TIDMIPEL
RNS Number : 5994Y
Impellam Group plc
07 September 2009
?
7 September 2009
INTERIM FINANCIAL REPORT (UNAUDITED) FOR THE SIX MONTHS ENDED 30 JUNE 2009
Highlights **
Turnover down 2.8% to GBP500.9 million (June 2008: GBP515.5 million ^)
Gross profit down 11.4% to GBP83.6 million (June 2008: GBP94.5 million ^)
Fees from permanent placements down 50.9% to GBP7.9 million (June 2008: GBP15.9
million).
Permanent fees now represent 9.4% of gross profit (June 2008: 17.0%)
Operating costs*** reduced by 14.1% to GBP77.1 million (June 2008: GBP89.8
million ^)
Conversion of gross profit into operating profit improved to 7.8% (June 2008:
5.0%)
Operating profit*** GBP6.5 million (June 2008: GBP4.7 million ^)
Operating profit GBP0.5 million (June 2008: loss GBP0.1 million ^)
Adjusted earnings per share of 10.3p (June 2008: 7.7p ^)***
Unadjusted loss per share of 3.2p (June 2008: 16.4p ^)
The Group generated GBP9.5 million of cash from operations (June 2008: GBP10.9
million) in the first six months
Debtor days have been well controlled at 35.5 days (December 2008: 38.3 days)
Net debt decreased by GBP4.8 million to GBP57.0 million as at 30 June 2009
** comparatives for June 2008 on a pro forma basis (see note 1-III)
*** before exceptional items, share option charges and the amortisation of
intangible assets
^ after adjusting for provisions against revenues of Recruit Event Services
Limited (see note 1 - IV)
Cheryl Jones, Chairman, commented:
"The marked contraction in economic activity in the two principal geographies in
which the group operates required an acceleration of our strategic initiatives,
the rationalisation of business activities and decisive reductions in the cost
base of the Group. Accordingly, although volumes have reduced, group
profitability in the six months to 30 June 2009 has improved when compared to
the same period in 2008."
For further information please contact:
+------------------------------------------+------------------------------------------+
| Impellam Group plc | |
+------------------------------------------+------------------------------------------+
| Cheryl Jones, Chairman | Tel: 01582 692658 |
+------------------------------------------+------------------------------------------+
| Andrew Burchall, Group Finance Director | Tel: 01582 692658 |
+------------------------------------------+------------------------------------------+
| Naomi Stuart, Marketing and | Tel: 01582 692624 |
| Communications Manager | |
+------------------------------------------+------------------------------------------+
| Cenkos Securities plc | |
| (Nominated Advisor and Broker to | |
| Impellam) | |
+------------------------------------------+------------------------------------------+
| Nicholas Wells | Tel: 020 7397 8900 |
+------------------------------------------+------------------------------------------+
| Threadneedle Communications | Tel: 020 7653 9848 |
| John Coles | |
+------------------------------------------+------------------------------------------+
Interim management report
Financial results for the six months to 30 June 2009
The table below sets out the results for the Group by segment for the first half
of 2009 with pro forma comparisons against the same period in the prior year
(see note 1 - III).
+----------------------------+-----------+-----------+----+----+-----------+-----------+----+----+-----------+-----------+
| | Revenue | Gross profit | Operating profit |
+----------------------------+----------------------------+---------------------------------+----------------------------+
| GBPmillion | 2009 | 2008 | % | 2009 | 2008 | % | 2009 | 2008 |
| | | | change* | | | change* | | |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| UK staffing - Commercial | 196.4 | 215.9 | (9.0) | 28.4 | 38.2 | (25.6) | 1.6 | 1.4 |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| UK staffing - Professional | 86.8 | 88.7 | (2.2) | 14.3 | 17.5 | (18.2) | 1.2 | 1.8 |
| & Technical | | | | | | | | |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| UK staffing - Healthcare | 80.8 | 64.7 | 24.9 | 13.0 | 10.0 | 30.0 | 4.5 | 2.2 |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| US staffing | 85.2 | 87.2 | (26.4) | 17.7 | 17.6 | (24.1) | 0.0 | 0.8 |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| UK support services ^ | 51.7 | 59.0 | (12.4) | 10.2 | 11.2 | (9.3) | 0.4 | 1.2 |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| | 500.9 | 515.5 | (2.8) | 83.6 | 94.5 | (11.4) | 7.7 | 7.4 |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| Central costs | | | | | | | (1.2) | (2.7) |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| Operating profit before | | | | | | | 6.5 | 4.7 |
| amortisation of | | | | | | | | |
| intangibles and | | | | | | | | |
| exceptional items | | | | | | | | |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| Amortisation of | | | | | | | (1.7) | (0.7) |
| intangibles | | | | | | | | |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| Exceptional items | | | | | | | (4.3) | (4.1) |
+----------------------------+-----------+-----------+---------+-----------+-----------+---------+-----------+-----------+
| Operating profit /(loss) | | | | | | | 0.5 | (0.1) |
+----------------------------+-----------+-----------+----+----+-----------+-----------+----+----+-----------+-----------+
* measured in local currency
^ 2008 after adjusting for provisions against revenues of Recruit Event Services
Limited (see note 1 - IV)
UK staffing - Commercial: turnover down 9.0% to GBP196.4 million and gross
profit down by 25.6% to GBP28.4 million. Underlying operating profit of the
segment rose to GBP1.6 million.
