TIDMRTC
RNS Number : 1622U
RTC Group PLC
29 July 2022
This announcement contains inside information as stipulated
under The Market Abuse Regulation (EU No. 596/2014).
29 July 2022
RTC Group Plc
("RTC", "the Company" or "the Group")
Interim Results for the Six Months Ended 30 June 2022
RTC Group Plc (AIM: RTC.L), the engineering and technical
recruitment Group, is pleased to announce its unaudited results for
the six months ended 30 June 2022.
Summary:
-- Group revenue from continuing operations was GBP34.4m (2021: GBP40.5m);
-- EBITDA GBP0.1m (2021: GBP0.7m);
-- Loss before tax was GBP0.4m (2021: profit of GBP0.2m);
-- Net assets GBP6.2m (2021: GBP6.7m);
-- Net cash outflow from operating activities GBP0.6m (2021: GBP2.1m); and
-- Basic loss per share 2.43p (2021: earnings per share 0.76p).
No dividends were paid in the period (2021: Nil). At this time,
no interim dividend is proposed for the year ended 31 December 2022
(2021: Nil).
Commenting on the results, Bill Douie, Chairman, said:
"The first half of 2022 has been a difficult trading period.
Several of our trading areas have responded well to opportunities
arising from the transition from onerous pandemic conditions to an
acceptance that we are able to live with continuing COVID
outbreaks, bringing nearer to normal business conditions. In
addition, the change of routes awarded in our new long-term Network
Rail contract has brought a number of short-term but significant
challenges and costs resulting in a reduced contribution from that
element of our Group.
However, despite this and other headwinds bringing a
deteriorating global economic situation following the outbreak of
hostilities between Russia and Ukraine, our UK, international and
energy recruitment businesses all showed improving signs of growth
and The Derby Conference Centre has increased its
profitability.
This has resulted in a small positive EBITDA but a Group pre-tax
loss for the first half.
Although the second half of the year will be affected by the
emergence of 'definitely not transitory' higher levels of inflation
and increasing interest rates, we are expecting all areas of our
business that are currently performing well to continue to do so
and the rail business situation to stabilise enabling a return to a
more positive trading outcome for that period. "
The interim report is available on the Company's website
www.rtcgroupplc.co.uk .
S
Enquiries:
RTC Group Plc Tel: 0133 286 1835
Bill Douie, Chairman
Andy Pendlebury, Chief Executive
www.rtcgroupplc.co.uk
SPARK Advisory Partners Limited (Nominated Tel: 0203 368 3550
Adviser)
Matt Davis / James Keeshan
www.Sparkadvisorypartners.com
Panmure Gordon (Broker) Tel: 020 7886 2500
Hugh Rich
www.panmure . com
About RTC
RTC Group Plc is an AIM listed business that focuses on white
and blue-collar recruitment, providing temporary and permanent
labour to a broad range of industries and customers in both
domestic and international markets through its geographically
defined operating divisions.
UK division
Through its Ganymede and ATA Recruitment brands the Group
provides a wide range of recruitment services in the UK.
Ganymede specialise in recruiting technical and engineering
talent and providing complete workforce solutions to help build and
maintain infrastructure and transportation for a wide range of
clients. Ganymede is a market leader in providing a diverse range
of people solutions to the rail, energy, construction, highways,
and transportation sectors. With offices strategically located
across the country, Ganymede provides its clients with the benefit
of a national network of skilled personnel combined with local
expertise.
ATA Recruitment provide technical recruitment solutions to the
manufacturing, engineering, and technology sectors. Working as an
engineering recruitment partner supporting businesses across the
UK. ATA Recruitment has a strong track record of attracting and
recruiting engineering talent for our clients. ATA's regional
offices which are strategically located in Leicester and Leeds each
have dedicated market-experts to ensure ATA delivers excellence to
both our clients and candidates.
International division
Through its GSS brand the Group works with customers across the
globe that are focused on delivering projects in a variety of
engineering sectors. GSS has a track record of delivery in some of
the world's most hostile locations. Working closely with its
customers GSS provides contract and permanent staffing solutions on
an international basis, providing key personnel into new projects
and supporting ongoing large-scale project staffing needs. GSS
typically recruit across a range of disciplines and skills from
operators and supervisors, through to senior management level.
