year ended 31 January 2007. Theaccounting policies are drawn up in accordance with International AccountingStandards (IAS) and International Financial Reporting Standards (IFRS) asendorsed by the European Union. The accounting policies adopted in the preparation of the interim consolidatedfinancial statements are consistent with those followed in the preparation ofthe Group's annual financial statements for the year ended 31 January 2007,except for the adoption of the following standards mandatory for annual periodsbeginning on or after 1 January 2007: • IFRS 7, Financial instruments: Disclosure; • IFRIC 7, Applying the restatement approach under IAS 29; • IFRIC 8, Scope of IFRS 2; • IFRIC 9, Reassessment of embedded derivatives; and • IFRIC 10, Interims and impairment. • The adoption of these standards did not affect the Group results of operationsor financial position. 3. Segment Information The Group operates in one business segment being that of recruitment servicesand outsourcing services. As a result, no additional business segmentinformation is required. The Group's secondary segment is geography. Thesegment results by geography are shown below: Analysis of Revenue Unaudited Unaudited Audited 6 months ended 6 months 12 months ended 31 July 2007 ended 31 January 2007 £'000 31 July 2006 £'000 £'000United Kingdom 49,551 44,168 92,220Netherlands 51,437 34,892 74,668Rest Of Europe 30,914 28,090 57,895United States 11,965 14,096 26,959Total 143,867 121,246 251,742 Analysis of Operating Profit Unaudited Unaudited Audited 6 months ended 6 months 12 months ended 31 July 2007 ended 31 January 2007 £'000 31 July 2006 £'000 £'000United Kingdom 1,777 1,261 2,534Netherlands 630 414 1,263Rest Of Europe 783 619 1,596United States 328 385 890Profit on disposal of investment - 449 449Total 3,518 3,128 6,732 4. Taxation Unaudited Unaudited Audited 6 months ended 6 months 12 months ended 31 July 2007 ended 31 January 2007 £'000 31 July 2006 £'000 £'000Current tax:Tax on profit in the period 1,255 701 1,542Adjustments in respect of prior periods - 54 65Total current tax 1,255 755 1,607 Deferred tax:Origination and reversal of timing differences (379) 152 (172)Deferred tax to equity 75 4 277Total deferred tax charge (304) 156 105 Total tax charge (continuing operations) 951 911 1,712 5. Earnings per Share Unaudited Unaudited Audited 6 months 6 months ended 12 months ended 31 July 2006 ended 31 July 2007 31 January 2007Profit for the half year £'000 2,138 1,738 4,084Weighted average number of shares 68,367,425 64,082,419 64,542,753Basic earnings per share 3.13p 2.71p 6.33p Basic earnings per share is calculated by dividing the earnings attributable toordinary shareholders by the weighted average number of ordinary shares in issueduring the year, excluding those held in the employee share trust, which aretreated as cancelled. For diluted earnings per share, the weighted average number of ordinary sharesin issue is adjusted to assume conversion of all dilutive potential ordinaryshares. The Group has two categories of potential ordinary shares: those shareoptions granted to employees where the exercise price is less than the averageprice of the Company's ordinary shares during the year, and deferredconsideration shares to be issued. Unaudited Unaudited Audited 6 months ended 6 months 12 months ended 31 July 2007 ended 31 January 2007 31 July 2006Profit for the half year £'000 2,138 1,738 4,084Weighted average number of shares 68,367,425 64,082,419 64,542,753Effect of dilutive securities 2,058,674 3,310,263 1,533,120Adjusted weighted average number of shares 70,426,099 67,392,682 66,075,873Diluted earnings per share 3.04p 2.58p 6.18p 6. Cash and Cash Equivalents Cash and bank overdrafts include the following for the purposes of the cash flowstatement. Unaudited Unaudited Audited 6 months ended 6 months 12 months ended 31 July 2007 ended 31 January 2007 £'000 31 July 2006 £'000 £'000Cash and cash equivalents (629) (1,748) (784)Debt within one year (1,000) (1,000) (1,000)Debt after one year (752) (1,952) (819)Net debt (2,381) (4,700) (2,603) 7. Analysis of Changes in Net Debt 1 February 2007 Unaudited Unaudited Unaudited £'000 Cash flow Foreign exchange 31 July movements £'000 £'000 2007 £'000Cash and cash equivalents (784) 140 15 (629) (784) 140 15 (629)Debt due within one year (1,000) - - (1,000)Debt due after one year (819) - 67 (752) (1,819) - 67 (1,752)Total (2,603) 140 82 (2,381) 8. Business Combinations The Group made 2 acquisitions in the period. As allowed under IFRS 3, the Groupis using the 12 months after acquiring the businesses to consider whether thereare intangible assets that should be recognised separately from goodwill. In both cases, the provisional fair value of the net assets acquired isapproximately equal to the acquiree's carrying amount. Alumni AB On 22 May 2007, the Group acquired 100% of the share capital of Alumni AB, anExecutive Search and Strategic