20th Jan 2005 07:00
Thursday 20 January 2005: embargoed for 7.00am Parity Group plc Trading Update Parity Group plc ("Parity" or "the Group"), the international IT servicesgroup, invited Philip Swinstead to rejoin its Board as Chairman on 12 November2004. It was announced that Mr Swinstead's first undertaking as Parity'sChairman would be to commence a strategic review of the Group, reporting backto shareholders in the preliminary results announcement in March 2005.Some of the operational problems at Parity quickly became apparent as thisreview progressed and, following the departure of the then Chief Executive on30 November 2004, the Board asked Mr Swinstead to be responsible for theexecutive management of the business in the short term and to set about takingthe necessary corrective action.Based on management accounts, Parity's preliminary results for the year-ended31 December 2004 will show good operating profits from the growing ResourcingSolutions businesses in the UK and across mainland Europe, a small loss inBusiness Solutions in the second half, a small annual operating profit in theUSA where the market has improved recently, and a loss in Training as predictedin November 2004.Parity is closing the Group's head office and moving the few remaining centralstaff to smaller premises, still in London. It has also been necessary toreduce the overall Group headcount to restore the appropriate revenue/costbalance and therefore, regrettably, up to 60 people will be leaving the Group.In total, the Group is expected to report a loss for 2004 after discontinuedoperations and before goodwill amortisation and tax of the order of ‚£6.5million, less than half of which will be trading losses, with the balancecomprising exceptional charges including redundancy and further empty propertyprovisions for up to five years.For 2005, the Group has budgeted on the basis of a cautious baseline and isincentivising managers to achieve a higher performance. The 2005 budgetsindicate that this will be a recovery year, with the second half benefitingfrom trading improvements in Training and Business Solutions, in anticipationof the business being back in good order in 2006.Commenting on today's announcement, Philip Swinstead, Chairman of Parity Groupplc, said:"We have well established divisional businesses, with good, professionalmanagement and a good reputation with our clients. The review that I amundertaking has already highlighted a number of issues which we have begun toaddress. The changes that have been made have been very well received by ourdivisional management who enter 2005 determined to return our Group to growthand profitability as market conditions improve." - Ends - Enquiries:Financial Dynamics Telephone: 020 7831 3113 Giles Sanderson Harriet Keen Cass Helstrip ENDRelated Shares:
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