UK revenue up over 14% at year-end 2017 for Prime People
Prime People Plc has released its audited results for the year ended 31st March 2017.
Revenue for the year was £24.21m (2016: £20.76m). NFI was £13.10m, a 6.68% increase on last year (2016: £12.28m). NFI in the second half of the year of £6.77m was 7.00% higher than the first half of 2017.
There was a reduction in operating profit for the year from £2.15m in 2016 to £1.90m in 2017. In the UK, the company’s core business in property was particularly affected in quarters one and two by the considerable negative sentiment for the sector surrounding the uncertainties of the EU referendum. Its prime energy business, servicing the renewable market in the UK suffered difficulty following the change in government subsidy for the sector. The Group supported the team to refocus on expanding its reach in new territories. There were also costs associated with conserving talent and, whilst total headcount increase was limited, there was investment in staff to support future productivity across the Group.
The conversion rate, which compares operating profit to NFI, decreased from 17.50% to 14.54% which is in line with the costs mentioned above. During the year NFI productivity per head rose to £102.33k (2016: £99.03k). The ratio of NFI derived from contract as against permanent placements has slightly increased in the year from 9:91 in 2016 to 10:90, as a result of increase in the contract team size.
In the UK, revenue increased by 14.22% to £18.56m (2016: £16.25m) with a decrease in NFI of 4.25% to £7.44m (2016: £7.77m). Contract represented 17.36% (2016: 14.52%) of total UK NFI in 2017 while permanent NFI declined by 9.84%
NFI for the region was flat largely as a consequence of the lack of performance in quarters one and two of its property business, affected by referendum uncertainty. As mentioned in the Chairman's Report, there were difficulties for the prime energy team as a result of the change in government policy which gave rise to material costs involved in the refocusing of the team.
Additionally, the company suffered staff turnover in our Manchester office causing revenue delay and profit impact. Its contract, residential and real estate banking & investment teams delivered strong NFI growth during the year and performed in line with profit expectations.
Asia NFI grew by 39.94% to £5.08m (2016: £3.63m).The region is covered by its offices in Hong Kong and Singapore and represents 38.78% of Group NFI (2016: 29.56 %).
Both Asia teams benefited from increased productivity and maturing business lines. In 2017, it expanded its prime insight team in Singapore which offers our clients broader service range and better ability to serve markets in mainland China and the region.
In the rest of the world region, covered by offices in Dubai and South Africa, there was a small profit this year, with NFI declining and a conversion rate of 8.62%, the outlook for the regions in the new financial year looks stable and are expected to be profitable.
Peter Moore, managing director of Prime People, said, "I am pleased to report a good set of results with Gross Fee Income up 16.67% and Net Fee Income up 6.68%.
“Operating profit for the year was £1.90m, slightly down on £2.15m in 2016, reflecting increases in staff costs associated with conserving talent and investing to nurture future productivity across the Group. There were a number of good performances within UK property, in particular, contract and residential teams generated improved NFI. Our Asia business, particularly Singapore, continued to develop strongly.
“We have maintained a strong cash position and propose a final dividend of 3.25p, which combined with the interim dividend of 1.75p per share, will result in a total dividend of 5.00p for the 2017 financial year. (2016: 8.84p - which included a special interim dividend of 4.00p and second interim dividend of 3.09p)
“Current activity is encouraging across the group and we are confident the business is well positioned to exploit opportunities as they arise."
The annual general meeting will be held on Monday 24th July 2017 at 11.00am at 2 Harewood Place, London, W1S 1BX. All shareholders are encouraged to attend. The Notice of AGM will be posted to shareholders today and will be made available on the Company website: http://www.prime-people.co.uk/ .
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