Unaudited Interim Results

29 July 2025

("Staffline", the "Company" or the "Group")

UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2025

- Strong financial performance reflects market leading position

- Staffline continues to perform in-line with management expectations, underpinned by solid new business pipeline

Staffline (AIM: STAF), the recruitment group, announces its unaudited interim results for the six months ended 30 June 2025 ("H1 2025" or the "Period").

Financial highlights

*Restated to exclude the results of PeoplePlus, which was sold on 24 February 2025.

Alternative performance measures

1. Gross sales value represents the fair value of consideration received or receivable for the supply of services, including agency sales, (excluding fees), net of VAT.

2. Underlying results exclude goodwill impairment, reorganisation costs and other non-underlying charges.

3. On a Post-IFRS16 basis, net debt was £(9.9)m at 30 June 2025 (2024: net debt £(14.5)m).

Key highlights:

· Revenue growth of 8.7% to £485.8m (H1 2024: £446.8m) supported by excellent new business momentum in the Period

· Increase of over 50% in underlying operating profit to £3.7m (H1 2024: £2.4m) highlighting Staffline's operational strength as a pure-play recruitment platform

· Performance underpinned by a 4.4% increase in temporary hours worked in Recruitment GB and a 23.1% increase in permanent recruitment activities in Ireland

· Strategic partnership with a leading food and drink logistics provider announced in the Period, increasing market share and solidifying Staffline's reputation as a trusted provider

· Transition to a pure-play recruitment platform, following the divestment of PeoplePlus, which completed in February

· Launched a Share buyback programme of up to £7.5m, repurchasing a total consideration of £4.8m in the Period

Current trading and outlook

· Staffline's pure-play recruitment platform continues to remain resilient, despite ongoing macroeconomic headwinds, with market share gains and new logistics contracts to come on stream in H2 2025

· Strong balance sheet and track record of cash generation, underpins the Board's disciplined capital allocation policy and ongoing commitment to delivering shareholder value

· Positive trading momentum has continued into H2 2025 with the Group currently on track to deliver results in line with current management expectations

Albert Ellis, Chief Executive Officer of Staffline, commented:

"I am delighted that the Group has produced such a strong financial and operational performance in the first half of the year. Pleasingly, Staffline continues to secure new business and grow our market share despite the ongoing challenging macro-economic backdrop within the UK economy.

Having now created a leading pure-play recruitment platform across both the blue and white-collar recruitment markets, following the divestment of PeoplePlus, we are ideally placed to continue to capitalise on a number of exciting new organic growth opportunities."

Retail investor webcast

Management will be hosting a presentation for investors in relation to the Company's interim results at 9.00am (BST) on Tuesday, 29 July 2025.

The presentation will be hosted on the Investor Meet Company ("IMC") digital platform and is open to all existing and potential shareholders. Investors can sign up to IMC for free and add themselves to meet Staffline via: https://www.investormeetcompany.com/staffline-group-plc/register-investor

Investors who have already registered with IMC will be automatically invited.

For further information, please contact:

About Staffline

Staffline is one of the UK's leading Recruitment groups. It has two divisions:

· Recruitment GB

The Recruitment GB business is a leading provider of flexible blue-collar workers, supplying c.35,000 staff per day on average from around 400 sites, across a wide range of industries including supermarkets, drinks, driving, food processing, logistics and manufacturing.

· Recruitment Ireland 

The Recruitment Ireland business is a leading end to end solutions provider operating across multiple industries, ten branch locations and ten onsite customer locations, supplying c.4,500 staff per day on average, and offering RPO, MSP, temporary and permanent solutions across public and private sectors throughout the island of Ireland.

Chief Executive Officer's Review

Introduction

I am pleased to report a strong financial performance in H1 2025, with our core blue-collar recruitment businesses performing well and in line with current management expectations. 

