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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Public Rec. | LSE:PUG | London | Ordinary Share | GB00B00LM737 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 34.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
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RNS Number:4098E
Public Recruitment Group plc
25 September 2007
25 September 2007
Public Recruitment Group PLC
Interim Report 2007 for the 26-week period ended 30 June 2007
Business and financial highlights
o Disposal of healthcare division for a consideration of #5.5m plus the
assumption by the buyer of #2.9m of debt
o Management restructured to reflect the convergence of education and
social work
o #4.9m raised through placing of 12m new ordinary shares
o Net debt reduced by 48% to #12.6m (2006: #24.5m)
o Top three position in our chosen sectors of education and social work
o "TeachIn" schemes have grown from 9 to 13 accounts, with 3 of these in
the North of England
o Conversion of net fee income to normalised EBITA* of 36% (2006: 38%)
o Normalised profit before tax** #2.2m (2006: #2.2m)
o Profit before tax #0.6m (2006: #1.9m)
o Basic earnings per share of (0.4)p (2006: 4.8p)
o Adjusted earnings per share 4.2p (2006: 5.5p)
Luke Johnson, Chairman of PRG, commented:
"This has been a period of unprecedented change for the Group - a process the
new management team have executed well despite challenging operating conditions.
PRG managed to reduce its debt by 48%, partly through a new capital raising that
brought new strategic investors into the business. The Group also maintained a
top three position in its chosen sectors and completed a well-priced disposal of
its healthcare division. To manage all that - while remaining profitable - is a
very creditable feat indeed."
*Normalised EBITA is profit from operations before exceptional items
**Normalised profit before tax is profit before tax adjusted for exceptional
items
Contact: Dean Kelly
Chief Executive Officer, Public Recruitment Group PLC
Daniel Urmson
Group Finance Director, Public Recruitment Group PLC
Robert Kelsey
Moorgate Group
Telephone: Moorgate, +44 (0) 20 7953 7772 until 18:00
Thereafter: Public Recruitment Group PLC, +44 (0) 114 283 4925
Chairman's Statement
The period under review has been one of considerable change for the Group. These
are also the first set of interim results to have been prepared under
International Financial Reporting Standards (IFRS).
The Healthcare division was sold in April this year for a consideration of #5.5
million and the assumption of working capital funding. The Board felt that this
was the least attractive of the markets served by the business and that the
locum division absorbed disproportionate amounts of working capital.
Shortly afterwards the Board was restructured. Dean Kelly was promoted to Chief
Executive and Matt Ellis became Chief Operating Officer. Darren McLaney stepped
down to become a Non-Executive Director and Nick Williams resigned. Daniel
Urmson was promoted to Finance Director and Dennis Hall became a non-Executive
Director. Meanwhile, I became Chairman, and subscribed for approximately 28% of
the enlarged share capital at 41p. This investment and the disposal of the
Healthcare Division reduced the remaining debt by half, to around #12 million.
Post disposal, the Group was able to reduce central costs and focus exclusively
on staffing for the education and social work sectors. Both markets offer more
attractive margins and prospects, as well as a higher level of correlatively
beneficial processes.
PRG was the first consultancy to amalgamate education and social work divisions.
This was a strategic move that helped to exploit internal synergies - and one
recently mirrored by the goverments restructure of the DfES to DfCSF. Our unique
position has highlighted new opportunities and bolstered our plans for
diversification, while fostering the Group's strategy to provide a service
support delivery system that will reposition the enterprise amongst its peers.
Outlook
The Group has seen significant changes during the first half of 2007, with a
material change to both the board and senior management team. Its continued
restructuring and change management programme has set the platform for the
Group's alignment and diversification to reflect its future strategy.
Although public sector recruitment remains challenging, the recent goverment
departmental changes and policy enforced procedures have mirrored the
pre-emptive change made by the Group. Indeed, our strategy to amalgamate
education and social work has proved to be both an innovative and intuitive
decision that has raised the Group's profile within local goverment. We are
enthused by the Group's new structure and drive, and we remain confident about
the future.
