Harvey Nash Group PLC Pre-close Trading Update and Notice of Results (4087Y)

TIDMHVN

RNS Number : 4087Y

Harvey Nash Group PLC

03 March 2017

3 March 2017

HARVEY NASH GROUP PLC

("Harvey Nash" or the "Group")

Pre-close Trading Update and Notice of Results

Harvey Nash, the global executive recruitment and professional services group, issues the following trading update in advance of the Group's final results for the full year ended 31 January 2017 (the "Period"), which will be announced on 27 April 2017.

Trading update

The Board expects to report adjusted pre-tax profit(1) for the year ended 31 January 2017 in line with market expectations. Overall gross profit increased by 8% (-1% on a constant currency basis(2) ). While growth was held back in the UK & Ireland by Brexit uncertainty gross profit was up by 18% in Mainland Europe (4% on a constant currency basis(2) ). The constant currency(2) decline in "Rest of World" was due to challenging market conditions in Hong Kong while in "Offshore Services" it was due to increased costs in Vietnam as a result of the depreciation in the value of sterling during the year.

 
                        Year ended 31 January 
                                 2017 
                   ------------------------------ 
                           Gross profit % 
-----------------  ------------------------------ 
 Geography          Actual   Constant currency(2) 
-----------------  -------  --------------------- 
 
 UK & Ireland           0%                    -3% 
-----------------  -------  --------------------- 
 Mainland Europe      +18%                    +4% 
-----------------  -------  --------------------- 
 Rest of World         +6%                    -7% 
-----------------  -------  --------------------- 
 
 Total                 +8%                    -1% 
-----------------  -------  --------------------- 
 
 
                              Year ended 31 January 
                                       2017 
                         ------------------------------ 
                                 Gross profit % 
-----------------------  ------------------------------ 
 Service line             Actual   Constant currency(2) 
-----------------------  -------  --------------------- 
 
 Permanent recruitment      +10%                     0% 
-----------------------  -------  --------------------- 
 Contracting 
  recruitment                +9%                     0% 
-----------------------  -------  --------------------- 
 Offshore services            0%                   -10% 
-----------------------  -------  --------------------- 
 
 Total                       +8%                    -1% 
-----------------------  -------  --------------------- 
 

Financial position

Net cash of GBP5.5m at the year-end was achieved due to tight control of working capital. The Group has no term debt.

Albert Ellis, Chief Executive Officer, said:

"The Group has delivered a resilient trading performance despite the significant uncertainty created by the referendum. Mainland Europe, which accounts for 40% of total gross profit, continued to make satisfactory progress. Cash flow has materially exceeded expectations with the year ending in a positive net cash position, some GBP5 million higher than 31 January 2016."

Notes

1. Adjusted profit is before a provision of GBP0.5m relating to non-recovery of prior year receivables in the United States.

   2.    Constant currency is calculated by re-translating current year figures at prior year rates. 

ENQUIRIES:

 
 Harvey Nash      Albert Ellis        Tel: [phone] 
                   (CEO)                       2635 
                   Richard Ashcroft 
                   (CFO) 
 
 Hudson Sandler   Fern Duncan         Tel: [phone] 
                   Michael Sandler             4133 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

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March 03, 2017 02:00 ET (07:00 GMT)