UK staffing - Professional & Technical: turnover down by 2.2% to GBP86.8 million
with gross profit down by 18.2% to GBP14.3 million and a decrease in operating
profit to GBP1.2 million.
UK staffing - Healthcare: turnover up by 24.9% to GBP80.8 million. Gross profit
in this segment increased by 30.0% to GBP13.0 million and operating profit
increased to GBP4.5 million.
US staffing: turnover fell by 26.4%* to GBP85.2 million, with gross profit
reducing by 24.1%* at GBP17.7 million. Underlying operating profit of the
segment was break-even.
UK support services: turnover down by 12.4% to GBP51.7 million. Gross profit
decreased 9.3% to GBP10.2 million, although the gross margin percentage
increased to 19.7% from 19.0%. Operating profit is down to GBP0.4 million.
Cash flow and net debt
The Group generated GBP9.5 million of cash from operations (June 2008: GBP10.9
million) in the first six months of the year. Net debt has reduced by GBP4.8
million to GBP57.0 million as at June 2009 (December 2008: GBP61.8 million). In
addition, the Group has outstanding letters of credit drawn against its US
borrowing facilities amounting to GBP4.7 million (December 2008: GBP6.1
million).
Cheryl Jones
Chairman
Consolidated income statement
For the six months ended 30 June 2009
+---------------------------------------------------+-------+-------------+-------------+
| | | Statutory | Pro forma |
+---------------------------------------------------+-------+-------------+-------------+
| | | 2009 | 2008 |
+---------------------------------------------------+-------+-------------+-------------+
| | | | restated |
+---------------------------------------------------+-------+-------------+-------------+
| |Notes | GBPm | GBPm |
+---------------------------------------------------+-------+-------------+-------------+
| Continuing operations | | | |
+---------------------------------------------------+-------+-------------+-------------+
| Revenue | 2 | 500.9 | 515.5 |
+---------------------------------------------------+-------+-------------+-------------+
| Cost of sales | | (417.3) | (421.0) |
+---------------------------------------------------+-------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
| Gross profit | | 83.6 | 94.5 |
+---------------------------------------------------+-------+-------------+-------------+
| Administrative expenses | | (83.1) | (94.6) |
+---------------------------------------------------+-------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
| Operating profit/(loss) | 2 | 0.5 | (0.1) |
+---------------------------------------------------+-------+-------------+-------------+
| Operating profit before amortisation and | | 6.5 | 4.7 |
| exceptional items | | | |
+---------------------------------------------------+-------+-------------+-------------+
| Amortisation of customer relationships | | (1.7) | (0.7) |
+---------------------------------------------------+-------+-------------+-------------+
| Exceptional items | 3 | (4.3) | (4.1) |
+---------------------------------------------------+-------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
| Operating profit/(loss) | | 0.5 | (0.1) |
+---------------------------------------------------+-------+-------------+-------------+
| Finance income | | 0.5 | 0.3 |
+---------------------------------------------------+-------+-------------+-------------+
| Finance expense | | (2.4) | (2.9) |
+---------------------------------------------------+-------+-------------+-------------+
| Exceptional finance expense | 3 | - | (0.4) |
+---------------------------------------------------+-------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
| Loss before taxation | | (1.4) | (3.1) |
+---------------------------------------------------+-------+-------------+-------------+
| Taxation | 4 | - | (0.3) |
+---------------------------------------------------+-------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
| Loss for the period (attributable to equity | (1.4) | (3.4) |
| shareholders) | | |
+-----------------------------------------------------------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+-------+-------------+-------------+
+---------------------------------------------------+------+-------------+-------------+
| Earnings/(loss) per share (basic and diluted) | 5 | Pence | Pence |
+---------------------------------------------------+------+-------------+-------------+
| Unadjusted | | (3.2)p | (16.4)p |
+---------------------------------------------------+------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+------+-------------+-------------+
| Adjusted | | 10.3p | 7.7p |
+---------------------------------------------------+------+-------------+-------------+
| | | __________ | __________ |
+---------------------------------------------------+------+-------------+-------------+
Consolidated statement of comprehensive income
For the period ended 30 June 2009
+--------------------------------------------------+-----+--------------+-------------+
| | | Statutory |
+--------------------------------------------------+-----+----------------------------+
| | | 2009 | 2008 |
+--------------------------------------------------+-----+--------------+-------------+
| | | | restated |
+--------------------------------------------------+-----+--------------+-------------+
| | | GBPm | GBPm |
+--------------------------------------------------+-----+--------------+-------------+
| Loss for the period | | (1.4) | (2.0) |
+--------------------------------------------------+-----+--------------+-------------+
| Other comprehensive income: | | | |
+--------------------------------------------------+-----+--------------+-------------+
| (Losses)/gains recognised directly in equity | | | |
+--------------------------------------------------+-----+--------------+-------------+
| Currency translation differences | | (1.7) | (0.1) |
+--------------------------------------------------+-----+--------------+-------------+
| Corporation tax related to currency translation | 1.2 | - |
| differences | | |
+--------------------------------------------------------+--------------+-------------+
| | | __________ | __________ |
+--------------------------------------------------+-----+--------------+-------------+
| Other comprehensive income for the year, net of tax | (0.5) | (0.1) |
+--------------------------------------------------------+--------------+-------------+
| | | __________ | __________ |
