Gattaca PLC Trading Update (3905C)

TIDMGATC

RNS Number : 3905C

Gattaca PLC

13 April 2017

13 April 2017

Gattaca plc ("Gattaca", the "Group")

Trading Update

Gattaca plc (LSE-AIM: GATC) today gives the following trading update.

The Board has reviewed its outlook for the remainder of the year to 31 July 2017 and now believes that profits for the year will be approximately 10-15% below its prior expectations.

As previously announced on 2 February 2017, performance in the first half of the year reflects the tougher UK trading conditions post the Brexit vote. The softening in NFI in the first half was driven by near term uncertainty which led to elongated hiring decisions and some projects being delayed; however the medium-term outlook in our sectors remains positive with some signs of a return of confidence in recent weeks.

Unanticipated one time cost overruns relating to the setting up of international entities to support a pan-European contract win and delays in realisation of back office cost savings will result in our central overheads exceeding our expectations for the second half. Alongside this we have been making the appropriate investments to ensure that the Group has the infrastructure to build a truly scalable business. Given the opportunities we see, the Group has continued to strategically invest in sales headcount, up 24 since 31 July 2016 and we expect to see a return on these investments during the second half and beyond. We are particularly confident that the headcount investments which we have made in our overseas businesses will lead to accelerated growth next year.

In line with our vision to become the leading specialist Engineering and Technology recruiter, the acquisition of Resourcing Solutions Limited on 1 February 2017 has significantly strengthened our capability in the UK Rail market, an area of high investment by the government.

With the integration of Networkers now complete, we intend to consolidate our central cost base, whilst maintaining the structure and support we have built and to convert the sales opportunities we see into growth over the next few years.

As previously announced the interim results will be issued on 20 April 2017.

This announcement contains inside information.

- ENDS -

For further information please contact:

 
 Gattaca plc                             [phone] 
 Brian Wilkinson, Chief Executive 
  Officer 
  Tony Dyer, Chief Financial Officer 
 Citigate Dewe Rogerson                 [phone] 
 Rob Newman / Nick Hayns 
 Numis Securities Limited               [phone] 
 Michael Meade / Tom Ballard 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

TSTLLLLFDZFXBBB

(END) Dow Jones Newswires

April 13, 2017 02:00 ET (06:00 GMT)