CPL Resources PLC Half Yearly Report (8442C)
January 25 2018 - 2:00AM
UK Regulatory
TIDMCPS
RNS Number : 8442C
CPL Resources PLC
25 January 2018
Cpl Resources Plc
Results for the six months ended 31 December 2017
CPL delivers double-digit growth in revenue, gross profit and
earnings and
returns EUR25m to shareholders in the first half of financial
year 2018
Cpl Resources Plc ("Cpl" or the "Group"), Ireland's leading
employment services group, today announced results for the half
year ended 31 December 2017.
Chairman's Statement
I am pleased to report that in the six months to 31 December
2017 the Group delivered continued growth in revenues, net fee
income and profits.
Half year highlights
-- 12% increase in revenues to EUR256.7 million
-- 12% increase in gross profit (net fee income) to EUR40.5 million
-- Profit before tax of EUR9.0 million, an 11% increase
-- Earnings per share increased 15% to 26.4 cent
-- 10% increase in interim dividend to 6.35 cent per share
Half year highlights Half year Half year % change
ended ended
EUR000s except where 31-Dec-17 31-Dec-16
indicated
---------------------------- ---------- ---------- ---------
Revenue 256,714 228,717 12%
Gross Profit 40,502 36,188 12%
Adjusted Operating profit* 9,343 8,971 4%
Adjusted Profit before
tax* 9,666 8,979 8%
Operating profit 8,684 8,088 7%
Profit before tax 9,007 8,096 11%
Earnings per share 26.4 cent 23.0 cent 15%
Dividend per share 6.35 cent 5.75 cent 10%
---------------------------- ---------- ---------- ---------
Conversion ratio **
Adjusted Operating Profit 23.1% 24.8%
Adjusted Profit before
tax 23.9% 24.8%
Operating Profit 21.4% 22.3%
Profit before tax 22.2% 22.4%
---------------------------- ---------- ---------- ---------
Net fee income - permanent
placements 13,037 13,279 (2%)
Net fee income - temporary
and contract 27,465 22,909 20%
---------------------------- ---------- ---------- ---------
Permanent net fee income
as a %
of total gross profit 32% 37%
Temporary and contract
net fee income as a %
of total gross profit 68% 63%
---------------------------- ---------- ---------- ---------
* Adjusted operating profit and adjusted profit before tax
exclude non-cash charges relating to the Group's Long-Term
Incentive Plan (LTIP) and currency translation
** As a % of gross profit
Revenues for the six months to 31 December 2017, which includes
a full six months' trading contribution by RIG Healthcare Group
("RIG"), our recent UK acquisition, increased by 12% to EUR256.7
million. Our gross profit increased by 12% against the same period
last year to EUR40.5 million. The Group's profit before tax was
EUR9.0 million for the six months to 31 December 2017, an 11%
increase on the same period last year. Our conversion rate of gross
profit to operating profit (excluding non-cash foreign currency
translations and LTIP charges) was 23.1% in the period.
The non-cash LTIP charge was EUR0.5 million in the six months to
31 December 2017 (2016: EUR0.4 million). The LTIP charge for the
six months to 31 December 2017 reflects current expectations in
relation to the achievement of performance targets included in the
LTIP awards.
The Group delivered a 15% increase in earnings per share to 26.4
cent for the six months to 31 December 2017, positively impacted by
the Tender Offer which completed during the period.
The Group continues to work with clients to understand their
specific requirements and with our candidates in order to match
their skills to those client requirements. The proportion of our
net fee income that is made up of temporary fees has increased from
63% in the same period last year to 68%, driven primarily by RIG's
revenue mix but also by organic growth across our sectors. This
shift in our business model is reflective of a global move toward
the "gig economy" and greater flexibility for client and candidate
alike. We also improved the margin on our temporary business to
11.3% (2016: 10.6%).
We have invested significantly in our technology platform over
the past few years and are delighted to be pioneering one of the
first artificial intelligence tools in the recruitment sector. Cpl
is committed to staying at the forefront of AI and machine learning
technology in order to make the recruitment process faster and more
efficient for the benefit of our candidates and clients.
We continue to grow and develop our people within the Group and
on behalf of the Board I wish to express my gratitude for the
continuing hard work and dedication of all of our people and for
their commitment to the Group.
Tender Offer
During the six months ended 31 December 2017, the Group returned
EUR25 million of surplus cash to its shareholders by way of a fixed
price tender offer (the "Tender Offer"), considering this to be the
most effective use of those shareholder funds. The Tender Offer was
fully subscribed and successfully executed, with the Company
repurchasing and cancelling 3,703,703 shares at a price of EUR6.75
per share, thereby reducing the issued share capital by
approximately 12%.
Cash
The continued strength of our Balance Sheet reflects the
positive cash-generating capability of Cpl. The Group has a net
cash balance of EUR12.4 million as at 31 December 2017 (2016:
EUR35.2 million). In the six months to 31 December 2017, EUR9.8
million was generated in cash flow from operating activities before
tax and changes in working capital. Although our business requires
significant investment in working capital, excluding the impact of
the Tender Offer (EUR25.2 million) we recorded a net cash inflow of
EUR3.9 million in the period (2016: EUR2.2 million). Together with
available financing facilities, the Group remains adequately funded
to pursue its stated growth objectives.
Dividend
The Board proposes to pay an interim dividend of 6.35 cent per
share, an increase of 10% on last year's interim dividend,
reflecting the Group's strong performance in the period. The
interim dividend will be payable on 2 March 2018 to shareholders on
the register at the close of business on the record date of 2
February 2018.
Outlook
As we move into the second half of our financial year we are
closely monitoring activity levels in all of our markets. We remain
conscious of the impact of political, regulatory and economic
events globally on our business. Positive momentum in the Irish and
Eurozone labour markets should position the Group well for further
growth across its key business sectors.
We remain confident in the outlook for the business and expect
to deliver continued profitable growth for the remainder of the
financial year.
John Hennessy
Chairman
25 January 2018
Financial Statements
The financial statements for the six month period ending 31
December 2017 can be accessed below:
http://www.rns-pdf.londonstockexchange.com/rns/8442C_-2018-1-24.pdf
For Further Information:
Cpl Resources plc +353 1 614 6000
Anne Heraty (CEO)
Mark Buckley (Deputy CEO
& COO)
Lorna Conn (CFO)
Davy Corporate Finance (NOMAD,
ESM Adviser) +353 1 679 6363
Ivan Murphy
Daragh O'Reilly
This information is provided by RNS
The company news service from the London Stock Exchange
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