Luke Johnson
Chairman
25 September 2007
Public Recruitment Group PLC
Consolidated income statement for the twenty-six week period ended 30 June 2007
__________________________________________________________________________________________________________________
Note Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Continuing Operations
Revenue 31,733 35,019 59,999
Cost of sales (23,843) (26,567) (45,166)
_______ _______ _______
Gross profit 7,890 8,452 14,833
Administrative expenses (6,682) (5,263) (9,712)
______ _______ _______
__________________________________________________________________________________________________________________
Profit from operations before exceptional
items 2,835 3,220 5,457
Exceptional items 3 (1,627) (31) (336)
__________________________________________________________________________________________________________________
Profit from operations 1,208 3,189 5,121
Finance costs 4 (952) (1,348) (2,227)
Finance income 321 30 21
_______ _______ _______
Profit before tax 577 1,871 2,915
Tax expense (217) (569) (699)
_______ _______ _______
Profit for the period from continuing
operations 360 1,302 2,216
Discontinued Operations
(Loss)/profit for the period from
discontinued operations 5 (518) 91 236
_______ _______ _______
(Loss)/profit for the period attributable to
the equity holders of the parent (158) 1,393 2,452
_______ _______ _______
Basic earnings per share (pence) 7
- continuing operations 1.0 4.5 7.7
- discontinued operations (1.4) 0.3 0.8
_______ _______ _______
- basic earnings per share (0.4) 4.8 8.5
_______ _______ _______
Diluted earnings per (pence) 7
- continuing operations 1.0 4.3 7.7
- discontinued operations (1.4) 0.3 0.8
_______ _______ _______
- diluted earnings per share (0.4) 4.6 8.5
_______ _______ _______
Public Recruitment Group PLC
Consolidated balance sheet at 30 June 2007
As at As at As at
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Assets
Non-current assets
Property, plant and equipment (PPE) 383 607 501
Intangible assets 36,960 42,969 42,486
Deferred tax assets 50 153 96
_______ _______ _______
Total non-current assets 37,393 43,729 43,083
Current assets
Trade and other receivables 8,340 12,566 10,476
Other financial assets 207 - -
Cash and cash equivalents 1,384 1,460 351
_______ _______ _______
Total current assets 9,931 14,026 10,827
_______ _______ _______
Total assets 47,324 57,755 53,910
_______ _______ _______
Liabilities
Current liabilities
Short term borrowings (2,022) (7,877) (7,353)
Current element of long term borrowings (2,727) (3,083) (2,778)
Trade and other payables (5,480) (8,401) (5,708)
Other financial liabilities - (149) (94)
Current tax liabilities (381) (1,495) (513)
_______ _______ _______
Total current liabilities (10,610) (21,005) (16,446)
Non-current liabilities
Long term borrowings (9,251) (14,946) (14,457)
Trade and other payables (665) (1,734) (952)
_______ _______ _______
Total non-current liabilities (9,916) (16,680) (15,409)
_______ _______ _______
Total liabilities (20,526) (37,685) (31,855)
_______ _______ _______
TOTAL NET ASSETS 26,798 20,070 22,055
_______ _______ _______
Public Recruitment Group PLC
Consolidated balance sheet at 30 June 2007 (Continued)
As at As at As at
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Capital and reserves attributable to
equity holders of the company
Share capital 4,511 2,891 3,291
Share premium reserve 15,996 12,316 12,316
Share scheme reserve 42 595 41
Merger reserve - (425) (425)
Other reserves 3,610 3,710 4,790
Retained earnings 2,639 983 2,042
_______ _______ _______
TOTAL EQUITY 26,798 20,070 22,055
_______ _______ _______
Public Recruitment Group PLC
Consolidated statement of changes in equity for the twenty-six week period ended
30 June 2007
Attributable to equity holders of the parent
Share Share Share Merger Other Retained Total
capital premium scheme reserve reserve earnings equity
reserve
