Pinnacle Makes 5.6M pre-tax Loss
Pinnacle Staffing Group plc, the healthcare recruitment group announces its half year results for the period ending 4 July 2010.
Turnover from continuing operations was 4million (2009: 1.7million)
Loss from continuing operations of 808,000 (2009: 929,000)
Pre-tax loss of 5,688,000 (2009: 137,000)
Agency Nursing and Medical Services Businesses were sold after the period end and are treated as discontinued operations
Focus on growing the Doctors recruitment businesses
Company now cash positive with no bank borrowings
The first half of the year has been devoted to searching for a buyer for the Company at a time of deteriorating financial performance. In the time available, no offer for the Company which could be put to shareholders was forthcoming. Subsequently the Board decided to sell the Agency Nursing and Medical Services businesses to Arabella Health Staffing Limited for 2.75 million. The disposal was completed on 6th September 2010 and the sale proceeds were used towards repaying the invoice discounting facility and reducing the outstanding current liabilities. The Company still owns the sales ledger relating to work done by the sold businesses up to the date of completion and good progress is being made in collecting the amounts outstanding. As of 17th September 2010 the Company held net cash of approximately 500k.
The Agency Nursing and Medical Services Businesses are being treated in these accounts as discontinued businesses. Generally their performance was unsatisfactory in the period although several of the British Nursing Association ("BNA") branches did report significant improvements in the commission they generated. Since the beginning of April 2010, corresponding to the start of the new financial year for NHS organisations, the market background has become more difficult with shifts being booked with substantially reduced advance notice. This impacted on BNA's ability to fill the shifts being offered with its available workers. Regional NHS budget restrictions resulted in poor performances by the Company's specialist nursing brands, Mayfair and Grosvenor and also by the Medic International allied health professionals business .
The discontinued businesses made a loss of 0.2million before an impairment charge relating to goodwill of 3.2million and a provision for onerous contracts of 1.5million.
In the continuing businesses, Doctors recruitment which trades as Medic International and Holt Doctors saw a 14% rise in turnover from the six month period ended 3 January 2010 and this business continues to grow steadily. International Nursing Permanent Placements made a small positive contribution.
The doctors businesses are maintaining a steady growth rate and are currently planning the next stage of their expansion. We will look for suitable bolt-on opportunities for both the doctors businesses and our compliance monitoring activities.
There remains much to be done to minimise the ongoing commitments and obligations relating to the discontinued businesses however this will be a key focus over the next few months as we seek to maintain the value within the Company.