Revenue increased 8.7% to £485.8m (H1 2024: £446.8m), with gross margin of 6.8% (H1 2024: 7.0%). Gross profit was up 6.1% at £33.1m (H1 2024: £31.2m), and underlying operating profit increased by 54.2% to £3.7m (H1 2024: £2.4m) following the strategic disposal of PeoplePlus and a resilient performance from recruitment businesses, Recruitment GB and Recruitment Ireland.

Our recruitment businesses continue to perform well, and above current levels of demand being experienced across the market delivering organic growth across the Group, as we leverage our reputation as a large-scale trusted recruitment solutions provider. This excellent trading performance has been supported by Recruitment GB increasing temporary worker hours worked year-on-year by 4.4%, alongside an increase in Recruitment Ireland's permanent hiring fees from high-margin white-collar roles. Both divisions secured new mandates, including a substantial contract with a leading food and drink logistics provider to outsource 100% of agency labour services to Recruitment GB.

The Group maintains a strong balance sheet and has utilised proceeds from the disposal of PeoplePlus and strong trading cash flows over the last 12 months to initiate its 2025, £7.5m share buyback programme. To date, 15.5 million ordinary shares have been repurchased, at an average price of 31.2 pence per ordinary share, for a total consideration of £4.8m, demonstrating the Board's disciplined capital allocation policy.

Market

The UK recruitment market continues to be affected by broader macroeconomic headwinds, reflected in reduced hiring activity and staff attrition across numerous sectors in both the UK and Ireland.

UK unemployment has marginally increased to 4.7% as job vacancies continue to decline, falling below pre-pandemic levels, currently around 727,000. This represents a decrease of 56,000 versus the previous quarter.

White-collar recruitment, to which our Ireland division is more exposed, has been affected by a decline in business and candidate confidence, combined with higher labour costs. By contrast, blue-collar temporary recruitment, which accounts for 90.0% of Group gross profit, remains resilient in key defensive sectors such as Staffline's core food and drinks and logistics sectors.

Staffline has successfully mitigated the majority of these challenges in H1 2025 by working with our customers to provide agile solutions to their labour requirements and mitigating growing cost pressures.

Strategy

With the transition to a focused, pure-play recruitment platform following the divestment of PeoplePlus in February, the Group continues to deliver against its strategic priorities:

· Strengthening the Group's market-leading position by leveraging Staffline's scale, reach and excellence in delivery to grow market share in blue-collar temporary recruitment organically.

· Broaden our portfolio by growing, where appropriate, white-collar and adjacent permanent recruitment activity, including managed services.

· Continue to expand in the Republic of Ireland by securing new contracts and growing the Group's market share.

· Increase shareholder returns whilst maintaining a healthy balance sheet and returning excess cash to shareholders in the form of share buybacks directly from annual trading cashflows.

We believe that our strategy has enabled the Group to navigate the currently challenging macroeconomic backdrop whilst simultaneously delivering our organic growth strategy and providing accelerated cash returns to shareholders.

Operational review

Staffline's market-leading recruitment businesses performed well during the Period, with the strong momentum experienced in 2024 continuing, delivering significant operational and financial progress despite the challenging market backdrop.

Recruitment GB

Recruitment GB has delivered an excellent trading performance in H1 2025, with an uplift in revenue and gross profit of 11.4% and 8.5% respectively. This has been underpinned by a 4.4% increase in temporary worker hours worked year-on-year, indicative of the sustained demand for Staffline's temporary and agency recruitment solutions. Pleasingly, underlying operating profits are ahead by 71.4%, supported by a focused cost reduction programme improving divisional gross profit to underlying operating profit conversion from 11.3% to 17.9%. 

Organic growth remains at the centre of our strategy. In May, the Group secured a significant strategic partnership with a leading UK food and drink supply chain management and logistics provider to outsource 100% of agency labour services to Staffline, which is expected to have a material impact on the Group's performance over the life of the contract. This partnership includes the deployment of c.3,000 temporary workers across driving, warehousing and security activities, significantly expanding the Group's operational footprint. Staffline has worked closely with the leadership team, delivering a seamless transition, and is now embedded within operations, with the majority of activities expected to be fully integrated by August 2025.

