Interim Results

RNS Number:9965O
Imprint Search and Selection PLC
26 August 2003


For Immediate Release                                            26 August 2003



                          IMPRINT SEARCH & SELECTION PLC


                                 INTERIM REPORT

                     for the six months ended 30 June 2003


Imprint Search & Selection plc is pleased to announce its results for the six
months ended 30 June 2003.


HIGHLIGHTS


* First reporting period of profitable and cash generative trading


* Continued development of quality client base


* Further strengthening of the management team


* Consolidation of Asian business to Hong Kong


* Strong pipeline of future business


* Highly scaleable operational platform established


Pierce Casey, Chairman, Imprint Search & Selection plc, commented:


"I am delighted to be reporting our first period of profitable trading. Imprint
has again demonstrated that it can grow market share in difficult trading
conditions. Moreover, the pipeline of future opportunities continues to
strengthen giving us confidence of increased profitability in the second half of
2003. In light of this, we are currently building our operational framework to
fully exploit the group's potential."


For further information, please contact


Imprint Search & Selection plc                           020 7287 8585

Brian Hamill, Chief Executive Officer

John Hunter, Chief Financial Officer

Buchanan Communications                                  020 7466 5000
Tim Anderson / Isabel Petre


CHAIRMAN'S STATEMENT


INTRODUCTION


I am delighted to report that Imprint has completed its first reporting period
of profitable and cash generative trading. Imprint has again increased its
market share through a combination of winning new clients, further developing
existing clients and broadening its sector offerings.


Results


The trading results for the period are summarised as follows:

                                                6 months ended   6 months ended
                                                 30 June 2003     30 June 2002
                                                         #000             #000

Turnover                                                2,139            1,934
Operating costs                                        (1,987)          (2,590)
                                                    -----------       ----------

Operating profit/(loss)                                   152             (656)
Interest income                                            18               45
                                                    -----------       ----------

Profit/(loss) for the period before taxation              170             (611)
                                                    ===========       ==========

Profit/(loss) per share                                   1.0p            (3.5)p



Our balance sheet remains strong with net assets totalling #2.3 million,
including cash of #1.2 million.


BUSINESS REVIEW


Imprint has continued to make excellent progress in executing its strategy of
establishing a branded multi-disciplined international search and selection
business. In addition to achieving the core objective of sustained
profitability, your board is very encouraged by both the continued development
of our client base and the quality of new personnel hired in the period.


We continue to focus client development around our strategy of servicing, across
multiple functions, a relatively small number of blue chip clients. During the
six months ended 30 June 2003, over 80% of group revenue was derived from
recurring clients.


During the period, we have also focussed on enhancing the profile of the company
within our sector so that we can attract the best talent available. This has
resulted in a number of significant appointments, most notably David Moffat, who
joins us to oversee group operations. David has extensive experience of running
multi-national recruitment businesses in the UK, Asia and Australasia, most
recently as managing director of Wall Street in Hong Kong. David's initial remit
is to further develop our operational policies, procedures and practices so as
to ensure that our business model is truly scaleable.


UK

Imprint's UK business has benefited both from the cost cutting implemented
during the second half of 2002 and from strong growth in revenue per fee earner.
This has been most marked in the commerce and industry divisions, which have
made some significant blue chip client wins. The deterioration in the financial
services market that we reported in our 2002 Annual Report continued through the
first quarter of 2003, however, we have continued to maintain a broad range of
recruitment offerings in this sector and our financial services divisions have
benefited from a small increase in activity levels during the second quarter.
All of the UK's operating divisions have, therefore, contributed to the group's
improved trading performance. Turnover totalled #2.075 million (2002 - #1.776
million) and operating profit amounted to #271,000 (2002 - operating loss
#468,000).


Asia

In our 2002 Annual Report we reported deteriorating trading conditions in Asia
due to difficult market conditions in Hong Kong and increased price sensitivity
in Shanghai. Unfortunately, these conditions have been further exacerbated by
SARS, which severely restricted trading activity in February, March, and April.
We have responded to this by consolidating our operations to Hong Kong. We plan
to leverage the Hong Kong business when trading conditions improve. Although
turnover for the period totalled #64,000 (2002 - #158,000) and operating losses
amounted to #119,000 (2002 - #189,000), the business has been self-funding since
the closure of the Shanghai office at the end of April.