#'000 #'000 #'000 #'000 #'000 #'000 #'000
Balance as at 1 January 2006 2,828 12,316 569 (425) 3,506 (410) 18,384
Changes in equity for 2006
Share scheme charge - - 26 - - - 26
______ _______ _______ ______ _______ _______ _______
Net income recognised directly in equity - - 26 - - - 26
Profit for the period - - - - - 1,393 1,393
______ _______ _______ ______ _______ _______ _______
Total recognised income and expense
for the period - - 26 - - 1,393 1,419
Issue of share capital 63 - - - 204 - 267
______ _______ _______ ______ _______ _______ _______
Balance as at 30 June 2006 2,891 12,316 595 (425) 3,710 983 20,070
Changes in equity for 2006
Share scheme charge - - (554) - - - (554)
______ _______ _______ ______ _______ _______ _______
Net income recognised directly in equity - - (554) - - - (554)
Profit for the period - - - - - 1,059 1,059
______ _______ _______ ______ _______ _______ _______
Total recognised income and expense
for the period - - (554) - - 1,059 505
Issue of share capital 400 - - - 1,080 - 1,480
______ _______ _______ ______ _______ _______ _______
Balance as at 31 December 2006 3,291 12,316 41 (425) 4,790 2,042 22,055
Changes in equity for 2007
Release of merger and other reserves
on disposal of discontinued
operations - - - 425 (1,180) 755 -
Share scheme charge - - 1 - - - 1
______ _______ _______ ______ _______ _______ _______
Net income recognised directly in equity - - 1 425 (1,180) 755 1
Loss for the period - - - - - (158) (158)
______ _______ _______ ______ _______ _______ _______
Total recognised income and expense
for the period - - 1 425 (1,180) 597 (157)
Issue of share capital 1,220 3,680 - - - - 4,900
______ _______ _______ ______ _______ _______ _______
Balance at 30 June 2007 4,511 15,996 42 - 3,610 2,639 26,798
______ ______ ______ ______ ______ ______ ______
Public Recruitment Group PLC
Consolidated cash flow statement for the twenty-six week period ended 30 June
2007
Note Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Operating activities
Profit from continuing operations 1,208 3,189 5,121
Profit from discontinued operations 5 116 302 564
Adjustments for:
Depreciation 133 177 334
Share based payments 1 26 (528)
Loss/ (gain) on sale of property, plant and
equipment 7 (2) 9
_______ _______ _______
Operating profit before changes in working
capital and provisions 1,465 3,692 5,500
(Increase)/decrease in trade and other
receivables (2,122) (703) 1,210
Increase/(decrease) in trade and other
payables 296 (553) (1,042)
_______ _______ _______
Cash generated from operations (361) 2,436 5,668
_______ _______ _______
Income taxes paid (223) (245) (1,288)
_______ _______ _______
Cash flows from operating activities (584) 2,191 4,380
Investing activities
Acquisition of subsidiary, net of cash
acquired - (1,787) (2,521)
Disposal of subsidiary, net of cash disposed 5,387 - -
Purchases of property, plant and equipment (125) (340) (564)
Sale of property, plant and equipment - 289 450
Development costs (42) - -
Interest received 23 30 21
_______ _______ _______
4,659 383 1,766
Financing activities
Issue of ordinary shares 5,000 - -
Costs of share issue (100) - (250)
Repayment of loan notes (2,553) (2,047) (3,515)
Movement in short term debt (2,536) 258 (266)
Proceeds from bank borrowings - 14,475 16,058
Repayment of bank borrowings (2,774) (12,562) (13,697)
Repayment of finance lease creditors (3) - (2)
Interest paid (660) (1,160) (1,856)
_______ _______ _______
Increase/(decrease) in cash and cash
equivalents 1,033 (653) (1,762)
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
1. Accounting policies
Basis of preparation
The interim financial information for the twenty-six week period ended 30 June
2007 has been prepared in accordance with the accounting policies that will
apply for the year ended 31 December 2007 which will follow the International
Financial Reporting Standards (IFRS) and interpretations as endorsed by the
European Union.
