PHSC Phsc Plc

 
TIDMPHSC 
 
16 June 2016 
 
                                   PHSC PLC 
 
                                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 for the financial year 
ended 31 March 2016. 
 
These indicative figures are per management accounts and after certain 
adjustments, and are currently in the final stages of audit. We expect to issue 
our Final Results announcement in early August 2016. 
 
Consolidated Group revenue for the period was around GBP 7.04m, representing a 
fall of 9% year-on year (2015 - GBP 7.7m).  The reduction arises principally 
from the ending of a large asbestos management contract previously delivered by 
Adamson's Laboratory Services Limited (ALS) with a leading university, as 
mentioned in our interim results statement. ALS was unable to find sufficient 
replacement work to bridge the gap during the second half. 
 
It is encouraging that Consolidated Group revenue in the second half increased 
around 12% over the first half but, as explained below, it is likely that due 
principally to an impairment in the carrying value of goodwill the results for 
the full year will not meet our expectation at the time of the interim results 
statement that we would see a stronger second half to the year. 
 
Underlying EBITDA (excluding the goodwill impairment charge below) stands at 
GBP 0.418m (2015: GBP 0.818m) prior to various costs associated with the two 
acquisitions made in December 2015.  Legal and other costs totalled 
approximately GBP 50,000. In addition, a further GBP 50,000 has been expended 
in meeting the initial integration costs of one of those acquisitions, SG 
Systems (UK) Limited, in the period to 31 March 2016. Should these costs not be 
recovered over the earn-out period, they are deductible from the final 
instalment due under the share purchase agreement. 
 
Given the difficult trading conditions experienced by ALS, and in accordance 
with standard tests applied by our Auditors, we anticipate an impairment of GBP 
0.6m in the carrying value of goodwill in respect of ALS, representing a 
reduction of approximately 9% in the consolidated net assets of the Group 
before this adjustment. 
 
The Company has adopted a progressive dividend policy. The directors believe 
that the Company's distributable reserves are more than adequate to support the 
payment of a dividend in line with previous years, should such a resolution be 
supported at the AGM. 
 
Management accounts indicate that both Group revenues and EBITDA in the early 
part of 2016-17 are running ahead of the comparative figures for last year. 
 
Cash flow remains positive and the average bank balance in June 2016 has been 
circa GBP 0.25m. The Company also has a facility with its bankers, currently 
not called upon, of GBP 0.2m. 
 
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 
 

(END) Dow Jones Newswires

June 16, 2016 02:00 ET (06:00 GMT)

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