+--------------------------------------------------+-----+--------------+-------------+
| Total comprehensive income for the year | (1.9) | (2.1) |
+--------------------------------------------------------+--------------+-------------+
| | | __________ | __________ |
+--------------------------------------------------+-----+--------------+-------------+
Consolidated condensed balance sheet
At 30 June 2009
+------------------------------------------+------+--------------+------------------+
| |
+------------------------------------------+
| | | Statutory |
+------------------------------------------+------+---------------------------------+
| | | 30 June 2009 | 31 December 2008 |
+------------------------------------------+------+--------------+------------------+
| | | | |
+------------------------------------------+------+--------------+------------------+
| | | GBPm | GBPm |
+------------------------------------------+------+--------------+------------------+
| Non-current assets | | | |
+------------------------------------------+------+--------------+------------------+
| Property, plant and equipment | | 7.9 | 8.6 |
+------------------------------------------+------+--------------+------------------+
| Goodwill | | 59.9 | 59.9 |
+------------------------------------------+------+--------------+------------------+
| Other intangible assets | | 53.4 | 55.0 |
+------------------------------------------+------+--------------+------------------+
| Deferred tax assets | | 4.3 | 4.3 |
+------------------------------------------+------+--------------+------------------+
| Financial assets | | 4.2 | 4.8 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| | | 129.7 | 132.6 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Current assets | | | |
+------------------------------------------+------+--------------+------------------+
| Trade and other receivables | | 172.7 | 185.4 |
+------------------------------------------+------+--------------+------------------+
| Cash and short-term deposits | | 8.9 | 11.3 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| | | 181.6 | 196.7 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Total assets | | 311.3 | 329.3 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Current liabilities | | | |
+------------------------------------------+------+--------------+------------------+
| Trade and other payables | | 141.6 | 147.5 |
+------------------------------------------+------+--------------+------------------+
| Taxation liabilities | - | 0.3 |
+-------------------------------------------------+--------------+------------------+
| Bank overdrafts and other short-term borrowings | 45.1 | 51.5 |
+-------------------------------------------------+--------------+------------------+
| Derivative financial instruments | | 0.5 | 0.5 |
+------------------------------------------+------+--------------+------------------+
| Provisions | | 4.7 | 6.3 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| | | 191.9 | 206.1 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Net current liabilities | | (10.3) | (9.4) |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Non-current liabilities | | | |
+------------------------------------------+------+--------------+------------------+
| Long-term borrowings | | 20.8 | 21.6 |
+------------------------------------------+------+--------------+------------------+
| Other payables due in greater than 1 | | 0.6 | 2.0 |
| year | | | |
+------------------------------------------+------+--------------+------------------+
| Provisions | | 9.2 | 8.4 |
+------------------------------------------+------+--------------+------------------+
| Deferred taxation liability | | 15.5 | 16.0 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| | | 46.1 | 48.0 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Total liabilities | | 238.0 | 254.1 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Net assets | | 73.3 | 75.2 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
Consolidated condensed balance sheet (continued)
At 30 June 2009
+------------------------------------------+------+--------------+------------------+
| |
+------------------------------------------+
| | | | |
+------------------------------------------+------+--------------+------------------+
| | | Statutory |
+------------------------------------------+------+---------------------------------+
| | | 30 June 2009 | 31 December 2008 |
+------------------------------------------+------+--------------+------------------+
| | | | |
+------------------------------------------+------+--------------+------------------+
| | | GBPm | GBPm |
+------------------------------------------+------+--------------+------------------+
| Equity | | | |
+------------------------------------------+------+--------------+------------------+
| Issued share capital | | 0.4 | 0.4 |
+------------------------------------------+------+--------------+------------------+
| Share premium | | 15.5 | 15.5 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| | | 15.9 | 15.9 |
+------------------------------------------+------+--------------+------------------+
| Other reserves | | 92.6 | 93.1 |
+------------------------------------------+------+--------------+------------------+
| Retained deficit | | (35.4) | (34.0) |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Total equity attributable to equity | | 73.1 | 75.0 |
| holders of the parent company | | | |
+------------------------------------------+------+--------------+------------------+
| Minority interest | | 0.2 | 0.2 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
| Total equity | | 73.3 | 75.2 |
+------------------------------------------+------+--------------+------------------+
| | | _________ | _________ |
+------------------------------------------+------+--------------+------------------+
Consolidated cash flow statement
For the six months ended 30 June 2009
+----------------------------------------------+-------+--------------+-+---------------+
| |
+----------------------------------------------+
| | | Statutory | Pro forma |
+----------------------------------------------+-------+--------------+-----------------+
| | | 2009 | 2008 |
+----------------------------------------------+-------+--------------+-----------------+
| | | | restated |
+----------------------------------------------+-------+--------------+-----------------+
| |Notes | GBPm | GBPm |
+----------------------------------------------+-------+--------------+-----------------+
