2nd Sep 2005 11:09
Berkeley Scott Group Plc02 September 2005 2 September 2005 Berkeley Scott Group Plc ("Berkeley Scott" or the "Company") Trading Update Following the statement accompanying the interim results on 17th June, the Boardof Berkeley Scott announces that the increase in income that had been expectedas a result of the greater number of fee earners has not come through at therate previously anticipated. The rate at which vacancy registrations have beenconverted into placements within the Permanent Recruitment Division has beenrunning at only some two thirds of the rate experienced in previous years. This underperformance by the Permanent Recruitment Division combined with thehiatus caused to the hotel and leisure industry in London by the terroristattacks during July, and an influx of cheap labour from Eastern Europe duringthe summer holiday months, is estimated to have resulted in a shortfall of NetFee Income in the order of £600,000. As a result after charging £280,000 ofnon-recurring costs, and up to £230,000 of costs and losses in relation todiscontinued business activities (as outlined below) for the year to 30thSeptember 2005, EBITDA will be at or slightly above break-even The Board has identified that the underperformance has largely resulted from alack of appropriate experience within the senior management team and hastherefore made a number of changes over the last few weeks, which, it is hoped,will enable the productivity levels to be restored. The Company is just enteringits historically most productive month of the year and the order book remainsvery strong. The Board hopes that by the time it comes to report full yearresults in December 2005, it will also be able to report that the changes it haseffected are producing results. The Company has access to a range of debt facilities, which provides it with adegree of flexibility, and the Board remains comfortable as to the Company'sfinancial position. In conjunction with the introduction of a new management structure, the Boardhas recently decided to withdraw from a small non-core activity, namely theCompany's commercial recruitment business based in Manchester, which hascontinued to be loss-making and, it was decided, was unlikely ever to become amajor contributor to the group's earnings. There are costs and losses of up to£230,000 associated with the closure of this division. The Board will provide a further update for shareholders after the end of thetrading year on 30th September 2005. Enquiries: Berkeley Scott GroupRoddy Watt, Chief Executive 01483 414141Will Coker, Chief Financial Officer Cardew GroupTim Robertson 020 7930 0777Catherine Maitland This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Kellan Group