World Careers Network PLC Final Results (4040V)

TIDMWOR

RNS Number : 4040V

World Careers Network PLC

02 November 2017

2 November 2017

PRELIMINARY ANNOUNCEMENT OF THE AUDITED RESULTS OF

WORLD CAREERS NETWORK PLC

WORLD CAREERS NETWORK PLC

Chairman's Statement

I am pleased to present the annual accounts of World Careers Network plc ("WCN" or the "Company"), which show the results of the Company for the year to 31 July 2017.

Financial review

As anticipated in my full year statement for 2016, profits for 2017 are significantly down at GBP811,543 compared to last year's profit of GBP1,382,896 while revenues increased 16.4% from GBP8,457,202 to GBP9,848,048.

The changes in Key Performance Indicators between the financial years 2016/2017 and 2015/2016 were as follows:

 
                                  2016/17   2015/16 
                                      GBP       GBP 
 
 Sales per employee                86,513    86,298 
 Operating profit per employee      6,783    13,670 
 

The average headcount in 2016/17 was up 16% at 114.

The group is investing for future growth and this has resulted in increased headcount and employee costs. Revenues have risen broadly in line with our headcount whilst the operating profit per employee has fallen as a result of the concentration of resources into specialist areas and an increase in our marketing spend.

The Board will be seeking at the Annual General Meeting the extension of the authority granted last year to make market purchases of ordinary shares, within the usual limits for a listed company. In assessing whether in practice to use this authority, the Board will take into account all relevant factors including the effect on earnings per share and assets per share ratios and other benefits to shareholders.

Dividends

The directors are pleased to recommend the payment of a dividend of 3.5p per share, which is the same as that paid in respect of the previous year. This dividend will be subject to the approval of shareholders at the Annual General Meeting to be held at 5-7 Bridgeworks, The Crescent, London SW19 8DR at 10.30 am, on 13 December 2017, and, if approved, will be payable on 15 December 2017 to shareholders on the register as at 24 November 2017.

Operating review

There is a considerable focus inside the business on ensuring existing clients are highly satisfied, retained and growing their business with us; that we are developing innovative transformational product which by supporting the recruitment of high quality and diverse hires delivers a significant benefit to our clients; that we broaden the market for our products and attract new clients; and ensuring we have a great team in WCN to deliver against our objectives.

Investment in these areas - primarily marketing, sales, product development and customer success & support - resulted in a rise in our costs of GBP1,958,410.

The benefit of this expenditure is reflected in an improvement in our client satisfaction and the increase in our sales of GBP1,390,846.

Principal risks and uncertainties

Commercial and operational risk

Competitive pressure and economic instability is a continuing if not growing risk for the Company. The Company manages this risk by developing leading edge products capable of driving significant transformation and value within our clients, through high levels of customer service, by managing resource levels and pursuing opportunities for continuous improvement.

The business is dependent upon clients' ability to safely access data held on our servers. In order to ensure that this is not affected by a breakdown in power supplies or by other physical hazards our servers are housed offsite in secure facilities on the premises of a specialist provider of such facilities. Third party security experts are also regularly engaged to advise on data security.

Financial risk

The main risk arising from the Company's activities is currency risk. This is monitored by the Board of directors and was not considered to be significant at the balance sheet date.

Outlook

Strong technology and an exciting product pipeline; positive and growing client satisfaction; and an experienced team provide a great foundation for ongoing success. However, lower than expected sales in the last financial year and ongoing sales challenges, high investments, known reductions in revenues from the existing client base, general economic uncertainty and a competitive market will make this a very challenging year in which, inevitably, we expect to see a further significant fall in profits.

The high quality of the team and dedication to our clients is the key factor underlying our success. I'd like to thank the team at WCN for their outstanding efforts.

Charles EH Hipps

Chairman, World Careers Network Plc

Date 2 November 2017

consolidated income statement

For the Year Ended 31 July 2017

 
                                        2017        2016 
                                         GBP         GBP 
 
 Revenue                           9,848,048   8,457,202 
 
 Total administrative expenses     9,075,921   7,117,511 
                                   _________   _________ 
 
 Operating profit                    772,127   1,339,691 
 
 Finance income                       39,416      43,205 
                                   _________   _________ 
 
 Profit on ordinary activities 
  before taxation                    811,543   1,382,896 
 
 Income tax                          194,856     277,201 
                                   _________   _________ 
 
 Profit for the year                 616,687   1,105,695 
                                   _________   _________ 
 
 Earnings per share 
 
 Basic                                 8.15p      14.62p 
                                   _________   _________ 
 
 Diluted                               8.05p      14.46p 
                                   _________   _________ 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Consolidated Statement of Financial Position

As at 31 July 2017

 
                                         2017         2016 
                                          GBP          GBP 
 Assets 
 Non-current assets 
 Property, plant and equipment        170,848      140,174 
                                    _________    _________ 
 