| Cash flows from operating activities | | | |
+----------------------------------------------+-------+--------------+-----------------+
| Cash generated by operations | 6 | 9.5 | 10.9 |
+----------------------------------------------+-------+--------------+-----------------+
| Taxation refunded/(paid) | | 0.1 | (0.3) |
+----------------------------------------------+-------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Net cash generated by operating activities | 9.6 | 10.6 |
+------------------------------------------------------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Cash flows from investing activities | | | |
+----------------------------------------------+-------+--------------+-----------------+
| Costs associated with acquisition of CSG | - | (2.0) |
+------------------------------------------------------+--------------+-----------------+
| Purchase of property, plant and equipment (PPE) | (1.3) | (2.6) |
+------------------------------------------------------+--------------+-----------------+
| Purchase of intangible assets | | (0.5) | (0.8) |
+----------------------------------------------+-------+--------------+-----------------+
| Net movement in other financial assets | | (0.1) | - |
+----------------------------------------------+-------+--------------+-----------------+
| Finance income received | | 0.5 | 0.4 |
+----------------------------------------------+-------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Net cash utilised on investing activities | (1.4) | (5.0) |
+------------------------------------------------------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Cash flows from financing activities | | | |
+----------------------------------------------+-------+--------------+-----------------+
| Net movement in other long-term borrowings | | (0.6) | (10.0) |
+----------------------------------------------+-------+--------------+-----------------+
| Net movement in short-term borrowings | | (9.4) | 10.6 |
+----------------------------------------------+-------+--------------+-----------------+
| Capital element of finance lease payments | | (0.2) | (0.2) |
+----------------------------------------------+-------+--------------+-----------------+
| Finance expense paid | | (2.3) | (2.7) |
+----------------------------------------------+-------+--------------+-----------------+
| Dividend in specie via disposal of | | - | (4.0) |
| subsidiary | | | |
+----------------------------------------------+-------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Net cash outflow from financing activities | | (12.5) | (6.3) |
+----------------------------------------------+-------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Net decrease in cash and equivalents | | (4.3) | (0.7) |
+----------------------------------------------+-------+--------------+-----------------+
| Opening cash and cash equivalents | | 8.6 | 5.9 |
+----------------------------------------------+-------+--------------+-----------------+
| Foreign exchange loss on cash and cash equivalents | (1.5) | 0.1 |
+------------------------------------------------------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| Closing cash and cash equivalents | | 2.8 | 5.3 |
+----------------------------------------------+-------+--------------+-----------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-----------------+
| | | 30 June 2009 | 30 June 2008 |
+----------------------------------------------+-------+----------------+---------------+
| Cash and short term deposits | | 8.9 | 7.4 |
+----------------------------------------------+-------+----------------+---------------+
| Bank overdrafts | (6.1) | (2.1) |
+------------------------------------------------------+----------------+---------------+
| | | ________ | ________ |
+----------------------------------------------+-------+----------------+---------------+
| Cash and cash equivalents | | 2.8 | 5.3 |
+----------------------------------------------+-------+----------------+---------------+
| | | ________ | ________ |
+----------------------------------------------+-------+--------------+-+---------------+
Consolidated statement of changes in equity
For the period ended 30 June 2009
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | | Statutory |
+----------------------------------+-------+--------------------------------------------------------+
| | | Total | Other | Retained | Minority | Total |
| | | share | reserves | deficit | interest | equity |
| | | capital | | | | |
| | | and | | | | |
| | | share | | | | |
| | | premium | | | | |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | Notes | GBPm | GBPm | GBPm | GBPm | GBPm |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| 1 January 2009 | | 15.9 | 93.1 | (34.0) | 0.2 | 75.2 |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | | ______ | ______ | ______ | ______ | ______ |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| Currency translation differences | | - | (0.5) | - | - | (0.5) |
| (net of tax) | | | | | | |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| Loss for the period | | - | - | (1.4) | - | (1.4) |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | | ______ | ______ | ______ | ______ | ______ |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| Total comprehensive income for | | - | (0.5) | (1.4) | - | (1.9) |
| the period ended 30 June 2009 | | | | | | |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | | ______ | ______ | ______ | ______ | ______ |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| 30 June 2009 | | 15.9 | 92.6 | (35.4) | 0.2 | 73.3 |
+----------------------------------+-------+----------+----------+----------+----------+------------+
| | | ______ | ______ | ______ | ______ | ______ |
+----------------------------------+-------+----------+----------+----------+----------+------------+
Notes to the interim financial statements
1. Basis of preparation
I. Statement of Compliance
The condensed interim financial statements presented in this financial report
have been prepared in accordance with International Financial Reporting
Standards (IFRS) and International Financial Reporting Interpretations Committee
(IFRIC) interpretations that are expected to be applicable to the consolidated
financial statements for the year ending 31 December 2009. As permitted, this
interim report has been prepared in accordance with AIM Listing Rules and does
not seek to comply with IAS 34 "Interim Financial Reporting".