Recruitment GB continues to pursue a range of further new business opportunities, some of which could complete across H2 2025, with both new and existing customers. Additionally, our M&S operations are expected to return to full capacity following the recent cyber-attack, strengthening the performance of the division across the remainder of the financial year.

We have continued to focus on maximising efficiencies and generating economies of scale across the business through the implementation of a cost reduction programme to reduce annual costs by c.£3m, mitigating the impact of higher labour costs and ongoing inflationary pressures.

The division has maintained a strong permanent recruitment delivery capability in anticipation of an economic upturn in due course. We have also leveraged Datum RPO, our managed service provider, to support with audit and supply chain consolidation, for which we have seen increased demand given the currently challenging market.

Recruitment Ireland

Our Recruitment Ireland division has reported a swing in the mix of services in favour of permanent recruitment solutions. Whilst revenue and demand from temporary worker placements decreased, permanent revenue increased by an excellent 23.1% year on year. This trend has been driven by the business in the Republic of Ireland, and in particular the ongoing An Garda contract (Republic of Ireland Police Service).

Reduced demand in the public sector, particularly in Northern Ireland, and a higher percentage of white-collar recruitment than the Recruitment GB business has led to a decline in overall results with the performance in H1 2025 below that of H1 2024. However, management anticipates this improving in H2 2025 as issues in relation to pipeline delays resolve, combined with a further restructuring programme implemented in H1 2025.

Outlook

The Group delivered a strong performance across H1 2025, which is expected to continue into the remainder the current financial year.

Our organic growth strategy continues to generate a strong new business pipeline, underpinned by our market leading position in the blue-collar recruitment market and reputation for exceptional service.

The Board is pleased with the Group's current trading performance, and despite the challenging recruitment market, remains confident that trading in FY 2025 remains in line with management expectations.

Albert Ellis

Chief Executive Officer

28 July 2025

Financial Review

Introduction

The Group delivered strong results driven by increasing temporary worker hours in the Period, notwithstanding ongoing challenges in the domestic consumer market. Additionally, permanent recruitment activities remained robust in contrast to market peers. The Group's balance sheet remains strong with reduced pre-IFRS16 net debt of £(5.7)m (2024: £(9.2)m). Following receipt of the proceeds of £4.9m from the disposal of PeoplePlus on 24 February 2025, the Group also launched a share buyback programme, repurchasing shares for total consideration of £4.8m in the Period. Significant headroom of £66.5m (2024: £50.2m) exists in the Group's banking facilities alongside material headroom in financial covenants.

In the Group's Annual Report for the year ended 31 December 2024, the disposal of PeoplePlus, which is described more fully below, led to its treatment as a discontinued operation. The results disclosed in this review relate to continuing activities and comparatives have been restated where applicable.

Trading performance

Total revenue for H1 2025 increased by 8.7% to £485.8m (2024: £446.8m) due to increased temporary worker hours, which were up 4.4% in Recruitment GB, predominately in the food retail and distribution sectors. Gross profit increased to £33.1m (2024: £31.2m) accompanied by a small decrease in gross margin to 6.8% from 7.0% in 2024. The reduction in gross margin % is as a result of a combination of pay inflation from National Minimum Wage and Employers' National Insurance increases, reflected in higher wages that go through revenue, and the increase in temporary worker hours in sectors where the margin is comparatively low.

Underlying divisional performance

Following the disposal of PeoplePlus, the Group comprises two divisions: Recruitment GB and Recruitment Ireland.

1 Gross sales value represents the fair value of consideration received or receivable for the supply of services, including agency sales, (excluding fees) net of VAT.