STRATEGY


Our strategy to date has been to ensure that our brands are represented in all
of our target markets so as to facilitate the rapid expansion of the business
when trading conditions improve. Your board believes that Imprint's recruitment
offerings are now sufficiently developed to justify the expansion of the
business during the second half of 2003.


We remain mindful of the acquisition opportunities that tend to follow a
cyclical downturn and recognise that, in light of our stable organic
foundations, our wish to grow the group rapidly may be best served through
acquisition. However, our acquisition strategy will continue to be cautious.


CURRENT TRADING & PROSPECTS


Trading has continued to improve since 30 June. The pipeline of future
opportunities continues to strengthen giving us confidence of increased
profitability in the second half of 2003. In light of this, we are currently
building our operational framework to fully exploit the group's potential.





Pierce Casey, Chairman

26 August 2003


CONSOLIDATED PROFIT AND LOSS ACCOUNT

For the 6 months ended 30 June 2003

                                  6 months ended   6 months ended   Year ended
                                   30 June 2003     30 June 2002     31 December
                                                                          2002
                                    (unaudited)      (unaudited)
                         Notes                #                #             #

Turnover                     2        2,138,789        1,934,055     3,479,968

Cost of sales                        (1,115,036)      (1,753,781)   (3,015,567)
                                       ----------       ----------    ----------

Gross profit                          1,023,753          180,274       464,401

Administrative                         (872,249)        (836,410)   (1,730,787)
expenses                               ----------       ----------    ----------

Operating profit/(loss)      2          151,504         (656,136)   (1,266,386)

Interest receivable                      18,169           44,959        65,741
                                       ----------       ----------    ----------

Profit/(loss) on             2          169,673         (611,177)   (1,200,645)
ordinary activities
before taxation

Tax on loss on ordinary                       -           (2,305)      (13,565)
activities                             ----------       ----------    ----------

Profit/(loss) retained                  169,673         (613,482)   (1,214,210)
for the period                         ==========       ==========    ==========

Basic profit/(loss) per      6              1.0p            (3.5)p        (7.0)p
ordinary share

Diluted profit/(loss)        6              0.8p            (3.5)p        (7.0)p
per ordinary share


There are no recognised gains or losses other than the profit for the period and
therefore no separate statement of total recognised gains and losses has been
presented.



CONSOLIDATED BALANCE SHEET

As at 30 June 2003



                                      As at          As at               As at
                                      30 June 2003   30 June 2002    31 December
                                                                          2002
                                       (unaudited)    (unaudited)
                                                 #              #            #

Fixed assets
Tangible assets                            240,997        365,371      307,711
                                          ----------      ---------  -----------

Current assets
Trade and other debtors                    998,249      1,130,970      859,744
Rent deposit                               582,544        582,544      582,544
Cash and short term deposits             1,200,447      1,358,193    1,047,131
                                          ----------      ---------  -----------

                                         2,781,240      3,071,707    2,489,419

Creditors
Amounts falling due within one year       (686,866)      (679,765)    (640,545)

Net current assets                       2,094,374      2,391,942    1,848,874
                                          ----------      ---------  -----------

Total net assets                         2,335,371      2,757,313    2,156,585
                                          ==========      =========  ===========

Capital and reserves

Called up share capital                    173,467        173,467      173,467
Share premium account                    5,219,892      5,219,892    5,219,892
Profit and loss account                 (3,057,988)    (2,636,046)  (3,236,774)
                                          ----------      ---------  -----------

Equity shareholder's funds               2,335,371      2,757,313    2,156,585
                                          ==========      =========  ===========



CONSOLIDATED CASH FLOW STATEMENT

For the 6 months ended 30 June 2003



                                  6 months ended   6 months ended   Year ended
                                   30 June 2003     30 June 2002     31 December
                                                                          2002
                                    (unaudited)      (unaudited)
                                              #                #             #
Net cash inflow/(outflow) from
operating
activities                              135,746       (2,161,390)   (2,476,443)
                                       ----------       ----------    ----------

Returns on investment and
servicing of financing
Interest received                        18,169           44,959        65,741

Taxation
Corporation tax paid                          -           (2,305)      (17,553)

Capital expenditure
Payments to acquire tangible               (452)         (45,071)      (46,614)
fixed assets                           ----------       ----------    ----------