                                      170,848      140,174 
 Current assets 
 Trade and other receivables        1,454,107    2,299,183 
 Cash and cash equivalents         11,631,288   10,171,966 
                                    _________    _________ 
 
 Total current assets              13,085,395   12,471,149 
                                    _________    _________ 
 
 Total assets                      13,256,243   12,611,323 
                                    _________    _________ 
 
 Equity 
 Issued capital                         7,586        7,562 
 Share premium                      1,649,024    1,595,040 
 Capital redemption reserve               708          689 
 Translation reserve                  (1,188)        5,595 
 Retained earnings                  8,273,990    7,945,446 
                                    _________    _________ 
 
 Total equity                       9,930,120    9,554,332 
                                    _________    _________ 
 Liabilities 
 Non-current liabilities 
 Deferred tax                          21,822       16,643 
                                    _________    _________ 
 Liabilities 
 Current liabilities 
 Trade and other payables           3,183,567    2,867,245 
 Corporation tax                      120,734      173,103 
                                    _________    _________ 
 
 Total current liabilities          3,304,301    3,040,348 
                                    _________    _________ 
 
 Total liabilities                  3,326,123    3,056,991 
                                    _________    _________ 
 
 Total equity and liabilities      13,256,243   12,611,323 
                                    _________    _________ 
 

Consolidated statement of cash flows

For the Year Ended 31 July 2017

 
                                                  2017         2016 
                                                   GBP          GBP 
 Cash flows from operating activities 
 Profit for the year                           616,687    1,105,695 
 Depreciation                                   94,104       84,067 
 Exchange differences on translation 
  of foreign operations                        (6,783)      (4,371) 
 Share based payments                           13,652       16,202 
 Decrease in receivables                       845,076      268,495 
 Increase in payables                          316,322      824,648 
 Finance income                               (39,416)     (43,205) 
 Corporation tax expense                       194,856      277,201 
                                             _________    _________ 
 
                                             2,034,498    2,528,732 
 Taxation                                    (242,047)    (250,556) 
                                             _________    _________ 
 
 Net cash inflow from operating 
  activities                                 1,792,451    2,278,176 
                                             _________    _________ 
 
 Cash flows from investing activities 
 Interest received                              39,416       43,205 
 Purchase of property, plant and 
  equipment                                  (124,778)    (107,498) 
                                             _________    _________ 
 
 Net cash outflow from investing 
  activities                                  (85,362)     (64,293) 
                                             _________    _________ 
 
 Cash flows from financing activities 
 Proceeds from issue of shares                  54,027        3,340 
 Purchase of own shares                       (37,050)            - 
 Equity dividends paid                       (264,745)    (264,645) 
                                             _________    _________ 
 
 Net cash outflow from financing 

  activities                                 (247,768)    (261,305) 
                                             _________    _________ 
 
 Increase in cash in the year                1,459,321    1,952,578 
 
 Cash and cash equivalents at beginning 
  of year                                   10,171,966    8,219,388 
                                             _________    _________ 
 
 Cash and cash equivalents at end 
  of year                                   11,631,287   10,171,966 
                                             _________    _________ 
 
 

Notes

1. The profit and loss account incorporates the consolidated results of World Careers Network PLC and its subsidiary for the year ended 31 July 2017. The accounting policies used in the preparation of these audited results are unchanged from those adopted by the company in previously published annual financial statements.

   2.       Earnings per share 

Basic earnings per share

This is calculated by dividing the profit of GBP616,687 (2016 - GBP1,105,695), being the profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue throughout the year of 7,568,480 (2016 - 7,561,263)

Diluted earnings per share

The weighted average number of shares for 2017 for this calculation was 7,662,261 (2016 - 7,645,920). This is calculated based on the weighted average number of ordinary shares adjusted by 93,781 (2016 - 84,657) to recognise the effect of the potential issue of further ordinary shares as a result of the exercise of share options

   3.       The directors are recommending the payment of a dividend of 3.5p per share. 

4. The preliminary announcement was approved by the board on 2 November 2017. The Company's annual accounts will be sent to shareholders on 17 November 2017 and copies will be available from the company's office at 5-7 Bridgeworks, The Crescent, London SW19 8DR and on the Company's website at www.wcn.co.uk.

5. The financial information does not constitute the company's statutory accounts, within the meaning of Section 435 of the Companies Act 2006, for the years ended 31 July 2017 or 2016 but is derived from those accounts. Statutory accounts for 2016 have been delivered to the Registrar of Companies and those for 2017 will be delivered following the company's forthcoming annual general meeting. The auditors have reported on those accounts; their reports were unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports and did not contain statements under the Companies Act 2006, s498(2) or (3).

Enquiries

World Careers Network Plc

Charles Hipps, Managing Director,

Telephone: [phone]

Email:[e-mail].

Panmure Gordon (UK) Limited

Nominated Adviser

Andrew Potts

Telephone: [phone]

This information is provided by RNS

The company news service from the London Stock Exchange

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November 02, 2017 07:09 ET (11:09 GMT)