TIDMCPS
RNS Number : 2292G
CPL Resources PLC
28 January 2010
Cpl RESOURCES plc
Results for the Half Year Ended 31 December 2009
Cpl Resources plc, Ireland's leading employment services group, today announced
results for the half year ended 31st December 2009.
Financial results
+----------------------------------------+--------------------+---------------------+
| | Half Year ended | Half Year ended |
+----------------------------------------+--------------------+---------------------+
| | 31-Dec-09 | 31-Dec-08 |
+----------------------------------------+--------------------+---------------------+
| Operating highlights | EUR000 | EUR000 |
+----------------------------------------+--------------------+---------------------+
| | ( Unaudited) | ( Unaudited) |
+----------------------------------------+--------------------+---------------------+
| | | |
+----------------------------------------+--------------------+---------------------+
| Revenue | 91,378 | 118,945 |
+----------------------------------------+--------------------+---------------------+
| Gross profit | 12,958 | 20,517 |
+----------------------------------------+--------------------+---------------------+
| Profit before tax and Impairment | 2,374 | 6,022 |
+----------------------------------------+--------------------+---------------------+
| Goodwill Impairment | | (4,500) |
+----------------------------------------+--------------------+---------------------+
| Profit Before tax | 2,374 | 1,522 |
+----------------------------------------+--------------------+---------------------+
| EPS | 11.0 cent | 2.0 cent |
+----------------------------------------+--------------------+---------------------+
The markets in which we operate remain difficult and employment trends continue
to present challenges. Nevertheless, the Group is pleased to report profits
before tax of EUR2.37 million for the six months ended 31 December 2009.
In the six months to 31 December 2009 Group Gross Profit fell by 37% when
measured against the same period last year. This change reflects the continuing
weakness of the Irish economy. The Group's net fee income for the six months to
December 2009 is 10% lower than the six months to June 2009.
Net fee income from our permanent placement business decreased by 58% when
compared to the corresponding period last year. However, permanent fees
generated in the six months to December 2009 were only 15% lower than the six
months to June 2009. Net fee income in our temporary placement business has been
more resilient to date across most of the Group. Unfortunately the pricing
environment in the temporary placement business has become more challenging.
This has resulted in a 26% decline in gross profit from this sector of our
business compared with the same period last year. We are however beginning to
see an increase in demand for temporary staff, and net fee income in our
temporary business in the six months to December 2009 was similar to that
generated in the six months to June 2009.
The Group had cash balances of EUR42 million at 31 December 2009. The business
generated EUR1.7 million from operating activities in the six months to December
2009, while EUR1.3 million was spent on acquisitions in the same period. We
continue to manage our debtor book actively and carefully, and we have not
experienced any significant increase in bad debts.
In line with our stated strategy to increase the range of services we offer to
our customers, we acquired three businesses in the six months to December 2009.
Loss Control Services Limited (trading as Nifast) is one of Ireland's leading
providers of training and consultancy in all aspects of Health & Safety.
Established 22 years ago, Nifast assists companies in reducing the risks of
accidents in the workplace and in managing their compliance with their statutory
duties as employers. Ecom Interaction Services Limited is a business process
outsourcing company for customer contact management, outsourced insurance
administration and back-office processes. It has a blue chip customer base in
the finance, technology and commercial sectors. Techstaff International Limited
is a construction contractor business. Cpl continues to look for suitable
acquisition opportunities which will enhance our service offering to customers
and improve the breadth and geographic balance of our business.
Our goal is to consistently remain profitable regardless of the economic
circumstances. Our team has demonstrated their commitment to delivering a value
based strategy. For this I thank them. Our sales force and delivery teams remain
committed to providing our customers with innovative and flexible solutions to
meet their business needs in a constantly changing environment. We value our
customers and I would also like to thank them for their continued support.
Outlook
The markets in which Cpl operates remain challenging, and the economic outlook
remains uncertain in Ireland and in our other locations. In these conditions we
are continuing to manage our cost base carefully, to provide excellent service
to our clients and to pursue opportunities to add to our business as they arise.