The interim financial information for the twenty-six week period ended 30 June
2007 does not constitute statutory accounts within the meaning of section 240 of
the Companies Act 1985. The comparatives for the full year ended 31 December
2006 are not the company's full statutory accounts for that year. A copy of the
statutory accounts for that year has been delivered to the Registrar of
Companies. The auditors' report on those accounts was unqualified, did not
include references to any matters to which the auditors drew attention by way of
emphasis without qualifying their report and did not contain a statement under
section 237(2)-(3) of the Companies Act 1985.
First-time adoption of International Financial Reporting Standards
In preparing these financial statements, the group has elected to apply the
following transition arrangements permitted by IFRS 1 'First-time Adoption of
International Financial Reporting Standards':
* Business combinations effected before 1 January 2006, including those that
were accounted for using the merger method of accounting under UK accounting
standards have not been restated.
* The carrying amount of capitalised goodwill at 31 December 2005 that arose
on business combinations accounted for using the acquisition methods under
UK GAAP was frozen at this amount and tested for impairment at 1 January
2006.
* IFRS 2 'Share-based payments' has been applied to employee options granted
after 7 November 2002 that had not vested by 1 January 2006.
Except as noted above, the following principal accounting policies have been
applied consistently in the preparation of these accounts:
Basis of consolidation
Where the company has the power, either directly or indirectly, to govern the
financial and operating policies of another entity or business so as to obtain
benefits from its activities, it is classified as a subsidiary. The consolidated
financial statements present the results of the company and its subsidiaries ("
the group") as if they formed a single entity. Intercompany transactions and
balances between group companies are therefore eliminated in full.
Revenue
Revenue represents sales to external clients at invoiced amounts less value
added tax and is shown net of any discounts allowed. Income from temporary
placements is recognised at the end of a period of work. Income from permanent
placements is recognised at the point of acceptance by both parties when the
group's contractual obligations have been fulfilled.
Business combinations
The consolidated financial statements incorporate the results of business
combinations using the purchase method other than disclosed above (see '
first-time adoption'). In the consolidated balance sheet, the acquiree's
identifiable assets, liabilities and contigent liabilities are initially
recognised at their fair value at the acquisition date. The results of acquired
operations are included in the consolidated income statement from the date on
which control is obtained.
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
1. Accounting policies (Continued)
Goodwill
Goodwill represents the excess of the cost of a business combination over the
interest in the fair value of identifiable assets, liabilities and contigent
liabilities acquired. Cost comprises the fair value of assets acquired,
liabilities assumed and equity instruments issued, plus any direct costs of
acquisition.
Goodwill is capitalised as an intangible asset with any impairment in carrying
value being charged to the income statement.
Where the fair value of identifiable asstes, liabilities and contingent
liabilities exceed the fair value of consideration paid, the excess is credited
in full to the income statement.
Impairment of non-financial assets
Impairment tests on goodwill and other intangible assets with indefinite useful
economic lives are undertaken annually on 31 December. Other non-financial
assets are subject to impairment tests whenever events or changes in
circumstances indicate that their carrying amount may not be recoverable. Where
the carrying value of an asset exceeds its recoverable amount (i.e. the higher
of value in use and fair value less costs to sell), the asset is written down
accordingly.
Where it is not possible to estimate the recoverable amount of an individual
asset, the impairment test is carried out on the asset's cash-generating unit
(i.e. the lowest group of assets in which the asset belongs for which there are
separately identifiable cash flows). Goodwill is allocated on initial
recognition to each of the group's cash-generating units that are expected to
benefit from the synergies of the combination giving rise to the goodwill.
Impairment charges are included in the exceptional items line item of the income
statement, except to the extent that they reverse gains previously recognised in
the statement of recognised income and expense.
