PBT up 33% at year-end 2019 for Cpl
Cpl Resources Plc ('Cpl', the 'Group' or the 'Company') has released its results for the year ended 30th June 2019.
Revenue grew by €42.2m to €564.9m, up 8% on the prior year. Group gross profit grew by 16% to €96,258m and profit before tax grew by 33% to €24,584m in the year. The global demand for flexible workforce solutions continues and its Flexible Talent fee income grew by 21% during the year.
Operating profit margin was 4.4% (2018: 3.4%). Adjusted for non-cash charges relating to the Group's Long-Term Incentive Plan (LTIP) and currency translation, the operating margin increased by 80 basis points to 4.6% in the financial year.
At year end, the Group had a strong balance sheet, with net assets of €110.4m, up from €92.5m in the prior year. Cpl ended the year with net cash of €40.1m, up €15.9m from the prior year, after funding the working capital demands of its Flexible Talent division.
John Hennessy, chairman, commented, "I am very pleased to report exceptionally strong earnings growth for the Group for the year ended 30 June 2019, reflecting a strong performance across all of our business. This result highlights our clear focus on continuing to grow the business, while evolving our offering to meet shifting market demands and continuing to manage our cost base to improve margins.
“At its heart Cpl is a people business and our culture is one of openness, respect and clear communication. We believe that this culture and the calibre of our people enables us to deliver consistently outstanding service to our clients and candidates, and that it has contributed significantly to an excellent performance across the business in the past year."
Anne Heraty, CEO, added, "Cpl has delivered another year of exceptional earnings growth and strong cash conversion, while increasing our net fee income by 16% and our profit before tax by 33%.
“We continue to embrace a global demand for workforce solutions and our business model has evolved and adapted in response. Our managed solutions division is experiencing strong, consistent growth and we have recently branded this division Covalen, clearly defining our value proposition and positioning ourselves for future growth both domestically and internationally."
In October 2018, Elaine Coughlan was appointed to the board as an independent non-executive director. Coughlan is a highly regarded technology investor and has extensive experience in scaling technology companies worldwide.
In January 2019, Oliver Tattan retired from the board having been a non-executive director of the Group since 2007.
As part of the ongoing process of refreshing the board and as previously indicated, Breffni Byrne will retire from the board during the current financial year ending 30th June 2020. The company intends to appoint an additional, independent non-executive director and will begin a process to identify suitable candidates. A further update will be provided in due course.
Mark Buckley will leave the group and will step down from the board on 30th September 2019. Buckley joined Cpl in 2013 as chief financial officer and since then has been appointed to the board and to the executive positions of chief operations officer and deputy chief executive.
The Group had a net cash balance of €40.1m as at 30th June 2019 (2018: €24.2m). In the twelve months to 30th June 2019, €27.1m was generated in cash flow from operating activities before tax and changes in working capital (2018: €20.6m). Although the growth in its Flexible Talent business requires significant investment in working capital, it recorded a strong net cash inflow of €15.9m in the year (2018: €15.7m (excluding impact of tender offer)), demonstrating the profitable, cash generative nature of our business and the effectiveness of our working capital management.
Cpl has delivered earnings per share in the twelve months to 30th June 2019 of 77.3 cent, a 37% increase on the prior year, reflecting the growth in profitability in the year. The board is recommending a final dividend of 11.0 cent per share. This will bring the total dividend for the year to 19.0 cent per share. The dividend, if approved by the shareholders, will be payable on 4th November 2019 to shareholders on the Company's register at the close of business on the record date of 11th October 2019.
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