RTC Group profit up 27%
A resolution regarding this recommended final dividend is to be considered at the Company's forthcoming 2015 Annual General Meeting, which is due to be held on 22 April 2015. If shareholders approve the recommended final dividend, then this will be paid on 24 April 2015 to all holders of shares who are on the register of members at the close of business on 27 March 2015, with an ex-dividend date of 26 March 2015.
Commenting on the results Andy Pendlebury, CEO, said, "I am extremely proud of the progress the Group has made during 2014. We have continued to grow underlying profit and shareholder value ahead of much of our competition, as can be seen from our profit and earnings per share progression and each of our core recruitment businesses are well positioned to capitalise on the growth which is anticipated across all our respective markets.
"We have now established an extremely dynamic and innovative culture across the Group and we believe that this, coupled with giving all of our businesses the freedom they need to compete in highly dynamic markets will ensure we continue to attract the brightest and most ambitious people, which is vital as we pursue our future growth plans.
"Finally, our continued success is a direct result of the hard work, support and unparalleled commitment of everybody employed in our business and the Group Board is extremely proud of our collective achievement."
For the year ended 31 December 2014
I am pleased to present the final report for the year to 31st December 2014.
2014 has again been a year of growth both in turnover and profit. As a result, although turnover growth was modest at £51m, representing an increase of 4% over 2013, we have achieved Group operating profits of £1.11m and a Group pre-tax profit of £1.02m, increases of 27% and 38% respectively versus the previous year. This is a clear indication of major increases in efficiency coupled with reductions in interest charges arising from more effective credit control.
Net cash from operating activities 'free-cash' has markedly increased partly as a result of increased profitability and partly arising from improvements in terms of trade, particularly in debtor days. In pursuance of Group strategy we have recommenced the payment of dividends and have made an acquisition for a cash consideration of £891,000.
Our enhanced trading performance has enabled us to continue carefully focused increases in capital expenditure with a particular emphasis on improvements in IT.
On 28th November we completed the purchase of RIG Energy Limited, a provider of contract and permanent gas engineers, extending and diversifying the range of safety critical clients served by Ganymede. RIG Energy has now been successfully integrated into Ganymede and has been rebranded Ganymede Energy. It achieved operating profits in the year to 31st December 2014 of £218,000 of which £43,000 were in December and are included in RTC Group's consolidated results for 2014.
As stated in my report for the year to December 2013, we have established a policy of paying dividends to shareholders from free cash flow. In pursuance of this objective, during the year, the share premium account has been cancelled and the reserve transferred to the profit and loss account in accordance with approval given at our last Annual General Meeting. Your Directors are satisfied that profitability, free cash flow and shareholder equity are now sufficiently robust to permit a modest return to the dividend list . During the year the Company paid a 2014 interim dividend of £67,558 (2013: £Nil) to its shareholders, which represented a payment of 0.5p per share (2013: Nil). Your Directors have now recommended a further final dividend of £135,116 (1p per share), making a total of 1.5p per share for the year ended 31 December 2014 (2013: £Nil). A resolution regarding this recommended final dividend is to be considered at the Company's forthcoming 2015 Annual General Meeting, which is due to be held on 22 April 2015. If shareholders approve the recommended final dividend, then this will be paid on 24 April 2015 to all holders of shares who are on the register of members at the close of business on 27 March 2015, with an ex-dividend date of 26 March 2015.
The Group Board
During the year, John White wished to pursue other business interests and consequently resigned his position as a director. I would like to thank John for his strong support during difficult times.
We have been fortunate in securing the services of Tim Jackson as a Non-Executive director. Tim has particularly relevant experience in recruitment as past finance director of Staffline Group Plc in a period of fast growth both organically and by acquisition. In addition to his role as non-executive director, Tim is a member of the remuneration and audit committees and provides help and advice in the identification and evaluation of potential acquisitions.
In addition to the use of free cash flow to finance an acquisition and return to the payment of dividends working capital improvements in ATA have permitted a significant investment in additional consultants.
As previously announced, Ganymede has been successful in achieving a further and significantly enhanced award as a result of the Network Rail CP5 procurement process. Ganymede will enter into a Contract with Network Rail to provide contingent labour services including the supply of safety critical, track and E&P (electrification and plant) resources in the West, South West and North East England, the Midlands and Wales. The Contract will run for a period of five years from April 2015 and has an estimated order book value of between £80m to £100m. Following this Contract, Ganymede will be one of Network Rail's largest suppliers of contingent labour to their maintenance and renewals programme. The outlook for other Ganymede rail business is promising and Ganymede Energy has made a strong start and is expected to perform well in 2015.
GSS continues to support NATO operations in Afghanistan through its contract with Kellogg Brown and Root (KBR) and whilst, as anticipated, the number of personnel is reducing, the withdrawal will be more gradual than originally anticipated and our support will continue into 2015 and possibly 2016. The business is also securing new contracts with KBR in other regions and is in discussions with a range of clients to provide work force solutions on a range of non-military opportunities.
The Derby Conference Centre (DCC) continues to provide our prestigious Head Office location and is making steady profits providing facilities for us and other business users.
Although the global situation must continue to cause some apprehension, the UK economy continues to perform surprisingly well and we are confident that 2015 will see further growth.