Internally generated intangible assets (research and development costs)
Expenditure on internally developed products is capitalised if it can be
demonstrated that:
* it is technically feasible to develop the product for it to be sold;
* adequate resources are available to complete the development;
* there is an intention to complete and sell the product;
* the group is able to sell the product;
* sale of the product will generate future economic benefits; and
* expenditure on the project can be measured reliably.
Capitalised development costs are amortised over the periods the group expects
to benefit from selling the products developed. The amortisation expense is
included within the administrative expenses line in the income statement.
Development expenditure not satisfying the above criteria and expenditure on the
research phase of internal projects are recognised in the income statement as
incurred.
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
1. Accounting policies (Continued)
Deferred taxation
Deferred tax assets are recognised where the carrying amount of an asset or
liability in the balance sheet differs to its tax base, except for differences
arising on:
* the initial recognition of goodwill;
* goodwill for which amortisation is not tax deductible;
* the initial recognition of an asset or liability in a transaction which is
not a business combination and at the time of the transaction affects
neither accounting nor taxable profit; and
* investments in subsidiaries and jointly controlled entities where the group
is able to control the timing of the reversal of the difference and it is
probable that the difference will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it is
possible that taxable profit will be available against which the difference can
be utilised.
The amount of the asset or liability is determined using tax rates that have
been enacted or substantially enacted by the balance sheet date and are expected
to apply when the deferred tax liabilities/(assets) are settled/(recovered).
Deferred tax balances are not discounted.
Deferred tax assets and liabilities are offset when the group has a legally
enforceable right to offset current tax assets and liabilities and the deferred
tax assets and liabilities relate to taxes levied by the same tax authority on
either:
* the same taxable group company; or
* different group entities which intend either to settle current tax assets
and liabilities on a net basis, or to realise the assets and settle the
liabilities simultaneously, in each future period in which significant
amounts of deferred tax assets or liabilities are expected to be settled
or recovered.
Exceptional Items
Exceptional items are disclosed separately on the face of the income statement.
They include any components of financial performance which management consider
significant to the group's results and/or which separate disclosure would assist
in better understanding these. Such items may include:
* Restructuring or rationalisation programmes
* The sale or impairment of tangible or intangible assets
* Other non-recurring items.
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards (IFRS)
Reconciliations and explanatory notes on how the transition to IFRS has affected
profit and net assets previously reported under UK Generally Accepted Accounting
Principles are given below:
Profit and loss account reconciliation for the twenty-six week period ended 30
June 2006
Sub-note UK GAAP Adjustments IFRS*
#'000 #'000 #'000
Revenue 49,306 - 49,306
Cost of sales (38,904) - (38,904)
_______ _______ _______
Gross profit 10,402 - 10,402
Amortisation of goodwill (i) (1,170) 1,170 -
Exceptional items (46) - (46)
Other administrative expenses (ii) (6,606) (259) (6,865)
_______ _______ _______
Profit from operations 2,580 911 3,491
Finance costs (iii) (1,376) (144) (1,520)
Finance income 30 - 30
_______ _______ _______
Profit before tax 1,234 767 2,001
Tax expense (729) 121 (608)
_______ _______ _______
Profit for the period 505 888 1,393
_______ _______ _______
* The results include amounts relating to discontinued operations which are
shown in note 5.
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards
(IFRS) (Continued)
Profit and loss account reconciliation for the year ended 31 December 2006
Sub-note UK GAAP Adjustments IFRS*
#'000 #'000 #'000
Revenue 86,745 - 86,745
Cost of sales (68,288) - (68,288)
_______ _______ _______
Gross profit 18,457 - 18,457
Amortisation of goodwill (i) (2,362) 2,362 -
Exceptional items (362) - (362)
Other administrative expenses (ii) (12,396) (14) (12,410)
_______ _______ _______
Profit from operations 3,337 2,348 5,685
Finance costs (iii) (2,435) (91) (2,526)
Finance income 21 - 21
_______ _______ _______
Profit before tax 923 2,257 3,180
Tax expense (759) 31 (728)
_______ _______ _______
Profit for the period 164 2,288 2,452
_______ _______ _______
* The results include amounts relating to discontinued operations which are
shown in note 5.
