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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Management Resource Solutions Plc | LSE:MRS | London | Ordinary Share | GB00B8BL4R23 | ORD EUR0.01 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 2.30 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMMRS
RNS Number : 9748B
Management Resource Solutions PLC
07 April 2017
Management Resource Solutions PLC
Half Year Report
Period Ended
31 December 2016
Company number: 8046513
CEO's Statement
Dear shareholders,
The Half Year results show a Net Loss Before Tax of A$3.2m on Revenue of A$20.6m.
Shareholders should be aware that the going concern basis of preparation of these interim accounts is based on the Directors assumptions, having prepared a cash flow forecast, of the Company's working capital requirements and the need to access additional equity funding or asset divestment if required within the next 12 months.
Restructure
Significantly underperforming business units within MRS necessitated a restructure of the group in October/November 2016:
Hot Features
Premium
-- The high risk underperforming contract to build aviation fuel tanks at Jackson's International Airport in Port
Moresby, Papua New Guinea was put into dispute. MRS Guernsey Limited and MRS PNG Limited, the MRS entities which
managed the PNG contract, were put into Voluntary Liquidation in December 2016 and February 2017 respectively to
quarantine any issues that may arise from this contract.
-- The other high risk underperforming contract to dismantle a Polypropylene Plant at Rosehill, Sydney was put into
dispute in November 2016 and all work was ceased. MRS Pty Ltd, the company contracted to undertake this work, was
placed into Voluntary Administration in February 2017, again to quarantine the group from losses and potential
liquidated damages claims. Bachmann Plant Hire (BPH) and MRS Services Group (MRSSG) were quarantined from this
process.
-- The oil and gas industry white collar labour hire business, which had declined through the year to the point it
was unsustainable, was also closed.
-- The Southport head office, which had supported the above sections of the business, was closed in October 2016 and
the staff were made redundant.
Non-Recurring Costs
Significant non-recurring costs have been incurred to date in FY17 to fund the restructure of MRS group as well as the acquisition and restructure of the Subzero assets to establish the MRS Services Group (MRSSG):
-- MRS Pty Ltd incurred A$600k for the acquisition of the Subzero assets
-- MRSSG incurred A$309k in relocation costs to achieve rent and occupancy cost savings of A$950k pa, A$240k in
financing costs to initiate the Hermes invoice discounting facility and A$180k in redundancy costs to achieve
A$1.2m pa reduction in overhead salary costs.
-- MRS Plc incurred A$470k for restructuring of the subsidiaries.
-- Loss on liquidation of subsidiaries of A$454k, being MRs Pty Ltd A$101k and MRS Guernsey A$353k
-- MRS PLC impairment of debtors A$543k
Of the above, A$1,920k has been recognised in the first half of FY17.
MRS Services Group Performance
Upon the acquisition of MRS Subzero, out of its Receivership, there was a requirement to make major structural changes to overhead and occupancy costs resulting in significant restructuring and non-recurring costs. This was planned prior to the acquisition. A lack of working capital and the resulting cash constraints has impacted the performance of the business. MRSSG has implemented an overhead reduction program outlined above and is in the process of implementing operating cost savings with installation of bulk oil, gas and fuel to the workshops and implementing consumable kiosks with resulting savings in consumable and inventory costs. Every facet of the business is under review to streamline costs.
Bachmann Plant Hire
All the documentation, agreements and payment of consideration are now complete for the purchase of BPH, save for the outstanding issue of new shares to the value of A$500,000, as previously announced.
BPH continues to perform well against budget. It is a mature, established business with a 50 year history of civil earthworks in Ipswich and will continue to operate effectively in this sector.
Group Performance
The business restructure, ensuing non-recurring costs and the underperformance of MRSSG have put significant strain on cash flow which has impacted the growth of the business to date and our ability to take advantage of opportunities in the market.
MRS Outlook
The focus for MRS going forward is the consolidation of the four "pillars" of the business and developing the business strategy and framework to drive the performance of the Group. When recovered from the current cash constraints the business will be in a very good position to take advantage of the coal industry upturn in the Hunter Valley and the residential growth in Southern Queensland.
On behalf of the Board, I would like to thank the MRS employees, clients, suppliers and shareholders for maintaining the belief in the Company in difficult times.