Key performance indicators (continuing activities)

For management reporting purposes, the Recruitment GB division presents its 'gross sales', which includes sales under agency arrangements. The reporting of gross sales gives an indication of the full level of activity undertaken by the division. The value is adjusted for revenue reporting in accordance with IFRS15. The adjustment relative to reported revenue for the Group is as follows:

Revenues in the Recruitment GB division increased by £44.9m, (11.4%), to £437.9m (2024: £393.0m). The increase is predominately from organic growth with existing customers, mainly in the logistics and distribution sector. This new business has been won based on quality of service and performance by the business driving the growth in market share.

The gross profit for Recruitment GB increased 8.5% year-on-year, from £24.7m in 2024 to £26.8m, with the gross margin % decreasing slightly from 6.3% in H1 2024 to 6.1% this year. This was adversely impacted by a 6.7% increase in the National Living Wage from April 2025, from £11.44 to £12.21, which follows on from a 9.8% increase the year before. This does not impact absolute gross profit, as the increase is passed through to customers but does adversely impact the gross margin % achieved. Gross profit margin % was also impacted by the slight reduction in permanent recruitment, which generated gross profit of £1.7m (2024: £2.0m).

Revenues in the Recruitment Ireland division decreased by £5.9m (-11.0%) to £47.9m (2024: £53.8m), mainly reflecting a reduction in onsite temporary recruitment activity, as well as weak public sector activity driven by lacklustre investment at government level. The gross profit for Recruitment Ireland decreased by 3.1% from £6.5m in H1 2024 to £6.3m in H1 2025, whilst the gross profit margin % increased from 12.1% to 13.2%. This gross margin % improvement was supported by an increase in permanent recruitment gross profit of 23.1% with £1.6m of gross profit in H1 2025 compared to £1.3m in H1 2024, reflecting the growing business in the Republic of Ireland, and in particular the ongoing An Garda contract (Republic of Ireland Police Service).

Group underlying operating profit increased by 54.2% to £3.7m (2024: £2.4m), with gross profit to underlying operating profit conversion increasing to 11.2% compared to 7.7% in H1 2024. The Group expects underlying operating profit to be H2 weighted due to the main peak trading period in the lead up to Christmas and the New Year.

Discontinued operation

During 2024, partly as a result of the general election, the pipeline for new contracts and the timing of tender results stalled considerably, impacting the prospects for the PeoplePlus division. Following an approach from Swipejobs Holdings Pty Ltd, negotiations for the disposal commenced during H2 2024, culminating in the disposal of the wholly owned subsidiary, PeoplePlus Group Ltd, on 24 February 2025.

The consideration for the sale was £12.0m, including £2.0m of deferred consideration. The consideration was on a cash-free, debt-free basis, subject to a deduction of £5.1m of advanced payments received for future revenue. The net proceeds of the disposal (including the deferred consideration) were £6.9m, of which £4.9m has been received in cash to date. The £2.0m of deferred consideration is contingent on the commencement of potential new contracts expected to take place within the 15 months following the date of this statement.

Further details are provided in note 5.

Finance costs and interest rate hedge

Net finance costs were £2.7m (2024: £2.1m), which includes £0.1m (2024: £0.2m) of non-cash charges for amortisation of debt re-financing costs. Gross finance costs were actually lower than prior year as a result of the reduction in Bank of England base rate from 5.25% to 4.25% since August 2024, but the ending of the interest rate cap instrument in October 2024 led to the increase in net costs.

Profit before taxation

The Group's reported profit before taxation of £0.6m in H1 2025 compares to a profit of £0.3m in 2024.

Taxation

There is a £0.2m tax charge (2024: charge £0.1m) for the Period due to the movement on deferred tax balances.

The reported profit after tax on continuing activities for H1 2025 is £0.4m (2024: profit £0.2m).

Statement of financial position, cash generation and financing

The Group ended H1 2025 with pre-IFRS16 net debt of £(5.7)m (2024: £(9.2)m). Post-IFRS16 net debt was £(9.9)m at H1 2025 (2024: £(14.5)m). The movement in net debt is shown in the table below. The change in working capital includes the Q1 VAT payment, representing VAT collections in the Group's peak seasonal Q4 2024 trading period. Good trading cash generation in the Period driven by the organic growth in Recruitment GB temporary hours worked, has been offset by the required working capital usage. The proceeds of the sale of PeoplePlus enabled the purchase of the Company's own shares under a new share buyback scheme.