The standards are subject to ongoing review and endorsement by the European
Union, or possible amendment by interpretive guidance from the International
Accounting Standards Board (IASB), and are therefore still subject to change.
Accordingly, the accounting policies and presentation will be determined finally
only when the consolidated financial statements for the year ending 31 December
2009 are prepared.
II. Statutory information
With the exception of comparative income statement and cash flow information,
the information presented herein is for the Group on a statutory basis.
The statutory financial information, which is unaudited, for the six months to
30 June 2009 does not constitute the statutory accounts of the Group for the
relevant period. The pro forma financial information for the six months to 30
June 2008 has been extracted from the statutory accounts of the Group and the
underlying accounting records prepared in accordance with IFRS.
The published annual report and accounts of Impellam Group plc for the period
ended 31 December 2008 were reported on by the auditors without qualification or
statement under section 237(2) or (3) of the Companies Act 1985 and have been
delivered to the Registrar of Companies.
III. Pro forma financial information
In order to enable a meaningful comparison, the comparative income statement and
cash flow information included in this report for the period to 30 June 2008 has
been included on a pro forma basis for the Group as if the merger of Carlisle
Group Limited ("Carlisle") and The Corporate Services Group plc ("CSG") had
taken place on 1 January 2007 rather than in May 2008.
This treatment does not fully reflect the requirements of IAS 1, Presentation of
Financial Statements - revised, IAS 27, Consolidated and Separate Financial
Statements and IFRS 3, Business Combinations which would require presentation of
the results of Impellam from the date of its incorporation (21 February 2008),
Carlisle from 1 April 2008 and CSG from the date of acquisition by Impellam
Group plc (7 May 2008) to 30 June 2008.
The pro forma financial information, which is unaudited, has been prepared for
illustrative purposes only, through the aggregation of statutory and internal
management financial information of Carlisle and CSG which has otherwise been
prepared in accordance with IFRS. It has not been designed to, and nor does it,
give a presentation of the income statement and balance sheet of the Group that
would have been reported in accordance with IFRS had the combination actually
taken place in 2007.
IV. Restatement
The pro forma financial information has been restated from those originally
reported in June 2008. As fully explained in the 2008 annual report and
accounts, certain accounting irregularities were identified in one of the Group
companies which resulted in provisions being made against revenues and
associated billed and unbilled receivables. These adjustments have impacted the
previously reported pro forma information for June 2008.
V. Accounting policies, new IFRS and interpretations
The accounting policies used in this report are consistent with those applied at
December 2008 with the exception of the following new or revised IFRS
publications that have been adopted in the period:
+----------------------------------------------------------+-------------------+
| International Accounting Standards (IAS / IFRS) | Effective date |
+----------------------------------------------------------+-------------------+
| IAS 1 - Presentation of financial statements (revised) | 1 January 2009 |
+----------------------------------------------------------+-------------------+
| IFRS 8 - Operating segments | 1 January 2009 |
+----------------------------------------------------------+-------------------+
No other new and/or revised IFRS and IFRIC publications, which came into force
in the period have any impact on the Group.
2. Segmental information
The Group is reporting under IFRS 8 for the first time. IFRS 8 - "operating
segments" requires that the Group firstly:
* identifies its "Chief operating decision maker" ("CODM"), which has currently
been assessed as the Group's Chairman, who reviews the Groups internal reporting
in order to assess performance and allocate resources
and secondly:
* by reference to the information supplied to the CODM identify its operating
segments and from these to identify its reportable segments.
