Staffline Share Discussion Threads

[hamhamham1] 20/3/2023 19:15

I would be more worried about owning companies with huge debts or little turnover in these climbs.
Here, for me, seems OK to weather the storm. But time will tell.

[tia01] 20/3/2023 19:05

HHH1
I like you and believe we will get a takeover at some point. The problem is the market just find any reason to sell any share at the moment but this has held up in the recent downturn so maybe it’s our turn to shine.
I’ve come to a belief similar to you I’m here for the longer term so happy to hold and recently added some more

[hamhamham1] 20/3/2023 18:33

Well, am happy with the last update, so happy to hold for the medium term

[tia01] 20/3/2023 18:30

HHH1
Last time we had an update it dropped immediately ro 33p then went on a run up to 42p. I personally thought this was a turning point but unfortunately we sold off again. It’s a frustrating time for investors but the whole market is in a terrible place. I think it’s a good price for LTHs but nothing surprises you with this market.

[hamhamham1] 20/3/2023 18:11

And a PE of about 13x if they made £12m profit a year.

[hamhamham1] 20/3/2023 18:10

I got a little over 30,000 of these, hopefully get to £25k in 3yrs. That would be approx 83p, or roughly £135m market cap. GLA.

[tia01] 20/3/2023 17:53

This is the fun part who right on the price. Anymore predictions.
Whatever happens we all in this together

[hamhamham1] 20/3/2023 17:29

38p open and hit 40p by 9am.
I am an optimist.

Gripfit, have you sold here in the past at a loss per chance?

[gripfit] 20/3/2023 17:17

Good news ALLWAYS get Sold or Shorted into …

[tia01] 20/3/2023 17:05

HHH1
You’ll know tomorrow whether you get these cheaper or not.
Make a prediction on opening price

[hamhamham1] 20/3/2023 16:38

Summarised, couldn't paste it all

January 2023
STAFFLINE GROUP PLC
Trading Update
&
Notice of Results

- Full Year Results marginally ahead of market expectations

- Net cash position at the year-end highlights ongoing balance sheet strength

Staffline, the recruitment and training group, provides the following trading update for the year ended 31 December 2022 ('FY 2022'), as well as the outlook for 2023 ('FY 2023').

Financial Highlights1

FY 2022
Revenue
£946.8m
+0.4%

Gross profit
£83.2m
+0.5%

Gross profit %
8.8%

Underlying operating profit2
£11.6m
+12.6%

Gross profit to operating profit conversion %
13.9%
+1.5pts

Net cash (pre IFRS 16)
£5.0m
-£1.9m

Net cash (post IFRS 16)
£0.1m
-£2.2m

· Revenue increase of 0.4% driven by new client wins, including BMW, during the year and also a full year contribution from Restart, offset by softening demand from customers who had benefited from COVID

· Gross profit from Recruitment businesses up 4.7% offsetting reduction in PeoplePlus

· Tight cost control contributed to the 1.5ppts improvement in gross profit to operating profit conversion

· Strengthened balance sheet with strong trading cashflow, despite repayment of c.£12m of COVID related government support and advance payments

· Net cash ahead of expectations

Staffline is pleased to report that trading across FY 2022 remained solid, particularly in the second half, with underlying operating profit marginally ahead, and cash flows substantially ahead of market expectations.

This positive performance has been supported by further operational progress across the Group, as highlighted by two significant recruitment customer wins, the first profit recognised from the Restart contract, and robust trading during the peak pre-Christmas period boosted by the FIFA World Cup.

The Group has pursued a policy of organic growth with a focus on cost control and working capital, conserving its cash reserves, and further strengthening its balance sheet. The post-IFRS16 net cash of £0.1m at 31 December 2022 (2021: £2.3m) is stated after repayments of the final £5.8m tranche of HMRC Deferred VAT Relief and £6.2m of COVID related advance payments to the Ministry of Justice. The substantial progress was achieved through strong trading cash generation in line with the operating profit performance, combined with tight control of working capital. At 31 December 2022, the Group continued to have significant financing headroom relative to available committed banking facilities of c.£75m. The Group is benefitting from a three-year interest rate cap taken out in Q4 2021.

Operational Update

The challenging macro-economic climate worsened as the year progressed, with higher wage inflation fuelled by tight labour markets and increasing interest rates, which were above market expectations at the start of the year. Nevertheless, all three of the Group's divisions reported operating profits.

