Harvey Nash Trading Update
Harvey Nash has issued its Interim Management Statement covering the period from 1 August 2008 to 27 November 2008.
Revenue was up 34% and profit before taxation increased by 23% in the three months ended 31 October 2008 compared to the previous year. All three of the Group's main geographic areas, USA, UK & Ireland and mainland Europe increased revenues in the quarter compared to the same period last year.
The Group announced, on 11 November 2008, a 54m IT outsourcing contract with Alcatel-Lucent AG over an initial period to 31 December 2010 in line with its stated growth strategy of organic investment, new contract wins and bolt on acquisitions.
The Group's balance sheet, substantially strengthened following the early repayment of all long term debt in the previous year, continues to benefit from the cash generative nature of the Group's services. We are pleased to report that trading cash flow for the quarter is well ahead of budget and the Group's financial position at 31 October 2008 improved again compared to budget and last year.
The Group's portfolio of services continues to underpin the strength of the business. While demand for permanent staff has been affected by the global financial crisis, the Group is continuing to see increased demand for its IT outsourcing and offshore services. The gross profit attributable to contractor, outsourcing and offshoring services is longer term in nature with increased visibility. For the first nine months of the year it comprised 59% of total gross profit. We expect the proportion to increase to over 60% in the final quarter.
The current market conditions provide the Group with excellent opportunities to grow our blue-chip global client base and leverage the Group's success in the outsourcing and off-shoring market. Accordingly, the Board remains confident of further progress for the year ended 31 January 2009.