The Chairman receives reports and discusses performance with management of the
following five reportable segments:
* UK commercial staffing
* UK professional and technical staffing
* UK healthcare staffing
* US commercial staffing
* UK support services
Statutory
Six months ended 30 June 2009
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Continuing | UK staffing | UK staffing | UK staffing | US | UK | Group |
| operations | - | -Professional | - | staffing | support | total |
| | Commercial | & technical | Healthcare | | services | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | GBPm | GBPm | GBPm | GBPm | GBPm | GBPm |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Segment | 196.4 | 86.8 | 80.8 | 85.2 | 51.7 | 500.9 |
| revenue | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | _______ | _______ | _______ | _______ | _______ | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Segment EBIT | 1.6 | 1.2 | 4.5 | - | 0.4 | 7.7 |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | _______ | _______ | _______ | _______ | _______ | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Unallocated - | | | | | | (1.2) |
| Corporate cost | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Operating | | | | | | 6.5 |
| profit before | | | | | | |
| amortisation | | | | | | |
| and | | | | | | |
| exceptional | | | | | | |
| items | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Amortisation | | | | | | (1.7) |
| of customer | | | | | | |
| relationships | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Exceptional | | | | | | (4.3) |
| items | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Operating | | | | | | 0.5 |
| profit before | | | | | | |
| finance costs | | | | | | |
| and taxation | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Finance costs | | | | | | (1.9) |
| - net | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Loss before | | | | | | (1.4) |
| taxation | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Taxation | | | | | | - |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Loss for the | | | | | | (1.4) |
| period | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
Pro forma
Six months ended 30 June 2008 - restated
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Continuing | UK staffing | UK staffing | UK staffing | US | UK | Group |
| operations | -Commercial | -Professional | - | staffing | support | total |
| | | & technical | Healthcare | | services | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | GBPm | GBPm | GBPm | GBPm | GBPm | GBPm |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Segment | 215.9 | 88.7 | 64.7 | 87.2 | 59.0 | 515.5 |
| revenue | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | _______ | _______ | _______ | _______ | _______ | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Segment EBIT | 1.4 | 1.8 | 2.2 | 0.8 | 1.2 | 7.4 |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | _______ | _______ | _______ | _______ | _______ | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Unallocated - | | | | | | (2.7) |
| Corporate cost | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Operating | | | | | | 4.7 |
| profit before | | | | | | |
| amortisation | | | | | | |
| and | | | | | | |
| exceptional | | | | | | |
| items | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Amortisation | | | | | | (0.7) |
| of customer | | | | | | |
| relationships | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Exceptional | | | | | | (4.1) |
| items | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Operating loss | | | | | | (0.1) |
| before finance | | | | | | |
| costs and | | | | | | |
| taxation | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Finance costs | | | | | | (2.6) |
| - net | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Exceptional | | | | | | (0.4) |
| finance costs | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Loss before | | | | | | (3.1) |
| taxation | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Taxation | | | | | | (0.3) |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| Loss for the | | | | | | (3.4) |
| period | | | | | | |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
| | | | | | | _______ |
+----------------+-------------+---------------+-------------+-----------+-----------+------------+
3. Exceptional items
+---------------------------------------------------------+------------+------------+
| | Statutory | Pro forma |
+---------------------------------------------------------+------------+------------+
| | 2009 | 2008 |
+---------------------------------------------------------+------------+------------+
| | GBPm | GBPm |
+---------------------------------------------------------+------------+------------+
| Restructuring and other costs | 4.3 | 0.7 |
+---------------------------------------------------------+------------+------------+
| Cost associated with the merger | - | 3.0 |
+---------------------------------------------------------+------------+------------+
| Loss on disposal of joint venture or subsidiary and | - | 0.4 |
| impairment of | | |
| Investments | | |
+---------------------------------------------------------+------------+------------+
| | ____ | ____ |
+---------------------------------------------------------+------------+------------+
| Total exceptional items included in operating profit | 4.3 | 4.1 |
+---------------------------------------------------------+------------+------------+
| Financing expenses written off on merger | - | 0.4 |
+---------------------------------------------------------+------------+------------+
| | ____ | ____ |
+---------------------------------------------------------+------------+------------+
| Total exceptional items before tax | 4.3 | 4.5 |
+---------------------------------------------------------+------------+------------+
| Taxation | - | (0.2) |
+---------------------------------------------------------+------------+------------+
| | ____ | ____ |
+---------------------------------------------------------+------------+------------+
| Total exceptional items after tax | 4.3 | 4.3 |
+---------------------------------------------------------+------------+------------+
| | ____ | ____ |
+---------------------------------------------------------+------------+------------+
Restructure costs relate to reorganisation and redundancy costs following a
comprehensive review of structures in both the UK and US in response to the
economic downturn; in 2008 certain rationalisation costs were incurred following
the combination of the two businesses to form Impellam Group plc.
Costs associated with the merger relate to the various legal and professional
costs incurred by both Carlisle Group Limited and The Corporate Services Group
plc to effect the merger of the two businesses under the name of Impellam Group
plc.
In May 2008 the Group sold its 50% interest in a loss making manned guarding
security joint venture in Ireland, Carlisle Security Plus, for a nominal
consideration to the joint venture partner.
The impairment of investment relates to the write down of the carrying value of
the Group's investment in Clear Technology Inc, an unlisted US software
development company.
Finance expenses written off relate to the costs associated with The Corporate
Services Group plc's restructure of debt in 2007 which were being amortised over
the period of the loans and which, on replacement by the new arrangements for
Impellam Group plc, were accelerated and written off in full.