We do not anticipate any significant expansion or retraction in demand for our
services in the short term. We note, however, that some commentators are
forecasting a return to economic growth in Ireland towards the end of 2010, and
we remain well positioned to take advantage of any upturn in the market as and
when it occurs.
The Board is recommending an interim dividend of 1.5 cent per share. The
dividend will be payable on 5th March 2010 to shareholders on the company's
register at the close of business on the record date of 5th February 2010.
John Hennessy
+--------------------------------+
| Group income statement |
+--------------------------------+
| for the period ended 31st |
| December 2009 |
+--------------------------------+
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| | Half Year ended | Half Year | Year ended |
| | | ended | |
+--------------------------------+-----------------+----------------+--------------+
| | 31 Dec 2009 | 31 Dec 2008 | 30 Jun 2009 |
+--------------------------------+-----------------+----------------+--------------+
| | EUR'000 | EUR'000 | EUR'000 |
+--------------------------------+-----------------+----------------+--------------+
| | ( Unaudited) | ( Unaudited) | (Audited) |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Revenue | 91,378 | 118,945 | 212,398 |
+--------------------------------+-----------------+----------------+--------------+
| Cost of sales | (78,420) | (98,428) | (177,410) |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Gross profit | 12,958 | 20,517 | 34,988 |
+--------------------------------+-----------------+----------------+--------------+
| Distribution expenses | (762) | (982) | (1,575) |
+--------------------------------+-----------------+----------------+--------------+
| Administrative expenses before | (10,514) | (14,344) | (25,209) |
| impairment charge | | | |
+--------------------------------+-----------------+----------------+--------------+
| Operating profit before | 1,682 | 5,191 | 8,204 |
| impairment charge | | | |
+--------------------------------+-----------------+----------------+--------------+
| Impairment | - | (4,500) | (8,061) |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Operating profit | 1,682 | 691 | 143 |
+--------------------------------+-----------------+----------------+--------------+
| Financial income | 694 | 832 | 1,552 |
+--------------------------------+-----------------+----------------+--------------+
| Financial expenses | (2) | (1) | (12) |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Profit before tax | 2,374 | 1,522 | 1,683 |
+--------------------------------+-----------------+----------------+--------------+
| Income tax expense | (309) | (783) | (1,002) |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Profit for the Financial Year | 2,065 | 739 | 681 |
+--------------------------------+-----------------+----------------+--------------+
| Attributable to: | | | |
+--------------------------------+-----------------+----------------+--------------+
| Equity Shareholders | 2,054 | 697 | 639 |
+--------------------------------+-----------------+----------------+--------------+
| Minority interest | 11 | 42 | 42 |
+--------------------------------+-----------------+----------------+--------------+
| | 2,065 | 739 | 681 |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Basic earnings per share | 11.0 cent | 2.0 cent | 1.7 cent |
+--------------------------------+-----------------+----------------+--------------+
| | | | |
+--------------------------------+-----------------+----------------+--------------+
| Diluted earnings per share | 11.0 cent | 2.0 cent | 1.7 cent |
+--------------------------------+-----------------+----------------+--------------+
Consolidated Balance Sheet
@ 31 December 2009
+--------------------------------+----------------+----------------+---------------+
| | 31 Dec 2009 | 31 Dec 2008 | 30 Jun 2009 |
+ +----------------+----------------+---------------+
| | EUR'000 | EUR'000 | EUR'000 |
+--------------------------------+--------------------------------+----------------+----------------+
| | ( Unaudited) | ( Unaudited) | ( Audited) |
+--------------------------------+----------------+----------------+---------------+
| Assets | | | |
+--------------------------------+----------------+----------------+---------------+
| Non-current assets | | | |
+--------------------------------+----------------+----------------+---------------+
| Property, plant and equipment | 1,426 | 1,436 | 1,444 |
+--------------------------------+----------------+----------------+---------------+
| Goodwill and Intangible assets | 10,668 | 13,875 | 9,979 |
+--------------------------------+----------------+----------------+---------------+
| Deferred tax asset | 229 | 93 | 263 |
+--------------------------------+----------------+----------------+---------------+
| Total non-current assets | 12,323 | 15,404 | 11,686 |
+--------------------------------+----------------+----------------+---------------+
| | | | |