Net cash inflow/(outflow) before
management of
liquid resources/financing              153,463       (2,163,807)   (2,474,869)
                                       ----------       ----------    ----------

Management of liquid resources
(Increase)/decrease in short           (150,662)       2,372,525     2,493,532
term deposits                          ----------       ----------    ----------

Increase in cash                          2,801          208,718        18,663
                                       ==========       ==========    ==========



Reconciliation of Net Cash Flow to Movement in Net Funds

                                  6 months ended   6 months ended   Year ended
                                   30 June 2003     30 June 2002     31 December
                                                                          2002
                                    (unaudited)      (unaudited)

                                              #                #             #

Increase in cash                          2,801          208,718        18,663
Increase/(decrease) in short            150,662       (2,372,525)   (2,493,532)
term deposits                          ----------       ----------    ----------

Change in net funds resulting           153,463       (2,163,807)   (2,474,869)
from cash flows
Exchange differences                       (147)               -             -
                                       ----------       ----------    ----------

Movement in net funds in the            153,316       (2,163,807)   (2,474,869)
period

Opening net funds                     1,047,131        3,522,000     3,522,000
                                       ----------       ----------    ----------

Closing net funds                     1,200,447        1,358,193     1,047,131
                                       ==========       ==========    ==========


NOTES TO INTERIM REPORT

For six months ended 30 June 2003


1                accounting policies


Accounting convention


The accounts are prepared under the historical cost convention, and in
accordance with applicable accounting standards. The above financial information
does not constitute statutory accounts as defined in section 240 of the
Companies Act 1985. The financial information for the year ended 31 December
2002 is based on the statutory accounts for the year ended 31 December 2002.
Those accounts, upon which the auditors issued an unqualified opinion, have been
delivered to the Registrar of Companies.


Basis of preparation


The interim financial information has been prepared on the basis of the
accounting policies set out in the Group's 2002 statutory accounts. Fixed annual
charges are apportioned to the interim period on the basis of time elapsed.
Other expenses are accrued in accordance with the same principles used in the
preparation of the annual accounts.

Basis of consolidation


These statements consolidate the accounts of Imprint Search and Selection Plc
and its subsidiary undertakings, Imprint Consulting Limited and Imprint Search
and Selection Limited, drawn up to 30 June 2003.


Depreciation


Depreciation is provided on all tangible fixed assets at rates calculated to
write off the cost or valuation, less estimated residual value, of each asset
evenly over its expected useful life, as follows:

Furniture, fixtures and fittings, and office equipment   - 25% per annum
Computer equipment                                       - 25% - 50% per annum


The carrying values of tangible fixed assets are reviewed for impairment
periodically for events or changes in circumstances that indicate that the
carrying value may not be recoverable.


Turnover


Turnover is recognised at the date an offer is accepted by a candidate and a
start date is determined. Turnover not invoiced at the balance sheet date is
included within accrued income.


Leasing


Rentals paid under operating leases are charged to income on a straight-line
basis over the lease term.


Pensions


The group has a stakeholder pension scheme available for employees and also
makes defined contributions directly to the employees' personal pension plans.
Contributions are charged to the profit and loss account as they become payable.


Deferred taxation


Deferred taxation is recognised in respect of all timing differences that have
originated, but not reversed at the balance sheet date in respect of
transactions or events that have occurred at that date that will result in an
obligation to pay more, or right to pay less, tax, with the following
exceptions:


* provision is made for deferred tax that would arise on remittance of
the retained earnings of subsidiaries only to the extent that, at the balance
sheet date, dividends have been accrued as receivable; and

* deferred tax assets are recognised only to the extent that the
directors consider that it is more likely than not that there will be suitable
taxable profits from which the future reversal of the underlying timing
differences can be deducted.


Deferred tax is measured on an undiscounted basis at the tax rates that are
expected to apply in the years in which timing differences reverse, based on tax
rates and laws enacted or substantively enacted at the balance sheet date.


Foreign currencies


The financial statements of overseas subsidiary undertakings are translated at
the rate of exchange ruling at the balance sheet date. The exchange difference
arising on the retranslation of opening net assets is taken directly to
reserves. All other exchange differences are taken to the profit and loss
account.


