Spring Stays Satisfied
Spring Group plc has issued an Interim Management Statement for the third quarter of 2008.
Following a strong first half of the year in which we reported a 52% increase in profit before tax, our third quarter has seen further growth in headline revenues, net fee income and operating profit compared to the same period in 2007.
As with many of our peers, the recent global economic volatility has caused a softening of some of our markets, during what is traditionally the strongest quarter of our year, particularly in financial services where customers are experiencing obvious medium-term challenges.
Given this current global economic uncertainty, we are taking necessary steps to reduce our cost base. This will deliver a material headcount saving this year, which, though incurring a one off cost in 2008, will provide ongoing financial benefits in 2009 when we will realise a full year's savings to our income statement.
In our general staffing business we have completed our planned office-opening programme. Due to the economic climate however we now expect to see these offices go into profit in 2009 rather than in the current financial year. In line with our strategy to extend our global footprint we have opened a further 7 professional services offices overseas, and these operations are performing in line with expectations. In addition we are pleased to announce some recent RPO wins that will have associated set-up costs in the current year but will contribute to future turnover and profitability.
Peter Searle, CEO, said: "Whilst we are satisfied with the performance of the Group so far this year, we are in very uncertain economic times. Accordingly, we have taken a number of measures to enable us to maintain our profitability into 2009. With our strong balance sheet and with traditionally 80% of our business from contract revenues, we believe that Spring is well positioned to weather the current uncertainty."