+--------------------------------+----------------+----------------+---------------+
| Current assets | | | |
+--------------------------------+----------------+----------------+---------------+
| Trade and other receivables | 29,666 | 34,387 | 29,424 |
+--------------------------------+----------------+----------------+---------------+
| Cash and cash equivalents | 16,531 | 36,437 | 22,505 |
+--------------------------------+----------------+----------------+---------------+
| Short-term bank deposits | 25,535 | - | 19,995 |
+--------------------------------+----------------+----------------+---------------+
| Corporation tax refundable | 135 | - | 409 |
+--------------------------------+----------------+----------------+---------------+
| Total current assets | 71,867 | 70,824 | 72,333 |
+--------------------------------+----------------+----------------+---------------+
| Total assets | 84,190 | 86,228 | 84,019 |
+--------------------------------+----------------+----------------+---------------+
| | | | |
+--------------------------------+----------------+----------------+---------------+
| Equity | | | |
+--------------------------------+----------------+----------------+---------------+
| Issued capital | 3,720 | 3,720 | 3,720 |
+--------------------------------+----------------+----------------+---------------+
| Share premium | 1,705 | 1,705 | 1,705 |
+--------------------------------+----------------+----------------+---------------+
| Merger reserve | (3,300) | (3,300) | (3,300) |
+--------------------------------+----------------+----------------+---------------+
| Retained earnings | 58,956 | 58,075 | 57,460 |
+--------------------------------+----------------+----------------+---------------+
| | 61,081 | 60,200 | 59,585 |
+--------------------------------+----------------+----------------+---------------+
| Minority Interest | 109 | 98 | 98 |
+--------------------------------+----------------+----------------+---------------+
| Total equity | 61,190 | 60,298 | 59,683 |
+--------------------------------+----------------+----------------+---------------+
| Liabilities | | | |
+--------------------------------+----------------+----------------+---------------+
| Non-current liabilities | | | |
+--------------------------------+----------------+----------------+---------------+
| Financial liabilities | 68 | 56 | 81 |
+--------------------------------+----------------+----------------+---------------+
| Provisions | - | 268 | - |
+--------------------------------+----------------+----------------+---------------+
| Total non-current liabilities | 68 | 324 | 81 |
+--------------------------------+----------------+----------------+---------------+
| Current liabilities | | | |
+--------------------------------+----------------+----------------+---------------+
| Financial liabilities | 32 | 21 | 34 |
+--------------------------------+----------------+----------------+---------------+
| Trade and other payables | 22,870 | 24,401 | 23,814 |
+--------------------------------+----------------+----------------+---------------+
| Corporation tax payable | - | 941 | - |
+--------------------------------+----------------+----------------+---------------+
| Provisions | 30 | 243 | 407 |
+--------------------------------+----------------+----------------+---------------+
| Total current liabilities | 22,932 | 25,606 | 24,255 |
+--------------------------------+----------------+----------------+---------------+
| Total liabilities | 23,000 | 25,930 | 24,336 |
+--------------------------------+----------------+----------------+---------------+
| Total equity and liabilities | 84,190 | 86,228 | 84,019 |
+--------------------------------+----------------+----------------+---------------+
+--------------------------------------------+
| Group Cash Flow statements |
+--------------------------------------------+
| for the period ended 31st December 2009 |
+--------------------------------------------+
+--------------------------------------------+--------------+-------------+-------------+
| | Half Year | Half Year | Year ended |
| | ended | ended | |
+--------------------------------------------+--------------+-------------+-------------+
| | 31 Dec 2009 | 31 Dec 2008 | 30 Jun 2009 |
+--------------------------------------------+--------------+-------------+-------------+
| | EUR'000 | EUR'000 | EUR'000 |
+--------------------------------------------+--------------+-------------+-------------+
| | ( Unaudited) | ( | ( Audited) |
| | | Unaudited) | |
+--------------------------------------------+--------------+-------------+-------------+
| Cash flows from operating activities | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Profit for the financial year | 2,066 | 739 | 681 |
+--------------------------------------------+--------------+-------------+-------------+
| Adjustments for: | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Depreciation on property, plant and | 287 | 274 | 437 |
| equipment | | | |
+--------------------------------------------+--------------+-------------+-------------+
| | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Amortisation of Intangible assets | 83 | 138 | 409 |
+--------------------------------------------+--------------+-------------+-------------+
| Deferred Consideration write back | (317) | | |
+--------------------------------------------+--------------+-------------+-------------+
| Financial income | (694) | (832) | (1,552) |
+--------------------------------------------+--------------+-------------+-------------+
| Financial expense | 2 | 1 | 12 |
+--------------------------------------------+--------------+-------------+-------------+
| Impairment of Goodwill | - | 4,500 | 7,157 |
+--------------------------------------------+--------------+-------------+-------------+
| Impairment of Intangible assets | - | - | 904 |
+--------------------------------------------+--------------+-------------+-------------+
| Income tax expense | 309 | 783 | 1,002 |
+--------------------------------------------+--------------+-------------+-------------+
| Operating profit before changes in working | | | |
| | | | |
+--------------------------------------------+--------------+-------------+-------------+
| capital and provisions | 1,736 | 5,603 | 9,050 |
+--------------------------------------------+--------------+-------------+-------------+
| Decrease/(Increase) in trade and | | | |
+--------------------------------------------+--------------+-------------+-------------+
| other receivables | 483 | 698 | 6,459 |
+--------------------------------------------+--------------+-------------+-------------+
| (Decrease)/Increase in trade and other | (979) | (4,576) | (5,017) |
| payables and provisions | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Cash generated from operations | 1,240 | 1,725 | 10,492 |
+--------------------------------------------+--------------+-------------+-------------+
| Interest paid | (2) | (1) | (12) |
+--------------------------------------------+--------------+-------------+-------------+
| Income tax refund/(paid) | - | (28) | (1,852) |
+--------------------------------------------+--------------+-------------+-------------+
| Interest received | 495 | 666 | 1,405 |
+--------------------------------------------+--------------+-------------+-------------+
| Net cash from operating activities | 1,733 | 2,362 | 10,033 |
+--------------------------------------------+--------------+-------------+-------------+
| Cash flows from investing activities | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Acquisition of subsidiary, net of cash | (1,198) | - | (760) |
| acquired | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Deferred consideration paid | (127) | (2,361) | (2,416) |
+--------------------------------------------+--------------+-------------+-------------+
| Purchase of property, plant and equipment | (199) | (170) | (340) |
+--------------------------------------------+--------------+-------------+-------------+
| Purchase of intangible assets | (70) | - | (75) |
+--------------------------------------------+--------------+-------------+-------------+
| Purchase of investments | (5,540) | - | (19,995) |
| Transfer to short-term deposits | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Net cash used in investing activities | (7,134) | (2,531) | (23,586) |
+--------------------------------------------+--------------+-------------+-------------+
| | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Cash flows from financing activities | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Repayment of borrowings | (15) | (10) | - |
+--------------------------------------------+--------------+-------------+-------------+
| Dividends paid | (558) | (930) | (1,488) |
+--------------------------------------------+--------------+-------------+-------------+
| Proceeds from issue of share capital | - | - | - |
+--------------------------------------------+--------------+-------------+-------------+
| Net cash from financing activities | (573) | (940) | (1,488) |
+--------------------------------------------+--------------+-------------+-------------+
| | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Net increase/(decrease) in cash and cash | (5,974) | (1,109) | (15,041) |
| equivalents | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Cash and cash equivalents at beginning of | 22,505 | 37,546 | 37,546 |
| period / year | | | |
+--------------------------------------------+--------------+-------------+-------------+
| Cash and cash equivalents at end of period | 16,531 | 36,437 | 22,505 |
| / year | | | |
+--------------------------------------------+--------------+-------------+-------------+
Notes supporting interim financial statements
1. Basis of preparation
The consolidated financial information of the Group has been prepared in
accordance with the recognition and measurement principles of International
Financial Reporting Standards (IFRS), including interpretations issued by the
International Accounting Standards Board ("IASB") and its committees and adopted
by the EU.
