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Networkers International plc Pleased With Progress

Networkers International plc Pleased With Progress

Networkers International ("Networkers" or the "Group"), the AIM quoted technical and professional staffing company, today issues a trading update in respect of the six months ended 30 June 2013 ("the period" ).

The Group has performed in line with management expectations with Net Fee Income (gross margin) for the six-month period expected to reduce by approximately 8% against a strong comparative period last year. The group has reduced overheads to offset the majority of this reduction. Staff numbers have remained broadly unchanged throughout the period and are at similar levels to the corresponding period last year.

Cash generation has been strong with net debt, which relates entirely to invoice discounting, expected to reduce by &pound1.0m since the year end to approximately &pound6.0m. This is after making own share purchases of &pound0.33m, acquiring shares of minority interests of &pound0.31m and making dividend payments of &pound0.54m.

During the period, the Group has made excellent progress in improving and diversifying its sales mix with over 25% (2012: 20%) of Net Fee Income now being derived from permanent placements. The Group's Energy & Engineering division has performed especially well, increasing its share of Net Fee Income to 11% (2012: 6%).

The Group expects to announce an increase of 16.6% on the interim dividend to 0.70p per share (2012 interim dividend 0.60p per share) when it reports its interim results on 19 September 2013.

Networkers continues to implement its strategy of investing in specialist areas within its key staffing sectors of telecommunications, IT and Energy & Engineering with a particular emphasis in emerging markets.

Commenting on today's announcement, Spencer Manuel, CEO said "As detailed in our Final Results, we began 2013 with a lower starting position in terms of contractor numbers compared to 2012 but with the belief that there was opportunity to grow throughout the current year. This still remains the case and should place us in a stronger position as the year progresses and our comparative numbers become less challenging.

Overall, I am pleased with the progress made during the period, particularly in increasing our permanent placement revenue stream which now accounts for over 25% of our Net Fee Income. The overall telecoms market remains unchanged from when we reported back in April. However, when market conditions in this sector do pick up, we believe we are very well placed to benefit from the increased demand that 4G will create. Whilst, understandably, our telecoms contractor numbers are down on last year, they have plateaued out in recent months and I am pleased to report that strength in our specialist IT and Energy & Engineering divisions means that at this stage we remain on target to meet management expectations.

The Company expects to announce its interim results on 19 September 2013.


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