CPL Resources announce results for the half year ended 31 December 2014
I am pleased to report that in the six months to 31 December 2014 the Group delivered a growth in revenues and gross profit. We have also made significant investment in our operations during the period.
§ 5% increase in revenue to &euro193.2 million
§ 5% increase in gross profit to &euro28.2 million
§ 13% decrease in operating profit and earnings per share as we invest in operations
§ Interim dividend unchanged at 4.75 cent per share
Half Year Highlights
6 months ended
6 months ended
31 December 2014
31 December 2013
Profit before tax
Earnings per share
Dividend per share
Profit before tax
Permanent gross profit
Temporary gross profit
Permanent gross profit as % of the total gross profit
Temporary gross profit as % of the total gross profit
* as % of gross profit.
During the six months to 31 December 2014 the Group delivered growth across the business, resulting in revenues of &euro193.2 million for the half year. Our gross profit grew by 5% against the same period last year to &euro28.2m. The Group's operating profit of &euro6.0 million for the six months to 31 December 2014 is 13% lower than the same period last year. Profit before tax decreased by &euro0.9 million to &euro6.1 million as the Group invested in its operations during the period. The Group delivered earnings per share of 17.2 cent for the six months to 31 December 2014.
We have made significant investment in our people, operations, infrastructure and facilities, and much of the associated cost has been charged against profits. As a consequence, our conversion rate of gross profit to operating profit has fallen to 21.1%, from 25.4% in the same period last year.
We are experiencing gradual improvements in market conditions, although significant pricing challenges and economic headwinds are being experienced in a number of sectors and locations. The Cpl team has continued to work closely with our clients to understand their specific requirements and with our candidates in order to match their skills to those client requirements. As a result our gross profit generated from permanent placements in the six months to 31 December 2014 was &euro11.2 million, an increase of 11%. Permanent fees generated outside of Ireland represented 42% of total permanent fees in the period.
In the six months to 31 December 2014 revenue generated from temporary assignments was &euro182.0 million, representing 5% growth over same period last year. The gross profit on these fees was &euro17.1 million, 1% higher than the six months to 31 December 2013.
Margin pressure continues across the temporary staffing market and this market segment remains highly competitive. We have an average number of people placed with our clients of 11,079 for the period ended 31 December 2014.
We continue to employ talented and energetic people within the Group. On behalf of the Board I wish to express my gratitude for the continuing hard work and dedication of our people and for their commitment to the Group.
The Group has a cash balance of &euro24.2 million as at 31 December 2014. In the six months to 31 December 2014 &euro6.3 million was generated in cash flow from operating activities before changes in working capital. Our temporary business requires significant investments in working capital and this, together with our investments in our operations, has given rise to a net cash outflow from cash and cash equivalents of &euro6.3 million in the period.
The Board has decided that the Company will pay an interim dividend of 4.75 cent per share. The dividend will be payable on 6th March 2015 to shareholders on the company's register at the close of business on the record date of 6th February 2015. The Group has a progressive dividend policy which reflects underlying earnings growth and the continued strength of the Group's balance sheet.
In the six month period to 31 December 2014 we have increased significantly our investment in the Group's operations. We have done so in order to be well positioned to take advantage of expected improvements in our key markets. Although we still face challenges in several markets and sectors arising from economic uncertainty and continuing competitive and client pressures, our strong financial position will provide us with the resources to capitalise on growth opportunities as they arise. While the pace of recovery remains uncertain in many markets, we expect the remainder of the financial year to show profitable growth on the previous six months for the Group.