Recruitment GB

The Group's Recruitment GB division successfully implemented a major customer win, BMW Group, whilst also generating strong organic growth in two existing customers. In addition, the division began recruiting for the travel sector as it recovered from the pandemic, although security clearance and constrained customer capacity to onboard new employees delayed any additional contribution to the FY 2022 results. Investment in headcount and technology improved customer fulfilment, despite widespread labour shortages, and expansion of the Group's branch network has helped to create a solid platform for future growth. Record results reported by Datum RPO, the Group's managed services business, underscored the trend for customers to consolidate their recruitment supply chains using an independent expert. Omega, the Group's technical and engineering recruiter, also posted strong increases in its permanent recruitment fees, which across the division were up c.80% on FY 2021, representing a c.179% increase over the last two years. The division continued to control overhead costs tightly, increasing its gross profit to operating profit conversion rate from 14.0% to 16.0%.

Recruitment Ireland

The Recruitment Ireland business is more dependent on the permanent recruitment market and less dependent upon temporary placements than our Recruitment GB business. A 45% increase in permanent recruitment fees drove Staffline's Ireland recruitment business to deliver the division's strongest results since 2019, as well as a record trading performance in the Republic of Ireland. A pivot to white-collar recruitment in the Republic of Ireland, the opening of a new office in Limerick, and the retention of key public sector contracts in Northern Ireland, all contributed to growth across 2022. The strength of permanent recruitment, and for the first time, executive search, helped increase gross margins. Additionally, tight control of the cost base resulted in the gross profit to operating profit conversion rate improving to 24.8%, up from 22.1% in the prior year.

PeoplePlus

PeoplePlus reported a solid performance in FY 2022 but was held back by lower revenues in Skills training. Strong demand for labour resulted in potential candidates bypassing additional training programmes and moving straight into employment. Conversely, these labour market conditions aided our Employability programmes which performed particularly well, and we were pleased to see PeoplePlus successfully deliver profit from the Restart sub-contracts during the year, with the division reporting its first operating profit from those contracts in the second half of 2022. Certain funding claims made by PeoplePlus for services delivered in 2020 and earlier years are now the subject of a dispute. While we are vigorously defending our position and the final outcome is uncertain, we have decided to provide £2.5m which, based on the legacy nature of the item, has been recorded through reserves.

Outlook

The Group has delivered a strong performance across FY 2022, exceeding expectations in terms of both profitability and cashflow, all the while remaining resilient despite facing a number of macroeconomic headwinds. PeoplePlus was adversely impacted by the skills and training markets, offset by a solid performance across the Group's recruitment activities, reflecting a relatively buoyant market through most of 2022 for permanent recruitment and new business.

Looking ahead, we expect the macroeconomic headwinds to persist. Low unemployment will continue to constrain volumes in PeoplePlus' Skills and Restart businesses. While we expect to grow market share in the competitive temporary labour market, the Recruitment divisions will not be immune to the broader short term market challenges, where data is showing that demand for permanent recruitment is weakening.

In the context of current expectations for the UK economy, the Board has adopted a cautious approach to FY 2023. However, the strengthened balance sheet, experienced management team and healthy pipeline, mean the Group is well placed to capitalise on the considerable market opportunities which lie ahead.

[gripfit] 20/3/2023 16:38

Hope they haven’t used their money shot up allready

[hamhamham1] 20/3/2023 16:32

They already given the rough figures

[tia01] 20/3/2023 16:26

Last chance to buy or sell before tomorrow’s judgement day.
I’m sure it could be fireworks first thing either way.
Just hope news and results are good.

[tia01] 20/3/2023 11:52

This could be a brilliant investment if they reintroduce a dividend especially. Either way we should never of been this loss

[hamhamham1] 20/3/2023 10:51

I think affirmation of the recent RNS will do just fine.
Underlying profit of nearly £12m.
Paid back the nearly £12m of gov money.
Net cash position.
Market cap of under £57m.

[tia01] 20/3/2023 10:21

Gripper Argo and QBT the place to be.

[gswredland] 20/3/2023 10:20

Yes PAGE and RWA much better results and hold up well

[gripfit] 20/3/2023 09:42

They will have to announce something out of this world… which I can’t see as they are having to pedal another load of stuff with a presentation

[tia01] 20/3/2023 09:25

Gripper
Hold fire Staffline will be ok. A lot riding on tomorrow’s news and results

[tia01] 20/3/2023 08:56

My Argo and QBT looking solid today.15% up in Argo. 🤩🤩🤩🤩

[hamhamham1] 20/3/2023 07:55

I think these are great value in the 30s and even in the 40s.
But hey, investing is an individual call.

[gripfit] 20/3/2023 07:19

There are better opportunities than this … it’s allways jam tomoro sadly

[hamhamham1] 20/3/2023 07:03

Why a massive dump?
Looking at the recent update RNS. The company is very much on top of things, returned to profit, paid down gov delayed payments due to covid, and good revenue and margins.
But hey, if you don't see value at these prices, then that's your view.