PHSC Phsc Plc

 
TIDMPHSC 
 
8 September 2016 
 
                                   PHSC PLC 
 
                            Pre-AGM Trading Update 
 
PHSC plc ("the Group"), a leading provider of health, safety, hygiene and 
environmental consultancy services and security solutions to the public and 
private sectors, announces an update on its performance ahead of its AGM due to 
be held today. At that meeting the Group Chief Executive, Stephen King, will be 
commenting on the Group's performance for the first four months of the year to 
the end of July 2016. 
 
For this period, the Group's unaudited management accounts are showing a 
consolidated EBITDA loss of around GBP94k on sales of GBP2.3m but the Board 
anticipates that the position will improve before the conclusion of H1 and that 
this improvement will be sustained in the second half of the year, as explained 
below. Cash at bank (as at 6 September 2016) stood at GBP565k which includes net 
proceeds arising from the recent share placing which was announced on 19 August 
2016. 
 
Further commentary on each subsidiary's results for this period is given below. 
Earnings are shown prior to deduction of central management charges and 
taxation. 
 
B to B Links Ltd recorded a loss of around GBP4k and is currently forecast to 
deliver sales of approximately GBP1.2m in H1. Despite large monthly fluctuations 
in client sign-off and installation activity, sales from key national accounts 
have met expectations and continue to deliver much of the company's revenue. 
The closure of the Basingstoke office in July marked the final stage in the 
integration of the Camerascan CCTV acquisition which has gone smoothly in 
operational terms.   There has been an erosion of gross margins due to higher 
trade costs for imported hardware, security tags and labels as a result of the 
weaker pound post the referendum.   The outlook for the second half of the year 
is strong for key national account activity and management is taking a number 
of steps to turn around a sales shortfall in independent retail, one of the 
company's traditional strengths. 
 
SG Systems UK Ltd has lost GBP37k as it continued to suffer from an unexpected 
and lengthy hiatus in new store opening by one of its larger customers, delays 
to a source tagging project, and higher trade costs for imported goods - again 
due to the weakness in sterling.   The issue delaying new store openings has 
very recently been resolved.  Work to introduce new products to new customers 
has begun to bear fruit, and will enable the company to return to monthly 
profits in August and September. This has also provided a healthy pipeline of 
potential projects which it is hoped will be converted during the second half 
of the year. 
 
RSA Environmental Health Ltd generated profit of GBP24k but August is never a 
good month financially as it coincides with closure of schools from which the 
majority of RSA's revenues are drawn.  Activity is expected to pick up as 
schools return in September. 
 
Quality Leisure Management Ltd is showing a profit of just over GBP8k, with Q1 
income down mainly due to Local Authorities coming under greater financial 
pressure. Local Authorities are the main source of funding to Leisure Trust 
clients. 
 
Personnel Health & Safety Consultants Limited expects to deliver around GBP100k 
of profit for the first half, having reached GBP70k by the end of July. The 
subsidiary's largest client has agreed to extend a contract, originally due to 
expire at the end of August, for three months to allow time for negotiations on 
a new arrangement. 
 
Inspection Services (UK) Ltd achieved a profit of GBP15k and expects around GBP20k 
for the first half, ahead of where it was last year. In addition, it recently 
secured its largest single contract, valued at GBP25k, through an insurance 
broker. The contract is an enhanced version of a GBP17k order first awarded last 
year. 
 
QCS International Ltd achieved a profit of GBP40k and anticipates around GBP60k in 
total for the first half. Costs in Q2 were particularly high as the company 
incurred legal expenses associated with preventing a competitor from using a 
similar trading name and style.  Management are confident of a good second half 
performance, with bookings already received for training courses and it is also 
hoped that a new medical device consultancy project will begin in Q3. 
 
Adamson's Laboratory Services Ltd recorded a loss of GBP54k. It continues to face 
considerable difficulties in what has become a highly competitive market for 
asbestos management services.  A number of steps have been taken to reduce 
costs, including staff redundancies, but it will take time for the benefits to 
filter through. The company continues to seek new business and has submitted a 
number of large tenders and quotations for which decisions are awaited. 
 
We look forward to updating the market at the time of our interim results which 
are expected to be announced in early December. 
 
This announcement contains inside information for the purposes of Article 7 of 
EU Regulation 596/2014. 
 
For further information please contact: 
 
PHSC plc                                                       01622 717700 
Stephen King 
Stephen.king@phsc.co.uk 
www.phsc.plc.uk 
 
 
Northland Capital Partners Limited (Nominated Adviser)         0203 861 6625 
Edward Hutton/David Hignell 
 
Beaufort Securities Limited (Broker)                           020 7382 8300 
Elliot Hance 
 
About PHSC 
 
PHSC plc, through its trading subsidiaries Personnel Health & Safety 
Consultants Ltd, RSA Environmental Health Ltd, Adamson's Laboratory Services 
Ltd, QCS International Ltd, Inspection Services (UK) Ltd and Quality Leisure 
Management Ltd, provides a range of health, safety, hygiene, environmental and 
quality systems consultancy and training services to organisations across the 
UK. B to B Links Ltd and SG Systems (UK) Ltd offer innovative retail security 
solutions including tagging, labelling and CCTV. 
 
 
 
END 
 

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