Leadership Consultancy in Sweden. The consideration comprised initial cash consideration of £4.6m and additionalpayments which will be payable in cash of up to £3.4m over the four years ending30 April 2011 subject to certain profit targets being achieved. The acquired business contributed revenues of £1.2m and operating profit of£0.3m to the Group for the period from acquisition to 31 July 2007. If theacquisition had occurred on 1 February 2007, consolidated revenue andconsolidated profit for the half-year ended 31 July 2007 would have been £146.2mand £3.9m respectively. Details of provisional net assets acquired and goodwill are as follows: £'000Initial cash paid - net proceeds of share issue 4,136Initial cash paid - directly by the Group 451Contingent Consideration - current 1,165Contingent Consideration - non-current 2,278Direct costs relating to the acquisition - paid 60Direct costs relating to the acquisition - accrued 96Total purchase consideration 8,186Fair value of net identifiable assets acquired 549Intangible Asset 7,637 The intangible asset is attributable to Alumni AB's strong position andprofitability in its market and the synergies expected to arise after itsacquisition by the Group. The assets and liabilities arising from the acquisition are as follows: £'000Fixed Assets 215Cash 297Receivables 737Payables (700)Net identifiable assets acquired 549 Outflow of cash to acquire business, net of cash acquired: £'000Cash Consideration 4,587Cash and Cash equivalents in subsidiary acquired (297)Cash outflow on acquisition 4,290 Harvey Nash raised £4.41m gross to fund the acquisition by placing an additional5,512,500 shares at 80p. SilkRoad Systems Limited On 25 June 2007, the Group acquired 100% of the share capital of SilkRoadSystems Limited and its subsidiary, SilkRoad Systems (Vietnam) Limited, atechnology and software development company based in Ho Chi Minh City, Vietnam. The consideration comprised initial cash consideration of £0.7m, 226,646ordinary 5p shares in Harvey Nash Group plc and additional payments of up to£0.1m which will be payable in shares in Harvey Nash Group plc over the threeyears ending 30 June 2010 subject to certain profit targets being achieved. The acquired business contributed revenues of £0.06m and operating profit of£0.01m to the Group for the period from acquisition to 31 July 2007. If theacquisition had occurred on 1 February 2007, consolidated revenue andconsolidated profit for the half-year ended 31 July 2007 would have been £144.2mand £3.6m respectively. Details of net assets acquired and goodwill are as follows: £'000Initial cash paid 707226,646 ordinary 5p shares in Harvey Nash Group plc 197Deferred consideration 116Direct costs relating to the acquisition - accrued 82Total purchase consideration 1,102 Fair value of net identifiable assets acquired 46Intangible Asset 1,056 The intangible asset is attributable to SilkRoad Systems (Vietnam) Limited'sstrategic fit with the Group's Outsourcing and Offshoring capabilities. The assets and liabilities arising from the acquisition are as follows: £'000Fixed Assets 42Cash 18Receivables 162Payables (176)Net identifiable assets acquired 46 Outflow of cash to acquire business, net of cash acquired: £'000Cash Consideration 707Cash and Cash equivalents in subsidiary acquired (18)Cash outflow on acquisition 689 9. Dividends The Group paid a final dividend of 1p per share on 28 June 2007 to shareholderson the register as at 8 June 2007. 10. Post Balance Sheet Events On 17 August 2007, the Group acquired Rescon IT, a leading IT recruitment andsolutions business based in Dublin. Total consideration of €7.7m is made up of €3.7m initial consideration in cashand deferred consideration of up to a further €4.0m in shares of Harvey Nash,subject to Rescon achieving certain demanding profit targets for each of thethree years ending 31 July 2008 to 31 July 2010. If these demanding thresholdsare exceeded, up to €2.3m additional contingent consideration in Harvey Nashshares may become due. 11. Distribution of Interim Financial statements Copies of this statement are being dispatched to shareholders who voted toreceive a paper copy, and are available to members of the public on the Group'swebsite at www.harveynash.com or from the registered office at 13 Bruton Street,London, W1J 6QA. Statement of Directors' Responsibilities The directors' confirm that this condensed set of financial statements has beenprepared in accordance with IAS 34 as adopted by the European Union, and thatthe interim management report herein includes a fair review of the informationrequired by DTR 4.2.7 and DTR 4.2.8. The directors of Harvey Nash Group plc are listed in the Harvey Nash Group plcAnnual Report for 31 January 2007. By order of the Board Albert EllisChief Executive Officer27 September 2007 Richard AshcroftGroup Finance Director27 September 2007 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Harvey Nash Group