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Cpl sees adjusted PBT rise 24% in H1 20219

Cpl Resources Plc has released its results for the half year ended 31st December 2019.

The company’s revenue for the six months to 31st December 2019 increased by 5% to €291.4m and its gross profit increased to €51.1m, up 10% on the same period in 2018. The group's adjusted profit before tax (excluding non-cash foreign currency translation and LTIP charges) was €14.2m for the six months to 31st December 2019, an increase of 24% on the prior period.  Cpl’s conversion rate of gross profit to adjusted profit before tax was 27.8% in the period (2018: 24.7%).  This increase was driven in part by the strong performance in permanent recruitment, but also by management’s focus on controlling costs, improving margins and increasing recruiter productivity. In addition, key margin improvements achieved in the period include a gross margin increase to 17.5% (2018: 16.7%) and an adjusted operating margin increase to 4.9% (2018: 4.2%).

Growth in the period was all organic with both divisional segments reporting an increase of 10% in net fee income.  The permanent division has benefited from favourable economic conditions in its key markets and, in particular, from strong growth in the technology and UK healthcare sectors. The flexible talent division continues to grow as it responds to an increasing demand globally for more flexible workforce solutions.  Covalen, Cpl’s recently launched managed solutions brand, is a key contributor to the growth of this division.

The group delivered a 23% increase in earnings per share to 42.9 cent for the first half of the financial year, and the board has approved an interim dividend of 10.0 cent per share, up 25% on the prior period.

John Hennessy, chairman, commented, “I am pleased to report that in the six months to 31 December 2019, the Group delivered another set of strong results with double digit earnings growth and improved margin performance.

“Whilst we remain conscious of the impact political, regulatory and economic events globally can have on our business, we now expect profit before tax for the full year to be ahead of current market expectations.”

Anne Heraty, CEO, added, “It has been another period of very robust growth for Cpl as the Group delivered a 10% increase in net fee income and a 23% increase in earnings. During the six-month period we made additional investment in products focused on innovative technology solutions, adding further value for our clients.

“We continue to see increasing client demand for solution oriented and flexible workforce models. With our recent investments in the “Future of Work Institute” initiative and our managed solutions division ‘Covalen’, we believe that Cpl is well positioned to deepen our client relationships further, both domestically and internationally.”

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