4. Taxation
Income tax expense is recognised based on management's best estimate of the
effective annual income tax rate expected for the full financial year.
5. Earnings/(loss) per share
Basic profit/loss per share amounts are calculated by dividing the profit for
the year attributable to the equity holders of the Company by the weighted
average number of ordinary shares outstanding during the period.
Diluted profit/loss per share amounts are calculated on the same basis, but
after adjusting the denominator for the effects of dilutive options. The only
potentially dilutive shares arise from the share options issued by the Group
under its share-based compensation plans. As the Group has been loss-making, any
share options in issue are considered to be "anti-dilutive" and, as such, there
is no effective change to the earnings per share figures in either period.
The weighted average number of shares has been calculated for the period from 1
January 2009 to 30 June 2009 and from incorporation to 30 June 2008. The number
of shares so calculated is 44,998,882 (June 2008 20,757,580) excluding the
shares owned by The Corporate Services Group Employee Share Trust.
The calculations of (loss)/earnings per share are based upon the following
consolidated income statement data:
+--------------------------------------+-----------+-----------+-----------+-----------+
| |Profit/(loss) for the | Earnings/(loss) per |
| | period | share |
+--------------------------------------+-----------------------+-----------------------+
| | Statutory | Pro | Statutory | Pro |
| | | forma | | forma |
+--------------------------------------+-----------+-----------+-----------+-----------+
| | 2009 | 2008 | 2009 | 2008 |
+--------------------------------------+-----------+-----------+-----------+-----------+
| | | restated | | restated |
+--------------------------------------+-----------+-----------+-----------+-----------+
| | GBPm | GBPm | Pence | Pence |
+--------------------------------------+-----------+-----------+-----------+-----------+
| Basic and diluted | | | | |
+--------------------------------------+-----------+-----------+-----------+-----------+
| Loss for the year | (1.4) | (3.4) | (3.2) | (16.4) |
+--------------------------------------+-----------+-----------+-----------+-----------+
| Exceptional items (net of tax) | 4.3 | 4.3 | 9.6 | 20.7 |
+--------------------------------------+-----------+-----------+-----------+-----------+
| Amortisation of intangible customer | 1.7 | 0.7 | 3.9 | 3.4 |
| relationships | | | | |
+--------------------------------------+-----------+-----------+-----------+-----------+
| | _________ | _________ | _________ | _________ |
+--------------------------------------+-----------+-----------+-----------+-----------+
| Adjusted profit for the year | 4.6 | 1.6 | 10.3 | 7.7 |
+--------------------------------------+-----------+-----------+-----------+-----------+
| | _________ | _________ | _________ | _________ |
+--------------------------------------+-----------+-----------+-----------+-----------+
6. Reconciliation of loss before tax to cash generated by operations
+----------------------------------------------------+---------------+--------------+
| | Statutory | Pro forma |
+----------------------------------------------------+---------------+--------------+
| | 2009 | 2008 |
+----------------------------------------------------+---------------+--------------+
| | | restated |
+----------------------------------------------------+---------------+--------------+
| | GBPm | GBPm |
+----------------------------------------------------+---------------+--------------+
| Loss before taxation | (1.4) | (3.1) |
+----------------------------------------------------+---------------+--------------+
| Adjustments for: | | |
+----------------------------------------------------+---------------+--------------+
| Net interest charge | 1.9 | 2.6 |
+----------------------------------------------------+---------------+--------------+
| Exceptional finance expenses | - | 0.4 |
+----------------------------------------------------+---------------+--------------+
| Depreciation and amortisation | 4.0 | 3.1 |
+----------------------------------------------------+---------------+--------------+
| Other items | - | 0.5 |
+----------------------------------------------------+---------------+--------------+
| | __________ | __________ |
+----------------------------------------------------+---------------+--------------+
| | 4.5 | 3.5 |
+----------------------------------------------------+---------------+--------------+
| Decrease in trade and other receivables | 8.3 | 11.7 |
+----------------------------------------------------+---------------+--------------+
| Decrease in trade and other payables | (3.1) | (3.8) |
+----------------------------------------------------+---------------+--------------+
| Decrease in provisions for liabilities and charges | (0.2) | (0.5) |
+----------------------------------------------------+---------------+--------------+
| | __________ | __________ |
+----------------------------------------------------+---------------+--------------+
| Cash generated by operations | 9.5 | 10.9 |
+----------------------------------------------------+---------------+--------------+
| | __________ | __________ |
+----------------------------------------------------+---------------+--------------+
7. Additional cash flow information
+------------------------+-------------+-------------+-----------+------------+--------------+
| | Statutory |
+------------------------+-------------------------------------------------------------------+
| | 1 January | Cash flow | Foreign | Other | 30 June 2009 |
| | 2009 | | exchange | non-cash | |
| | | | | changes | |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | GBPm | GBPm | GBPm | GBPm | GBPm |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Cash at bank and in | 11.3 | (0.9) | (1.5) | - | 8.9 |
| hand | | | | | |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Overdrafts | (2.7) | (3.4) | - | - | (6.1) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | __________ | __________ | _________ | __________ | __________ |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | 8.6 | (4.3) | (1.5) | - | 2.8 |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | __________ | __________ | _________ | __________ | __________ |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Guaranteed secured | (19.9) | - | - | - | (19.9) |
| loan note | | | | | |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Bank loans | (2.7) | 0.6 | 0.2 | - | (1.9) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Finance leases | (0.5) | 0.2 | - | (0.1) | (0.4) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| Revolving credit | (47.3) | 9.4 | 0.3 | - | (37.6) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | __________ | __________ | _________ | __________ | __________ |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | (70.4) | 10.2 | 0.5 | (0.1) | (59.8) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | __________ | __________ | _________ | __________ | __________ |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | (61.8) | 5.9 | (1.0) | (0.1) | (57.0) |
+------------------------+-------------+-------------+-----------+------------+--------------+
| | __________ | __________ | _________ | __________ | __________ |
+------------------------+-------------+-------------+-----------+------------+--------------+
8. Principal risks and uncertainties
Each business considers strategic, operational and financial risks and
identifies actions to mitigate those risks on a regular basis and these risk
profiles are communicated to the Group board at least annually. The principal
risks and uncertainties for the six months remain as they were at December 2008
and are fully detailed in the annual report and accounts which are available for
download on the website.