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards
(IFRS) (Continued)
Balance sheet reconciliation as at 1 January 2006
Sub-note UK GAAP Adjustments IFRS
#'000 #'000 #'000
Non-current assets
Property, plant and equipment 731 - 731
Intangible assets (i) 43,905 (1,039) 42,866
Deferred tax asset 32 - 32
_______ _______ _______
Total non-current assets 44,668 (1,039) 43,629
_______ _______ _______
Current assets
Trade and other receivables 11,887 - 11,887
Cash and cash equivalents 2,113 - 2,113
_______ _______ _______
Total current assets 14,000 - 14,000
_______ _______ _______
Total assets 58,668 (1,039) 57,629
_______ _______ _______
Current liabilities
Short term borrowings (7,619) - (7,619)
Current element of long term borrowings (1,532) - (1,532)
Trade and other payables (15,634) - (15,634)
Other financial liabilities (iii) (5) (1) (6)
Current tax liabilities (1,019) - (1,019)
_______ _______ _______
Total current liabilities (25,809) (1) (25,810)
_______ _______ _______
Non-current liabilities
Long term borrowings (11,761) - (11,761)
Trade and other payables (1,674) - (1,674)
_______ _______ _______
Total non-current liabilities (13,435) - (13,435)
_______ _______ _______
Total liabilities (39,244) (1) (39,245)
_______ _______ _______
TOTAL NET ASSETS AND EQUITY 19,424 (1,040) 18,384
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards
(IFRS) (Continued)
Balance sheet reconciliation as at 30 June 2006
Sub-note UK GAAP Adjustments IFRS
#'000 #'000 #'000
Non-current assets
Property, plant and equipment 607 - 607
Intangible assets (i) 42,838 131 42,969
Deferred tax asset 32 121 153
_______ _______ _______
Total non-current assets 43,477 252 43,729
_______ _______ _______
Current assets
Trade and other receivables 12,566 - 12,566
Cash and cash equivalents 1,460 - 1,460
_______ _______ _______
Total current assets 14,026 - 14,026
_______ _______ _______
Total assets 57,503 252 57,755
_______ _______ _______
Current liabilities
Short term borrowings (7,877) - (7,877)
Current element of long term borrowings (3,083) - (3,083)
Trade and other payables (ii) (8,142) (259) (8,401)
Other financial liabilities (iii) (5) (144) (149)
Current tax liabilities (1,495) - (1,495)
_______ _______ _______
Total current liabilities (20,602) (403) (21,005)
_______ _______ _______
Non-current liabilities
Long term borrowings (14,946) - (14,946)
Trade and other payables (1,734) - (1,734)
_______ _______ _______
Total non-current liabilities (16,680) - (16,680)
_______ _______ _______
Total liabilities (37,282) (403) (37,685)
_______ _______ _______
TOTAL NET ASSETS AND EQUITY 20,221 (151) 20,070
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards (IFRS)
(Continued)
Balance sheet reconciliation as at 31 December 2006
Sub-note UK GAAP Adjustments IFRS
#'000 #'000 #'000
Non-current assets
Property, plant and equipment 501 - 501
Intangible assets (i) 41,163 1,323 42,486
Deferred tax asset 65 31 96
_______ _______ _______
Total non-current assets 41,729 1,354 43,083
_______ _______ _______
Current assets
Trade and other receivables 10,476 - 10,476
Cash and cash equivalents 351 - 351
_______ _______ _______
Total current assets 10,827 - 10,827
_______ _______ _______
Total assets 52,556 1,354 53,910
_______ _______ _______
Current liabilities
Short term borrowings (7,353) - (7,353)
Current element of long term borrowings (2,778) - (2,778)
Trade and other payables (ii) (5,694) (14) (5,708)
Other financial liabilities (iii) (3) (91) (94)
Current tax liabilities (513) - (513)
_______ _______ _______
Total current liabilities (16,341) (105) (16,446)
_______ _______ _______
Non-current liabilities
Long term borrowings (14,457) - (14,457)
Trade and other payables (952) - (952)
_______ _______ _______
Total non-current liabilities (15,409) - (15,409)
_______ _______ _______
Total liabilities (31,750) (105) (31,855)
_______ _______ _______
TOTAL NET ASSETS AND EQUITY 20,806 1,249 22,055
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
2. First time adoption of International Financial Reporting Standards (IFRS)
(Continued)
Cash flow statement for the twenty-six week period ended 30 June 2006 and year
ended 31 December 2006
The only changes to the cash flow statement are presentational.