GW (Joe) Clayton
Chief Executive Officer
Management Resource Solutions PLC
Condensed Consolidated Statement of Comprehensive Income
6 months 6 months Year ended
ended ended 31
December
2015 (Unaudited)
31 December 30 June
2016 (Unaudited) 2016
(Audited)
Note $'000 $'000 $'000
Revenue 20,640 6,194 25,231
Cost of sales (18,087) (3,644) (19,536)
------------------- ------------------ -----------
Gross Profit 2,553 2,550 5,695
Administrative
expenses (6,153) (2,028) (12,800)
------------------- ------------------ -----------
Operating profit
/ (loss) (3,600) 522 (7,105)
Other Income 536 - 808
Finance costs
- interest (113) - (260)
------------------- ------------------ -----------
Profit / (loss)
before tax (3,177) 522 (6,557)
Tax (expense)/credit (853) (10) (305)
------------------- ------------------ -----------
Profit / (loss)
for the period
attributable to
equity holders
of the parent
company (4,030) 512 (6,862)
------------------- ------------------ -----------
Earnings / (loss)
per share attributable
to equity holders
of the parent
company
Basic 4 (7.0)c 1.56c (20.7)c
------------------- ------------------ -----------
Fully diluted 4 (7.0)c 1.33c (20.7)c
------------------- ------------------ -----------
For the six months ended 31 December 2016
Management Resource Solutions PLC
Condensed Consolidated Balance Sheet at 31 December 2016
At 31 December At 31 December At 30 June
2016 2015 2016
(Unaudited) (Unaudited) (Audited)
Assets $'000 $'000 $'000
Non-current assets
Property, plant,
equipment 16,168 229 13,382
Deferred tax 195 187 367
16,363 416 13,749
----------------- ----------------- -------------
Current assets
Trade and other
receivables 12,068 3,541 6,483
Other current
assets 1,602 - 234
Cash and cash
equivalents 1,154 722 951
14,824 4,263 7,668
----------------- ----------------- -------------
Total assets 31,187 4,679 21,417
----------------- ----------------- -------------
Liabilities
Current liabilities
Trade and other
payables 9,088 3,005 12,762
Borrowings 8,001 - 4,802
Other current
liabilities 6,495 - -
----------------- ----------------- -------------
23,584 3,005 17,564
----------------- ----------------- -------------
Non-current liabilities
Borrowings 6,378 27 5,257
Other non-current
liabilities 3,726 - 3,746
Deferred tax 6 6 6
10,110 33 9,009
----------------- ----------------- -------------
Total liabilities 33,694 3,038 26,573
----------------- ----------------- -------------
Net (liabilities)
/ assets (2,507) 1,641 (5,156)
================= ================= =============
Equity attributable
to equity holders
of the parent
Share capital 37,207 36,623 36,677
Share premium 7,686 1,221 1,744
Issue costs reserve (332) (332) (332)
Reorganisation
reserve (36,032) (36,032) (36,032)
Retained earnings (11,036) 161 (7,213)
Total equity attributable
to equity holders
of the parent (2,507) 1,641 (5,156)
================= ================= =============
Management Resource Solutions PLC
Condensed Consolidated Statement of Changes in Equity
For the six months ended 31 December 2016
Issue
Share Share costs Reorganisation Retained Total
capital premium reserve reserve earnings equity
$'000 $'000 $'000 $'000 $'000 $'000
At 1 July 2015 36,623 1,221 (332) (36,032) (351) 1,129
Profit for the
period - - - - 512 512
Total comprehensive
income - - - - 512 512
--------- --------- --------- --------------- ---------- ---------
At 31 December
2015 36,623 1,221 (332) (36,032) 161 1,641
Loss for the
period - - - - (7,374) (7,374)
Total comprehensive
income - - - - (7,374) (7,374)
--------- --------- --------- --------------- ---------- ---------
Other movements
Issue of shares 577 - - - - 577
Total other
movements 577 - - - - 577
--------- --------- --------- --------------- ---------- ---------
At 30 June 2016 36,623 1,221 (332) (36,032) (7,213) (5,156)
Loss for the
period - - - - (4,030) (4,030)
Total comprehensive
income - - - - (4,030) (4,030)
--------- --------- --------- --------------- ---------- ---------
Other movements
Issue of shares 530 5,942 - - - 6,472
Total other
movements 530 5,942 - - 207 6,679
--------- --------- --------- --------------- ---------- ---------
At 31 December
2016 37,207 7,686 (332) (36,032) (11,036) (2,507)
========= ========= ========= =============== ========== =========
Management Resource Solutions PLC
Condensed Consolidated Statement of Cash Flows
For the six months ended 31 December 2016
6 months 6 months Year ended
ended ended 30 June
31 December 31 December 2016 (Audited)
2016 2015
(Unaudited) (Unaudited) $'000
$'000 $'000
Cash flows from operating
activities
Receipts from
customers 15,440 4,693 21,653
Payments to suppliers
and employees (17,508) (4,865) (20,863)
Interest received - - 8
Finance costs (113) (32) (260)
Income tax
paid (347) (2) (322)
------------- ------------- ----------------
Net cash flow from
operating activities (2,528) (206) 216
------------- ------------- ----------------
Cash flows from investing
activities
Acquisition of subsidiaries (1,000) (10,675)
Proceeds from disposal 116 - -
of assets
Purchase of non-current
assets - - (37)
------------- ------------- ----------------
Net cash flow from
investing activities (884) - (10,712)
------------- ------------- ----------------
Cash flows from financing
activities
Increase/(decrease)
in borrowings 3,615 8 (9,950)
Issue of shares
net of costs - - 577
Dividends paid - - -
------------- ------------- ----------------
Net cash flow from
financing activities 3,615 8 10,527