Responsibility Statement
The Directors confirm that these condensed interim financial statements have
been prepared in accordance with IFRS's as adopted by the European Union, with
the exception of the matters noted in the basis of preparation (note 1);
however, they have not been prepared in accordance with IAS 34.
The Directors of Impellam Group plc are as listed in the 2008 annual report and
accounts, with the exception of the resignation of Desmond Doyle on 14 May 2009.
A list of current directors is maintained on the Impellam Group plc website:
www.impellam.com.
By order of the Board,
Cheryl JonesAndrew Burchall
Chairman Group Finance Director
Independent review report to Impellam Group plc
Introduction
We have been engaged by the Company to review the interim financial information
in the interim financial report for the six months ended 30 June 2009, which
comprise the consolidated income statement, condensed statement of comprehensive
income, consolidated condensed balance sheet, consolidated statement of changes
in equity, consolidated cash flow statement and the related notes. We have read
the other information contained in the interim financial report and considered
whether it contains any apparent misstatements or material inconsistencies with
the information in the interim financial information.
Directors' responsibilities
The interim financial report is the responsibility of, and has been approved by,
the directors. The directors are responsible for preparing the interim financial
report in accordance with the AIM Rules for Companies which require that the
financial information must be presented and prepared in a form consistent with
that which will be adopted in the Company's annual financial statements.
The interim financial report has been prepared in accordance with the basis set
out in note 1.
Our responsibility
Our responsibility is to express to the Company a conclusion on the interim
financial information in the interim financial report based on our review. This
report, including the conclusion, has been prepared for and only for the Company
for the purpose of the AIM Rules for Companies and for no other purpose. We do
not, in producing this report, accept or assume responsibility for any other
purpose or to any other person to whom this report is shown or into whose hands
it may come save where expressly agreed by our prior consent in writing.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity' issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Emphasis of matter - basis of preparation adopted for pro forma financial
information
In forming our review conclusion, which is not qualified, we have considered the
adequacy of the disclosures regarding the basis of preparation set out in these
condensed interim financial statements. The Company has presented as comparative
information, pro forma results and cash flows for the enlarged Group assuming,
for the purposes of the income statement and cash flows only, that the
accounting period commenced on1 January 2008 and that the combined Impellam
Group plc, Carlisle Group Ltd and The Corporate Services Group plc was accounted
for using merger accounting as at 1 January 2007. This represents a departure
from the requirements of IAS 1, Presentation of Financial Statements, IAS 27,
Consolidated and Separate Financial Statements, and IFRS 3, Business Combination
which would require presentation of the results of Impellam Group plc from the
date of its incorporation, Carlisle Group Ltd from 1 April 2008 and The
Corporate Services Group plc from the date of acquisition by Impellam Group plc
(7 May 2008) to 30 June 2008. The Directors have disclosed the reasons for this
departure from the requirements of IFRS in the basis of preparation within note
1.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the interim financial information in the interim financial report for the
six months ended 30 June 2009 are not prepared, in all material respects, in
accordance with the basis set out in note 1 and the AIM Rules for Companies.
PricewaterhouseCoopers LLP
Chartered Accountants
7 September 2009
St Albans
Notes:
* The maintenance and integrity of the Impellam Group plc website is the
responsibility of the directors; the work carried out by the auditors does not
involve consideration of these matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the financial
statements since they were initially presented on the website.
* Legislation in the United Kingdom governing the preparation and dissemination of
financial statements may differ from legislation in other jurisdictions.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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