Sunday, September 19, 2021

Trading “strong” in first six months of 2021 at Staffline

Revenue and profit are up at Staffline, the recruitment and training group, according to a trading update for the six months ended 30 June 2021.

During the period, revenue grew 4.7% to £450.7m from £430.3m in H1 2020.

Gross profit, meanwhile, rose to £39m from £34.2m – up 14%.

At the Nottingham-based company’s Annual General Meeting, Ian Lawson, non-executive chairman of Staffline, will make the following statement: “Trading has continued to be strong across the first six months of the year to 30 June 2021 and is ahead of expectations with all three of Staffline’s core divisions delivering a solid performance in the first half.

“This, coupled with the benefits of the Group’s cost reduction measures implemented in 2020, in addition to securing new higher margin business, continues to underpin Underlying operating profit growth.

“Revenue for H1 2021 is expected to be £450.7 million (H1 2020: £430.3 million), up 4.7% with Gross Profit expected to be £39.0 million (H1 2020: £34.2 million), up 14%, a significant improvement year-on-year and a positive trend in the gross margin.

“The Group is expected to report a net cash position of £20.9m at 30 June 2021 (30 June 2020: net debt £(36.2) million). This is principally due to the net proceeds of the equity raise of £44.4m in June 2021, VAT payment relief of £40.7m still to be repaid, c. £15m of timing benefits which are expected to unwind and further improvements in trading cash flow and cash collection efficiency, which have generated an additional c.£10m.

“The equity and debt refinancing have transformed the Company’s balance sheet and repositioned the Group for the medium term.

“Recruitment GB performed strongly throughout the first half across food, logistics and e-commerce, with additional margin gains arising from new business wins in online food distribution and the effect of exiting legacy lower margin contracts. This was achieved despite challenges in the specialist driving division due to the widely reported acute labour shortages.

“Recruitment Ireland has delivered a strong six months, buoyed by good trading in its core Northern Ireland business alongside tight cost control and continued growth in the Republic of Ireland.

“Finally, the Group’s PeoplePlus division also reported an excellent performance from its core ‘employability’ division, ensuring the business generated an Underlying operating  profit for the first six months of the year compared to a loss in the comparable period in 2020.

“Overall, the Board and management team are pleased with both the operational and financial performance for the six months to 30 June 2021. Whilst there remains economic uncertainty as we enter H2 2021 and ongoing headwinds relating to the pandemic, the Group has and will benefit from the loosening of lockdown restrictions across the UK and Ireland.

“The Board remains confident in Staffline’s robust operating model, and, coupled with the strengthening of its financial position in the first half of 2021, the Group remains well placed in the medium term.”

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