31st Mar 2006 07:02
Multi Group PLC31 March 2006 Date: 31 March 2005 On behalf of: Multi Group Plc ("Multi" or "the Company") Embargoed until: 0700hrs Multi Group PlcInterim Results for six months ended 31 December 2005 Multi, the specialist recruitment group, today announces its interim results forthe six months to 31 December 2005. Chairman's StatementFor the period ended 31 December 2005 The six month period under review has been one of intense activity and I ampleased to report that significant progress has now been made toward ourobjective of developing Multi into a strong and profitable group focused on theMedical and Care sectors. In October the directors announced the acquisition of a ninety percent interestin 1st 4 Locums Limited, trading as The Locum Partnership ("TLP"), with anoption to acquire the remaining ten percent on an agreed valuation basis at anytime during the next three years. TLP was a private company operating from asingle branch in Ilford, supplying a range of allied health professionals on acontract basis to the NHS and to the private sector. In November the directors announced the disposal of the Group's investment in anIT resourcing services group quoted on the official list, as this investment wasno longer consistent with the focus of the Group. The price achieved from thesale was the same as the price that was paid for the investment in May. In December the directors announced that the Company had agreed to acquireGlobal Medics Limited, together with its newly acquired subsidiary, Doctors onCall. Global Medics was a private company trading from offices in London and inYorkshire, supplying consultants and senior grade doctors on locum orsubstantive contracts to the NHS and to the private sector. Doctors on Callprovides a similar service and is an approved supplier under the recentlyintroduced National Framework Agreement. As a consequence the Group is able tooffer a range of services to all of the UK's NHS Trusts. This transaction wascompleted after the period end, in February 2006. Global Medics was the fourth acquisition to be completed by Multi since March2005. In addition to these acquisitions the directors have investigated and pursued tovarying degrees a number of other opportunities, which have not come tofruition. As a consequence of this activity one-off costs amounting to some£76,000 have been incurred and these have been written off to the profit andloss account in the period. The results for the period were also adversely impacted by the poor results fromthe Group's general recruitment business, Berry Recruitment Limited. During theperiod this business achieved turnover of £4.76 million and reported anoperating loss of £262,000. This is in marked contrast to Berry Medical Limitedwhich contributed positively to the Group's results and is expected tocontribute more significantly in 2006. In March 2006 the directors announcedthat the Group had disposed of Berry Recruitment to that subsidiary's managementteam. The value of this transaction to Multi was approximately at £1.87 million, whichfigure includes the cash consideration of £500,000 and the £1.37 million of netdebt assumed by the purchasers. The directors consider this transaction to be apositive development for the Group as it has enabled them to dispose of a lossmaking business and to increase their focus on the successful core businesses inthe Medical and Care sectors. The results for the period can therefore be broken into three main parts; theoperating loss incurred as the directors continued the assembly of the Group,the one off costs associated with the investigation of acquisition opportunitiesand the losses incurred by the general recruitment business sold in March 2006.Whilst the results for the period are important in their own right, they do notprovide a meaningful guide to the Company's future performance. Results for the period During the six months to 31 December 2005 the Group reported turnover of £8.28million (six months to 30 June 2005 £2.67 million) on which it achieved grossprofit of £2.12 million or 25.6% (six months to 30 June 2005 £0.679 million or25.4%). On this turnover the ongoing Multi Group reported an operating loss of£296,000. This was before the £76,000 write-off of the costs associated with theinvestigation of acquisition opportunities and the operating loss of £262,000incurred by the general recruitment business disposed of after the period end.The aggregate operating loss was £0.63 million (six months to 30 June 2005 £0.57million). Comparison with previous years is not considered meaningful as theCompany was then operating in a different industry sector. As at 31 December 2005 the Group had net assets of £7.26 million (30 June 2005£6.86 million), and available cash resources of £1.90 million (30 June £3.36million). Change of Year End Following the disposal of the general recruitment business and the recentacquisition of Global Medics, Multi changed its year end date from 31 Decemberto 31 March. This change was to ensure that future results will more accuratelyreflect the composition and focus of the Group. The next set of audited accountswill cover the fifteen month period from 1 January 2005 to 31 March 2006 and itis for this reason that the directors have prepared a second set of interimresults for the