The figures for the half year ended 31 December 2009 are unaudited. The
comparative figures for the half year ended 31 December 2008 are also unaudited.
The amounts for the year ended 30 June 2009 represent an abbreviated version of
the Group's full financial statements for the year on which the auditors issued
an unqualified audit report.
The preparation of financial information in conformity with IFRS requires
management to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets and liabilities, income
and expenses. The estimates and associated assumptions are based on historical
experience and various other factors that are believed to be reasonable under
the circumstances, the results of which form the basis of making judgements
about carrying values of assets and liabilities that are not readily apparent
from other sources.
2. Dividends to equity shareholders.
+-------------------+-------------+-------------+-------------+
| | Half Year | Half Year | Year ended |
| | ended | ended | |
+-------------------+-------------+-------------+-------------+
| | 31 Dec | 31 Dec | 30 June |
| | 2009 | 2008 | 2009 |
+-------------------+-------------+-------------+-------------+
| | EUR'000 | EUR'000 | EUR'000 |
+-------------------+-------------+-------------+-------------+
| Ordinary | | | |
| dividends: | | | |
+-------------------+-------------+-------------+-------------+
| Interim dividends | - | - | 558 |
| paid | | | |
+-------------------+-------------+-------------+-------------+
| Final dividend | 558 | 930 | 930 |
| paid | | | |
+-------------------+-------------+-------------+-------------+
| | 558 | 930 | 1,488 |
+-------------------+-------------+-------------+-------------+
3. Earnings per ordinary share
The earnings per ordinary share is calculated on the basis that the weighted
average number of shares in issue for the half year ended 31 December 2009 is
37,211,825 (period ended 31 December 2008 - 37,211,825; year ended 30 June 2009
- 37,211,825). It has been calculated based on the profit for the financial
period ended 31 December 2009 of EUR2,054,000 (period ended 31 December 2008 -
EUR697,000; year ended 30 June 2009 - EUR639,000).
4. Provisions
+-------------------------------------------+------------+
| Deferred and contingent consideration | Group |
+-------------------------------------------+------------+
| | EUR'000 |
+-------------------------------------------+------------+
| | |
+-------------------------------------------+------------+
| Balance at 30 June 2009 | 407 |
+-------------------------------------------+------------+
| Amount recognised during the year (note | 67 |
| 5) | |
+-------------------------------------------+------------+
| Paid during the year | (127) |
+-------------------------------------------+------------+
| Revision to estimate during the year | (317) |
+-------------------------------------------+------------+
| Balance at 31 December 2009 | 30 |
+-------------------------------------------+------------+
| Current | 30 |
+-------------------------------------------+------------+
| Non-current | - |
+-------------------------------------------+------------+
| | 30 |
+-------------------------------------------+------------+
5. Acquisition of business undertakings
In July 2009, the Group acquired the businesses and certain assets of Loss
Control Services Limited (trading as Nifast) (in receivership), Ecom Interaction
Services Limited (in receivership), and Techstaff International Limited. The
carrying value of the assets which were acquired, determined in accordance with
IFRS at the acquisition dates was EUR.8 million. Total consideration amounted to
EUR1.2 million.
The initial assignment of fair values to identifiable net assets acquired has
been performed on a provisional basis in respect of the above business
combination. Any amendments to these fair values within the twelve month
timeframe from the date of acquisition will be disclosable in the 2010 Annual
Report as stipulated by IFRS 3, Business Combinations
For Further Information:
Anne Heraty, CEO , CPL Resources, 01 6146000
Josephine Tierney, Finance Director, 01 6146000
Ends
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