Adjustments
Explanations of the adjustments made to the UK GAAP income statements and
balance sheets are as follows:
(i) Business Combinations (IFRS 3)
IFRS 3 requires that goodwill arising on acquisitions is not amortised, but is
subject to annual impairment testing in accordance with IAS 36 "Impairment of
Assets".
This impact of adopting these standards is an increase in profit after tax of
#2,362,000 for the year ended 31 December 2006 (30 June 2006: #1,170,000), and
an increase in net assets of #1,323,000 at 31 December 2006 (30 June 2006:
#131,000). Net assets at 1 January 2006 are reduced by #1,039,000.
(ii) Employee Benefits (IAS 19)
IAS 19 requires all employee benefits, including paid annual leave, to be
accrued on a pro rata basis.
The impact of adopting IAS 19 is an increase in administrative expenses and
trade and other payables of #14,000 at 31 December 2006 (30 June 2006:
#259,000). This results in a decrease in both profit after tax and net assets
of #10,000 for the year ended 31 December 2006 (twenty-six weeks ended 30 June
2006: #181,000).
(iii) Financial Instruments: Recognition and Measurement (IAS 39)
IAS 39 requires financial assets and liabilities to be recognised initially at
fair value. Where these are financial derivatives subsequent changes in fair
value are recorded directly in the income statement. Public Recruitment Group
PLC holds a number of interest rate swaps which are required to be included at
fair value by IAS 39.
The impact of adopting IAS 39 is an increase in finance costs and other
financial liabilities of #91,000 at 31 December 2006 (30 June 2006: #144,000, 1
January 2006: #1,000). This results in a decrease in profit after tax and net
assets of #64,000 at 31 December 2006 (30 June 2006: #101,000, 1 January 2006:
#1,000).
The fair value of interest rate swaps at 31 December 2005 has been used as the
opening value under IFRS at 1 January 2006.
3. Exceptional items
Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Termination and office closure costs 1,627 31 336
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
4. Finance costs
Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Exceptional finance costs - restructuring - 340 340
Other finance costs 952 1,008 1,887
_______ _______ _______
952 1,348 2,227
_______ _______ _______
5. Discontinued operations
In April 2007, the group sold Public Recruitment Group Holdings Limited. Assets
and liabilities relating to this operation are not classified as held-for-sale
at 30 June 2006 or 31 December 2006 in accordance with IFRS 5 'Non-current
Assets Held for Sale and Discontinued Operations' as the sale was not highly
probable.
The income statement includes the following amounts relating to discontinued
operations:
Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Revenue 10,150 14,287 26,746
Cost of sales (8,946) (12,337) (23,122)
_______ _______ _______
Gross profit 1,204 1,950 3,624
Exceptional items - (15) (26)
Other administrative expenses (1,088) (1,633) (3,034)
_______ _______ _______
Profit from operations 116 302 564
Finance costs (55) (172) (299)
_______ _______ _______
Profit before tax 61 130 265
Tax expense (1) (39) (29)
Loss on disposal of discontinued operations (578) - -
_______ _______ _______
(Loss)/profit for the period on discontinued operations (518) 91 236
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
6. Dividends
There were no dividends declared or paid during the period.