*This represents cash collected from trade receivables and remitted for payables, paid on disposal of PeoplePlus.

The table below reconciles underlying EBITDA (earnings before interest, taxation, depreciation and amortisation), to operating loss.

*Restated to exclude the results of PeoplePlus, which was sold on 24 February 2025.

Note: Underlying operating profit is stated before goodwill impairment and reorganisation costs.

The Group's banking facility headroom under its available committed banking facilities is set out below:

Banking facilities

The Group manages its working capital requirements using a Receivables Finance Agreement ("RFA"), and a number of separate, non-recourse, customer financing arrangements whereby specific customers' invoices are settled in advance of their normal settlement date via a funding intermediary.

The RFA leverages the Group's trade receivables with sufficient headroom and flexibility to manage the variability and size of weekly cash outflows. The key terms of the facility are set out below:

i) maximum receivables financing facility of £60.0m over a four-year term, with a one-year extension option;

ii) an Accordion option of up to an additional £20.0m, subject to lender approval;

iii) security on all of the assets and undertakings of the Company and certain subsidiary undertakings;

iv) interest accruing at a maximum of 2.25% over SONIA, with a margin ratchet downward to 1.5%, dependent upon the Group's leverage reducing to less than 1.00x;

v) a non-utilisation fee of 0.35%;

vi) maximum net debt (averaged over a rolling three months) to EBITDA leverage covenant of 4.0x; and

vii) minimum interest cover covenant of 2.25x the last 12 months EBITDA to finance charges.

The estimated balance funded under the customer finance arrangements at 30 June 2025 was £43.8m (2024: £58.2m).

Purchases of own shares

The Group has delivered four years of annual underlying operating profits of at least £10.0m and annual operating cash generation remains strong. During the last 12 months the Board has taken the opportunity to make share purchases under share buyback programmes and for the Employee Benefit Trust. The Group continues to have substantial headroom of £66.5m (2024: £50.2m) under its available banking facilities.

Pursuant to an announcement of the launch of a share buyback programme on 10 June 2024 the Company repurchased 6,860,792 ordinary shares in the capital of the Company (the "Ordinary Shares") at a cost of £2.5m. On 25 February 2025 the Group announced the commencement of a buyback programme to be carried out in two tranches, the first being for 15,517,851 ordinary shares and the second being for 12,440,000 ordinary shares. The second tranche being subject to approval of the relevant resolution at the Company's 2025 Annual General Meeting.

Tranche 1 of the buyback programme completed on 11 April 2025, having purchased 15,517,851 ordinary shares for a total consideration of £4,843,094, at an average price of 31.2p per ordinary share.

At the Company's AGM on 21 May 2025, the members approved a resolution to purchase the Company's ordinary shares up to a maximum number of 19,021,847. On 22 May 2025 the Group announced launch of tranche 2 of the 2025 buyback programme for the acquisition of up to 12,400,000 ordinary shares. Up to the date of this report, no further ordinary shares have been acquired.

The Ordinary Shares purchased pursuant to the share buyback programmes have been cancelled.

Dividend policy

No interim dividend for 2025 is proposed (2024: £nil).

Going concern

The Directors have formed a judgement, at the time of approving the unaudited condensed interim Group financial statements, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence and meet its liabilities as they fall due over the assessment period. The Directors have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern for a period of at least eighteen months from when the unaudited condensed interim Group financial statements are authorised for issue. For this reason, the Directors continue to adopt the going concern basis in preparing the financial statements.

International Financial Reporting Standards

There have been no new accounting standards or interpretations in the first half of 2025 which materially impact the Group's reported performance or financial position.