Group. Strengthening the Board I am pleased to report that Justyn Randall, the original founder and managingdirector of Global Medics Limited, has been appointed to the board withresponsibility for the day to day operations of the Group's medical businesses. Justyn has over ten years' direct experience in the recruitment industry andbefore founding Global Medics, enjoyed a successful career in the IT recruitmentsector. His sector specific expertise will be of considerable assistance to theboard. The future The Group now has three principal trading subsidiaries: Global Medics, providingconsultants and senior grade doctors into a market sector estimated to be worth£394 million; TLP, providing a range of allied health professionals into amarket sector estimated to be worth £280 million and Berry Medical primarilyfocused on the provision of unskilled and semi-skilled care staff into a marketsector estimated to be worth £125 million. The process of integrating these businesses and streamlining their IT systems,accounting and other back office functions is now well advanced. Once thisprocess has been completed there will be an opportunity to achieve significantfurther leverage from the Group's central resources. In addition the high quality standards, in the form of ISO 9001: 2000 andInvestors in People accreditation, that have already been achieved in parts ofthe Group are being rolled out to become standard across the remainder of theGroup. The directors anticipate that over the coming year the Group will continue togrow organically through the development of new areas of specialism withinexisting sectors and from additional sales volumes gained by capturing marketshare from its competitors. They also anticipate growth from furtheracquisitions and look forward to the future with confidence. O C CookeExecutive Chairman 31 March 2006 Consolidated profit and loss accountFor the period ended 31 December 2005 Six months ended 31 Six months ended 31 December 2005 December 2004 Note £'000 £'000 Turnover 2 8,276 832Cost of sales 6,161 187 Gross profit 2,115 645Selling and distribution costs 1,614 643Administrative expenses 1,135 1,232 Operating loss 2 (634) (1,230) Operating loss of continuing Group:Operating loss (634) (1,230)Add back:Acquisition costs 76 -Discontinuing operations 262 839Continuing Group (296) (391) Earnings before interest, tax, and depreciation:Operating loss (634) (1,230)Add back:Depreciation 60 162Amortisation 111 -EBITDA (463) (1,068) Profit on disposal of businesses - 2,124 (Loss)/profit on ordinary activities before interest (634) 894Interest receivable 38 151Interest payable and similar charges (68) - (Loss)/profit on ordinary activities before taxation (664) 1,045Taxation 3 5 285 (Loss)/profit on ordinary activities after taxation (669) 760Minority interests (11) - (Loss)/profit for the financial period (680) 760 (Loss)/earnings per share:- Basic 4 (0.21)p 0.29p- Diluted 4 (0.21)p 0.28p Consolidated balance sheetAt 31 December 2005 As at 31 December As at 31 December 2005 2004 Note £'000 £'000Fixed assetsIntangible assets 5 6,665 -Tangible assets 6 299 119Investments 7 - - 6,964 119Current assetsTrade debtors 2,686 39Prepayments and accrued income 705 180Other debtors 85 199Cash at bank and in hand 1,904 5,120 5,380 5,538 Creditors: amounts falling due within one year (5,006) (1,300) Net current assets 374 4,238 Total assets less current liabilities 7,338 4,357Creditors: amounts falling due after more than oneyear - (20) Provisions for liabilities and charges (37) (35) 7,301 4,302Minority interests (43) - Net assets 7,258 4,302 Capital and reservesCalled up share capital 425 2,541Share premium account 6,446 3,095Shares to be issued 700 -Other reserves 2,276 -Profit and loss account (2,589) (1,334) Shareholders' funds - equity 8 7,258 4,302 Consolidated cash flow statementFor the period ended 31 December 2005 Six months ended 31 Six months December 2005 ended 31 December 2004 £'000 £'000Reconciliation of operating loss to net cash (outflow)/inflowfrom operating activities Operating loss (634) (1,230)Depreciation and amortisation charges 171 162Loss on disposal of fixed assets - 104Decrease in stocks 2Decrease in debtors (738) 2,333Decrease in creditors 146 (1,340) Net cash (outflow)/inflow from operating activities (1,055) 31Consolidated cash flow statementNet cash (outflow)/inflow from operating activities (1,055) 31Returns on investments and servicing of finance (30) 151Taxation paid (5) -Proceeds from sale of businesses - 7,000Capital expenditure (net of disposal proceeds) (231) (125)Acquisitions (2,756) - Cash (outflow)/inflow before financing (4,077) 7,057Financing 1,820 (513) (Decrease)/increase in cash in the period (2,257) 6,544 Reconciliation of net cash (outflow)/inflow to (increase)/decrease in net debt(Decrease)/increase in cash in the period (2,257) 6,544Cash outflow from decrease in debt and lease financing 3 613 Change in net debt resulting from cash flows (2,254) 7,157Net funds/(debt) at start of the period 2,021 (2,149) Net (debt)/funds at 31 December (233) 5,008 Notes to the interim resultsFor the period ended 31 December 2005 1 Accounting periods The accounting reference date of the Group has been changed from 31 December to31 March. The current interim results are for the 26 week period ended 31December 2005 and the comparative interim results are for the 26 week periodended 31 December 2004. 