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Matchtech Group NFI up 62% YoY

Matchtech Group has released its H1 interim results for the six months ended 31st January 2016, confirming £297.9m in revenue, an increase of 35% YoY from H1 2015’s revenue of £220.2m and net fee income (NFI) of 36.5m, up 62% YoY from H1 2015’s NFI of £22.5m.

 

The engineering and technology specialist attributed its financial growth to the positive engineering and telecoms market, though offset by some weakness in technology, and the Group’s acquisition of Networkers, last April.

 

Contract NFI totalled £26.6m in H1 2016, up 63% from £16.3m in H1 2015. Permanent recruitment fees were declared as £9.9m, up 60% from £6.2m in H1 2015. The split between contract and permanent NFI remained largely unchanged at 73/27 contract to perm respectively, in H1 2016 and 72/28 in H1 2015.

 

Profit from operations was £7.0m (2015 H1: £5.3m). Underlying profit from operations was £10.1m (2015 H1: £9.9m). NFI conversion was 20% (2015 H1: 24%), with underlying NFI conversion 28% (2015 H1:27%). The group states that interest costs remain relatively low at £0.1m (2015 H1: £0.2m). H1 2015 included a profit on the revaluation of foreign assets of £0.6m. Profit before tax was up 35% to £6.9m (2015 H1: £5.1m) with underlying profit before tax up 3% to £9.4m (2015 H1: £9.1m). 

 

Basic earnings per share were up 2% to 15.4p (2015 H1: 15.1p) with underlying basic earnings per share up 6% to 21.9p (2015 H1: 20.6p). Diluted earnings per share were up 5% to 14.8p (2015 H1: 14.1p) with underlying diluted earnings per share up 7% to 20.9p (2015 H1: 19.6p).

 

The Group announced that trading performance in line with management expectations, while the integration of Networkers is on track, due to be largely completed by 31st July 2016. It stated it is on course to achieve synergy targets fully in the year to 31 July 2017, adding that investments in connectivity and business development have been implemented. The Group added it is also focussed on new IT market segmentation with a clear specialist focus.

 

The Group also confirmed that Anton Roe has been appointed as regional managing director for the Americas and Denise McAnulty has been appointed regional managign director for Asia.

 

Brian Wilkinson, chief executive officer, said, “The Group today announces another solid set of results, reflecting the continuing strategic and operational progress we are making. The acquisition of the Networkers business in April 2015 has enabled the Group to deliver a 62% increase in NFI for the period. Cost synergies are being realised as planned, with more to come in the second half-year.

 

“Performance in the first half of FY 2016 is in line with management’s expectations, with NFI growth in Engineering of 7% and Telecoms of 11% compared to the second half of last year. IT declined 20% against 2015 H1, improving to a 9% decline against 2015 H2, and management actions are in hand to deliver an improved performance, with a new IT market segmentation implemented post period end giving clear niche specialist focus in attractive markets where we have high levels of capability.

 

“Demand for skilled engineers remains strong in the UK. Having identified a number of opportunities to roll out our Engineering recruitment services internationally, we have taken the first practical steps to realise sales synergies through our new overseas network, with some encouraging initial results.  Investment in headcount is continuing in these areas as we aim to build market share and I remain confident that we will convert these exciting opportunities into significant growth over the next few years.”

 

 

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