Daniel Quint

Chief Financial Officer

28 July 2025

Consolidated statement of comprehensive income

For the six months ended 30 June 2025

1 Restated to exclude the results of PeoplePlus, which was sold on 24 February 2025.

2 For details of the restatement, refer to note 5.

The accompanying notes form an integral part of these unaudited condensed interim Group financial statements.

Consolidated statement of changes in equity

For the six months ended 30 June 2025

Consolidated statement of changes in equity

For the six months ended 30 June 2024

The accompanying notes form an integral part of these unaudited condensed interim Group financial statements.

Consolidated statement of changes in equity

For the year ended 31 December 2024

*For details of the restatement, refer to note 5.

The accompanying notes form an integral part of these unaudited condensed interim Group financial statements.

Consolidated statement of financial position

As at 30 June 2025

*For details of the restatement, refer to note 5.

The accompanying notes form an integral part of these unaudited condensed interim Group financial statements.

Consolidated statement of cash flows

For the six months ended 30 June 2025

*This represents cash collected from trade receivables and remitted for payables, paid on disposal of PeoplePlus.

The accompanying notes form an integral part of these unaudited condensed interim Group financial statements.

Notes to the summary financial statements

For the six months ended 30 June 2025

1 Interim accounts and accounting policies

Staffline Group plc, a Public Limited Company, is incorporated and domiciled in the United Kingdom.

The unaudited condensed interim Group financial statements for the six-month period ended 30 June 2025 (including the comparatives for the six-month period ended 30 June 2024 and the year ended 31 December 2024) were approved and authorised for issue by the Board of Directors on 28 July 2025.

It should be noted that accounting estimates and assumptions are used in the preparation of the interim financial information. Although these estimates are based on management's best knowledge and judgement of current events, actual results may ultimately differ from those estimates. The unaudited condensed interim Group financial statements have been prepared using the accounting policies as described in the December 2024 audited year-end Annual Report and have been consistently applied.

The interim Group financial information contained within this report does not constitute statutory accounts as defined in the Companies Act 2006, section 434. The full accounts for the year ended 31 December 2024 received an unqualified report from the auditors and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies.

Basis of preparation

The unaudited interim Group financial statements, which should be read in conjunction with the audited Annual Report for the year ended 31 December 2024, have been prepared in accordance with AIM Rules for Companies - Part One, Section 18 "Half-yearly reports".

The unaudited condensed interim Group financial statements consolidate those of the parent company and all its subsidiaries as at 30 June 2025. Subsidiaries are all entities to which the Group is exposed, or has rights, to variable returns and has the ability to affect those returns through power over the subsidiary.

The unaudited condensed interim Group financial statements have been prepared on a going concern basis using the significant accounting policies and measurement bases summarised in the December 2024 audited year-end Annual Report, and in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and with the Companies Act 2006, as applicable to companies reporting under IFRS. The financial statements are prepared under the historical cost convention except for equity-settled share options, derivative financial instruments and the retirement benefit net asset, which are measured at fair value. The consolidated financial statements are presented in sterling, which is also the functional currency of the parent company.

Going concern

The Directors have formed a judgement, at the time of approving the unaudited condensed interim Group financial statements, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence and meet its liabilities as they fall due over the assessment period. The Directors have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern for a period of at least 18 months from when the unaudited condensed interim Group financial statements are authorised for issue. For this reason, the Directors continue to adopt the going concern basis in preparing the unaudited condensed interim Group financial statements.

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

2 Segmental reporting

Management currently identifies two reportable segments: Recruitment GB, the provision of workforce recruitment and management to industry and Recruitment Ireland, the provision of generalist recruitment services. The Group's skills training and employability services provider, PeoplePlus, was sold on 24 February 2025 and is classed as a discontinued operation. The Group's reportable segments are determined based on the Group's internal reporting to the Chief Operating Decision Maker ("CODM"). The CODM has been determined to be the Group Chief Executive Officer, with support from the Board.

Segment information for the reporting half-year is as follows:

*Restated to show the results of PeoplePlus, which was sold on 24 February 2025, as a discontinued operation.