2.                    SEGMENTAL ANALYSIS


The group's turnover and profit during the period arose as follows:

                                  6 months ended   6 months ended   Year ended
                                   30 June 2003     30 June 2002     31 December
                                                                          2002
                                    (unaudited)      (unaudited)

                                              #                #             #

TURNOVER

United Kingdom & Europe               2,075,104        1,775,803     3,196,949
Asia Pacific                             63,685          158,252       283,019
                                      -----------      -----------   -----------

                                      2,138,789        1,934,055     3,479,968
                                      -----------      -----------   -----------

OPERATING PROFIT/(LOSS)
United Kingdom & Europe                 270,512         (467,573)     (904,100)
Asia Pacific                           (119,008)        (188,563)     (362,286)
                                      -----------      -----------   -----------

                                        151,504         (656,136)   (1,266,386)

Interest receivable                      18,169           44,959        65,741
                                      -----------      -----------   -----------

Profit/(loss) on ordinary               169,673         (611,177)   (1,200,645)
activities before taxation            -----------      -----------   -----------

NET ASSETS/(LIABILITIES)
United Kingdom & Europe               2,427,001        2,945,876     2,532,497
Asia Pacific                            (91,630)        (188,563)     (375,912)
                                      -----------      -----------   -----------

                                      2,335,371        2,757,313     2,156,585
                                      ===========      ===========   ===========


3.              RECONCILIATION OF OPERATING PROFIT/(LOSS) TO NET CASH INFLOW/
                (OUTFLOW) FROM OPERATING ACTIVITIES:



                                  6 months ended   6 months ended   Year ended
                                   30 June 2003     30 June 2002     31 December
                                                                          2002
                                    (unaudited)      (unaudited)
                                              #                #             #

Operating profit/(loss)                 151,504         (656,136)   (1,266,386)
Depreciation charge                      66,888           70,384       129,587
Increase in debtors                    (140,544)        (901,826)     (628,234)
Rent deposit paid                             -         (582,544)     (582,544)
Increase/(decrease) in                   57,898          (91,268)     (128,866)
creditors                              ----------       ----------   -----------

Net cash inflow/(outflow) from
operating
activities                              135,746       (2,161,390)   (2,476,443)
                                       ==========       ==========   ===========


4.              INTERIM STATEMENT


This statement will be sent to all shareholders and copies are available from
the registered office: 2 Sheraton Street, London, W1F 8BH.


5.              DIVIDEND


The directors do not propose the payment of a dividend for the period.


6.              EARNINGS PER SHARE


Basic earnings per share for each period are calculated by dividing the profit
or loss retained for each period by the number of shares in issue, 17,346,730.


The diluted profit per share for the six months ended 30 June 2003 is calculated
by dividing the retained profit for the period by the weighted average number of
shares in issue, 20,251,730. The difference between the number of shares in the
basic and weighted average number of shares in the diluted earnings per share
calculations represents those ordinary shares deemed to have been issued for no
consideration on the conversation of all potential dilutive ordinary shares in
accordance with FRS 14 "Earnings per Share".


The diluted loss per share for the period ended 30 June 2002 and the year ended
31 December 2002 is equal to the basic loss per share as the group was loss
making.



INDEPENDENT REVIEW REPORT TO IMPRINT SEARCH AND SELECTION PLC


Introduction


We have been instructed by the company to review the financial information for
the six months ended 30 June 2003 which comprises the Consolidated Profit and
Loss Account, the Consolidated Balance Sheet, the Consolidated Cash Flow
Statement and the related notes 1 to 6. We have read the other information
contained in the interim report and considered whether it contains any apparent
misstatements or material inconsistencies with the financial information.

This report is made solely to the company having regard to guidance contained in
Bulletin 1999/4 'Review of interim financial information' issued by the Auditing
Practices Board. To the fullest extent permitted by the law, we do not accept or
assume responsibility to anyone other than the company, for our work, for this
report, or for the conclusions we have formed.


Directors' responsibilities


The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report as required by the AIM Rules
issued by the London Stock Exchange.


Review work performed


We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with United Kingdom Auditing Standards and therefore
provides a lower level of assurance than an audit. Accordingly we do not express
an audit opinion on the financial information.


Review conclusion


On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30 June 2003.


Ernst & Young LLP

London

26 August 2003







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