------------- ------------- ----------------
Net (decrease)/increase
in cash held 203 (198) 31
------------- ------------- ----------------
Cash and cash equivalents
at 1 July 2016 951 920 920
------------- ------------- ----------------
Cash and cash equivalents
at 31 December 2016 1,154 722 951
------------- ------------- ----------------
Management Resource Solutions PLC
Notes forming part of the Interim Results
For the six months ended 31 December 2016
1. Accounting Policies
The condensed consolidated unaudited interim financial information set out in this report is based on the financial statements of Management Resource Solutions plc ("MRS"). The condensed financial information should be read in conjunction with the annual financial statements for the year ended 30 June 2016, which were prepared in accordance with International Financial Reporting Standards. The interim financial information for the Group for the six months ended 31 December 2016 was approved and authorised for issue by the Board on 7th April 2017. This interim financial information has been prepared in accordance with the accounting policies that are expected to be applied in the Report and Accounts of MRS for the year ending 30 June 2017 and are consistent with International Financial Reporting Standards adopted for use in the European Union.
2. Basis of preparation
The financial information for the six months ended 31 December 2016 does not constitute the Company's statutory financial statements for those periods. The comparative financial information for the full year ended 30 June 2016 has been derived from the statutory financial statements for that period. The statutory accounts for the year ended 30 June 2016 have been filed with the Registrar of Companies.
The financial statements are presented in Australian Dollars and all values are rounded to the nearest thousand dollars ($'000) except where otherwise indicated.
3. Going concern
The interim financial information has been prepared on the going concern basis as, in the opinion of the Directors, at the time of approving, there is a reasonable expectation that the Group will continue in operational existence for the foreseeable future.
As reported in the Annual Report for the year ended 30 June 2016, closure of the former consulting business has brought major cost savings and the Group has secured further finance facilities. Based on these developments and on the Company's ability to modify expenditure outlays further if required, and to source additional funds, the Directors consider there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable, and therefore the going concern basis of preparation is considered to be appropriate for the financial report for the year ended 31 December 2016. The Board of Directors are aware, having prepared a cash flow forecast, of the Company's working capital requirements and the need to access additional equity funding or asset divestment if required within the next 12 months.
In the event that the Company is not able to continue as a going concern, it may be required to realise assets and extinguish liabilities other than in the normal course of business and perhaps at amounts different to those stated in its financial report.
4. Earnings / (loss) per share
Earnings / (loss) per share is calculated on the reported loss for the period of $4,030,000 and on 57,554,573 ordinary shares, being the weighted average number of shares in issue throughout the period ended 31 December 2016.
For diluted earnings per share, the weighted average number of ordinary shares in issue has been adjusted to assume conversion of all dilutive potential ordinary shares. The Company has two classes of dilutive potential ordinary shares, being share options granted to directors and employees and warrants to subscribe for ordinary shares issued in connection with the placing of ordinary shares on 11 December 2014.
Management Resource Solutions PLC
Notes forming part of the Interim Results
For the six months ended 31 December 2016
5. Subsequent events
-- On 17 February 2017 MRS PNG Limited, a wholly owned subsidiary, was placed into Voluntary Liquidation.
-- On 7 February 2017 Management Resource Solutions Pty Ltd was placed into Voluntary Administration.
-- On 17 March 2017 Murray d'Almeida resigned as a director and Chris Berkefeld was reappointed as director and
chairman.
6. Acquisition of business
On 30 September 2016 the Company, through an Australian subsidiary, acquired the business and various assets of SubZero Group Limited ("SZG") for a total consideration of $6.12 million (comprising a cash payment of $1 million on settlement, a deferred payment of $500,000 payable in cash 12 months after the date of completion and the issue of 7,596,967 new ordinary shares of Û0.01 each in Management Resource Solutions plc).
The acquisition had the following estimated effect on the group's assets and liabilities.
Fair
value
$'000
Fair value of net assets
acquired:
Plant and equipment 4,200
Inventories 600
Work in Progress 800
Prepayments 400
Annual and other employee
entitlements (1,043)
4,957
7. Interim Statement
Copies of this Interim report for the six months ended 31 December 2016 will be available on the company's website www.mrsplc.net
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFVSSSIDIID
(END) Dow Jones Newswires
April 07, 2017 11:03 ET (15:03 GMT)
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