7. Basic, diluted and adjusted earnings per share
Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
Pence Pence Pence
Basic earnings per share (pence)
Continuing operations 1.0 4.5 7.7
Discontinued operations (1.4) 0.3 0.8
_______ _______ _______
Basic earnings per share (0.4) 4.8 8.5
Exceptional items (net of tax) 3.2 1.0 1.7
Loss/(profit) from discontinued operations 1.4 (0.3) (0.8)
_______ _______ _______
Adjusted earnings per share 4.2 5.5 9.4
_______ _______ _______
Diluted earnings per share (pence)
Continuing operations 1.0 4.3 7.7
Discontinued operations (1.4) 0.3 0.8
_______ _______ _______
Diluted earnings per share (0.4) 4.6 8.5
_______ _______ _______
Calculation of basic and adjusted earnings
#'000 #'000 #'000
Profit from continuing operations 360 1,302 2,216
(Loss)/profit from discontinued operations (518) 91 236
_______ _______ _______
Basic earnings (158) 1,393 2,452
Exceptional items (net of tax) 1,141 270 491
Loss/(profit) from discontinued operations 518 (91) (236)
_______ _______ _______
Adjusted earnings 1,501 1,572 2,707
_______ _______ _______
Public Recruitment Group PLC
Notes to the Interim Report for the twenty-six week period ended 30 June 2007
(Continued)
7. Basic, diluted and adjusted earnings per share (Continued)
Twenty-six week Twenty-six week
period ended period ended Year ended
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
Number Number Number
Calculation of number of shares 000's 000's 000's
Weighted average number of shares in issue
during the period
35,325 28,747 28,854
Contingent consideration - 1,321 -
Potentially dilutive shares in issue - 444 -
_______ _______ _______
35,325 30,512 28,854
_______ _______ _______
Certain employee options have not been included in the calculation of diluted
EPS because their exercise is contingent on the satisfaction of certain criteria
that had not been met at the end of the period. In addition, certain employee
options have also been excluded from the calculation of diluted EPS as their
exercise price is greater than the weighted average share price during the year
(i.e. they are out-of-the-money) and therefore would not be advantageous for the
holders to exercise those options.
8. Analysis of net debt
As at As at As at
30 June 2007 30 June 2006 31 December 2006
(unaudited) (unaudited) (unaudited)
#'000 #'000 #'000
Cash at bank and in hand 1,384 1,460 351
_______ _______ _______
Net cash 1,384 1,460 351
_______ _______ _______
Debt due within one year (4,749) (12,043) (10,131)
Debt due after one year (9,251) (13,863) (14,457)
Finance leases - (5) (3)
_______ _______ _______
Debt (14,000) (25,911) (24,591)
_______ _______ _______
Net debt (12,616) (24,451) (24,240)
_______ _______ _______
Independent review report to Public Recruitment Group PLC
Introduction
We have been instructed by the company to review the financial information for
the twenty-six week period ended 30 June 2007 on pages 3 to 19. 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.
Our report has been prepared in accordance with the terms of our engagement to
assist the company in meeting the requirements of the rules of the London Stock
Exchange for companies trading securities on the Alternative Investment Market
and for no other purpose. No person is entitled to rely on this report unless
such a person is a person entitled to rely upon this report by virtue of and for
the purpose of our terms of engagement or has been expressly authorised to do so
by our prior written consent. Save as above, we do not accept responsibility
for this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
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 in accordance with the rules of
the London Stock Exchange for companies trading securities on the Alternative
Investment Market which require that the half-yearly report be presented and
prepared in a form consistent with that which will be adopted in the company's
annual accounts having regard to the accounting standards applicable to such
annual accounts.
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 by auditors
of fully listed companies. 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 twenty-six week
period ended 30 June 2007.
BDO STOY HAYWARD LLP
Chartered Accountants
Epsom
25 September 2007
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SEEESLSWSEFU
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