2 Continuing and discontinued operations Continuing Discontinued Total £'000 £'000 £'000Six months ended 31 December 2005Turnover 3,520 4,756 8,276 Operating loss (372) (262) (634) Six months ended 31 December 2004Turnover - 832 832 Operating loss (391) (839) (1,230) 3 Taxation Six months ended 31 Six months December 2005 ended 31 December 2004 £'000 £'000The charge for taxation is based on the profit/(loss) onordinary activities for the period and comprises:UK corporation tax charge - 285Adjustments in respect of prior years 5 - 5 285 4 (Loss)/earnings per share The calculation of (loss)/earnings per share for the period ended 31 December2005 is based on a loss after taxation of £680,000 (2004 interim: profit of£760,000). The calculation of basic (loss)/earnings per share is based on the weightedaverage number of shares in issue during the period of 327,290,007 (2004interim: 265,035,506). Reconciliation of the denominators used for basic and diluted (loss)/earningsper share calculations: Effect of share options Basic Diluted 31 December 2005 327,290,007 7,393,470 334,683,47731 December 2004 265,035,506 4,387,975 269,423,481 Additional disclosure is given below in respect of basic (loss)/earnings pershare before depreciation and amortisation, as the directors believe this givesa more accurate presentation of maintainable earnings. Six months ended 31 Six months December 2005 ended 31 December 2004 Pence Pence Basic (loss)/earnings per share (0.21) 0.29Depreciation and amortisation 0.05 0.06 Basic (loss)/earnings per share beforedepreciation and amortisation (0.16) 0.35 Diluted (loss)/earnings per share (0.20) 0.28Depreciation and amortisation 0.05 0.06 Diluted (loss)/earnings per share beforedepreciation and amortisation (0.15) 0.34 5 Intangible assets Goodwill £'000CostAs at 1 July 2005 4,780Additions 3,452Reduction in consideration payable (1,400) As at 31 December 2005 6,832 AmortisationAs at 1 July 2005 56Charge for the period 111 As at 31 December 2005 167 Net book valueAt 31 December 2005 6,665 At 31 December 2004 - Additions to goodwill in the period are analysed as follows: £'000 Additions on the acquisition of 90% of 1st 4 Locums Limited 3,418Additions on the acquisition of the business of Grays Personnel Limited 34 3,452 6 Tangible assets Motor Other vehicles assets* Total £'000 £'000 £'000CostAt 1 July 2005 25 496 521Additions - 114 114Acquisition of subsidiary undertaking - 58 58Disposals - (10) (10) At 31 December 2005 25 658 683 DepreciationAt 1 July 2005 21 284 305Charge for the period 3 57 60Acquisition of subsidiary undertaking - 27 27Eliminated on disposal - (8) (8) At 31 December 2005 24 360 384 Net book valueAt 31 December 2005 1 298 299 At 31 December 2004 - 119 119 *Other assets include leasehold improvements, fixtures and fittings, officeequipment and computer equipment. 7 Investments Listed £'000CostAt 1 July 2005 300Disposals (300) At 31 December 2005 - Net book valueAt 31 December 2005 - At 31 December 2004 - 8 Reconciliation of movement in shareholders' funds Six months ended 31 Six months December 2005 ended 31 December 2004 £'000 £'000(Loss)/profit on ordinary activities aftertaxation for the financial period (680) 760Ordinary shares issued, net of expenses 2,124 49 Change in shares to be issued (1,050) - Net increase in shareholders' funds 394 809Opening shareholders' funds 6,864 3,493 Closing shareholders' funds 7,258 4,302 9 Segmental analysis of turnover, operating profit/(loss) and net assets By business segment: Discontinued Discontinuing Continuing Hire of plant & General Medical machinery Recruitment Recruitment Total £'000 £'000 £'000 £'000For the six months ended 31 December2005:Turnover - 4,756 3,520 8,276 Loss on ordinary activities beforeinterest - (262) (372) (634) Net assets/(liabilities) - (2,821) 10,079 7,258 For the six months ended 31 December2004:Turnover 832 - - 832 Profit/(loss) on ordinary activitiesbefore interest 1,285 - (391) 894 Net assets - - 4,302 4,302 10 Post balance sheet events In February 2006 the Company acquired Global Medics Limited and its subsidiaryDoctors on Call Limited. In March 2006, the Company disposed of its non-core general recruitmentsubsidiary, Berry Recruitment Ltd, to that subsidiary's management team. 11 The interim financial information does not comprise statutory accounts asdefined in Section 240 of the Companies Act 1985. The interim financialinformation has been prepared on the basis of the accounting policies set out inthe Annual Report for the year ended 31 December 2004. The financial information for the periods ended 31 December 2004 and 31 December2005 is unaudited. The balance sheet at 31 December 2004 is audited. The financial information for the period ended 31 December 2004 is derived fromthe latest Group accounts. Those accounts received an unqualified auditors'report and have been filed with the Registrar of Companies. - ends - Enquiries to: Oliver C Cooke, ChairmanMulti Group Plc Tel: 08701 602 901 Emma Kane/Miranda GoodRedleaf Communications Ltd Tel: 020 7955 1410 - Further information can be found on the Company's website http://www.multiplc.com . This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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