Note: Segment underlying operating profit before goodwill impairment and other non-underlying costs.

*Restated to show the results of PeoplePlus, which was sold on 24 February 2025, as a discontinued operation.

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

2 Segmental reporting (continued)

Segment information for the year ended 31 December 2024 is as follows:

The analysis above excludes deferred tax assets and liabilities, as required by IFRS 8, Operating segments.

3 Non-underlying expenses

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

4 Earnings per share and dividends

Earnings per share

The calculation of basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period, after deducting any shares held by the Employee Benefit Trust ("EBT") - "own shares" (7,627,198 shares at 30 June 2025, 8,535,706 shares at 31 December 2024 and 7,583,206 shares at 30 June 2024). The calculation of the diluted earnings per share is based on the basic earnings per share as adjusted to further take into account the expected issue of ordinary shares resulting from any share options granted to Executive Directors and certain senior employees, and share options granted to employees under the SAYE scheme.

Details of the earnings and weighted average number of shares used in the calculations are set out below:

1 Restated to exclude the results of PeoplePlus, which was sold on 24 February 2025.

2 For details of the restatement, refer to note 5.

Note: Underlying earnings after adjusting for goodwill impairment and other non-underlying costs.

Dividends

No interim dividend for 2025 is proposed (2024: £nil).

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

5 Disposal of PeoplePlus Group Ltd (PeoplePlus division)

On 24 February 2025, the Group sold its wholly owned subsidiary PeoplePlus Group Ltd, which represented the PeoplePlus division, for cash consideration of £12.0m, which includes £2.0m of deferred consideration. The consideration was on a cash-free, debt-free basis and was subject to a deduction of £5.1m of advanced payments received in respect of future revenue. The net proceeds of the disposal (including the deferred consideration) were £6.9m, of which £4.9m in cash has been received to date. The £2.0m of deferred consideration is contingent on the commencement of potential new contracts expected to take place within the 15 months following the date of this statement.

PeoplePlus was classified as held for sale in the Group's 2024 Annual Report and as a discontinued operation in the Group's consolidated statement of comprehensive income for that year, in accordance with IFRS 5.

At the date of disposal, the carrying amounts of assets and liabilities of PeoplePlus were as follows:

Prior year adjustment

At 31 December 2024, the goodwill impairment calculation did not take into account a £2.5m favourable working capital position which, had it been properly considered, would have increased the loss on discontinued operations from £12.4m to £14.9m. A prior year adjustment has been made in respect of this item. There is no effect on the consideration receivable as a result of this adjustment.

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

6 Goodwill

The breakdown of Goodwill carrying value by division is listed below:

7 Trade and other receivables

8 Derivative financial instruments

Effective from 14 October 2024, the Group entered into an amortising interest rate collar instrument, comprising:

• a cap element to reduce exposure to interest rate increases above 4.75% above SONIA on an aggregated two-thirds of the RFA and the customer finance arrangements, and,

• a floor element, based on the same nominal values and over the same period as the cap, to pay the issuer the differential if the SONIA interest rate falls below 2.51%.

The instrument, which has a term of five years from 14 October 2024, is based on quarterly notional amounts varying between £58.9m and £77.3m, with an average of £68.6m. The instrument was acquired for no upfront premium.

In October 2021 the Group entered into an amortising interest rate cap instrument, which reduced exposure to interest rate increases above 1% of SONIA on an aggregated two-thirds of the Receivables Finance Agreement and the customer finance arrangements. The instrument, which expired on 13 October 2024, was based on quarterly notional amounts varying between £39.5m and £62.5m, with an average of £51.9m.

Notes to the summary financial statements (continued)

For the six months ended 30 June 2025

9 Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and balances with banks only. All cash on hand and balances with banks are held by subsidiary undertakings but these balances are available for use by the Group.

Long term credit ratings for the banks used by the Group are currently as follows:

The Group's banking facility headroom is as follows:

10 Trade and other payables