The Group headquarters are located at the Derby Conference
Centre which also provides office accommodation for its operating
divisions in addition to generating rental and conferencing income
from space not utilised by the Group.
Chairman's statement
Six months ended 30 June 2022
The first half of 2022 has been a difficult trading period.
Several of our trading areas have responded well to opportunities
arising from the transition from onerous pandemic conditions to an
acceptance that we are able to live with continuing COVID
outbreaks, bringing nearer to normal business conditions. In
addition, the change of routes awarded in our new long-term Network
Rail contract has brought a number of short-term but significant
challenges and costs resulting in a reduced contribution from that
element of our Group.
However, despite this and other headwinds bringing a
deteriorating global economic situation following the outbreak of
hostilities between Russia and Ukraine, our UK, international and
energy recruitment businesses all showed improving signs of growth
and The Derby Conference Centre has increased its
profitability.
This has resulted in a small positive EBITDA but a Group pre-tax
loss for the first half.
Although the second half of the year will be affected by the
emergence of 'definitely not transitory' higher levels of inflation
and increasing interest rates, we are expecting all areas of our
business that are currently performing well to continue to do so
and the rail business situation to stabilise enabling a return to a
more positive trading outcome for that period.
W J C Douie
Chairman
29 July 2022
Finance Director's statement
Six months ended 30 June 2022
Highlights
The Group delivered revenues of GBP34.4m (2021: GBP40.5m),
EBITDA GBP0.1m (2021: GBP0.7m) and a loss before tax of GBP0.4m
(2021 profit before tax: GBP0.2m) for the six months ended 30 June
2022.
T he UK Recruitment segment delivered a mixed performance H1
2022. Overall, the segment delivered reduced revenues of GBP31.1m
(2021: GBP34.2m) which was converted to significantly reduced
profit from operations of GBP0.6m (2021: 1.5m). Both permanent and
temporary UK recruitment has performed very well capitalising on
the current buoyant, albeit competitive, jobs market. Smart-meter
installation activities have also been strong with further growth
expected in H2. However, our Rail business has been severely
impacted by fuel and general price increases being seen with high
inflation coupled with the significant disruption caused by Network
Rail's decision to award all suppliers new contract delivery areas.
We are currently working with Network Rail to address these
issues.
International recruitment saw the impact of the withdrawal of
the US from Afghanistan in Q2 2021 which has resulted in reduced
revenues H1 2022 of GBP2.5m (2021: GBP6.0m) . P rofit from
operations reduced to GBP0.2m (2021: GBP0.3m).
Within UK Central Services, our hotel and conference centre
business has significantly improved from H1 2021 when it was just
providing bedroom and meeting room facilities to key workers in
line with Government guidelines and is now approaching pre-pandemic
levels. Revenue generated by the segment was GBP0.9m (2021:
GBP0.3m).
Taxation
The total tax credit for the period is estimated at GBP59,000
(2021: charge of GBP53,000). This is higher than would be expected
if the standard tax rate was applied to the result for the period,
as explained in note 3.
Earnings per share
The basic loss per share figure is 2.38p (2021: earnings per
share of 0.76p). The diluted loss per share 2.38p (2021: earnings
of 0.75p).
Dividends
No dividends were paid in the period (2021: Nil). At this time,
no interim dividend is proposed for the year ended 31 December 2022
(2021: Nil).
Statement of financial position
Net working capital has been maintained at GBP4.7m (2021:
GBP4.8m). There has been a decrease in debtors reflecting the drop
in revenues versus H1 2021 and improvement in key customer aged
balances. Net assets have reduced to GBP6.2m (2021: GBP6.7m). The
Group has no term debt and is financed using its invoice
discounting and overdraft facilities with HSBC.
Cash flow
The cash outflow from operating activities of GBP0.6m (2021:
GBP2.1m) for the six-month period reflects the absence of the
repayment in 2021 of GBP0.5m of the GBP1.5 m VAT deferred in 2020
under the Government VAT deferral Scheme and the improvement noted
above in key customer balances.
Financing
The Group's current bank facilities comprise an overdraft of
GBP50,000 and a confidential invoice discounting facility of up to
GBP12.0m with HSBC at a discount margin of 1.6% above base. The
Board closely monitors the level of facility utilisation and
availability to ensure there is enough headroom to manage current
operations and future needs of the business. The Group continues to
be focussed on cash generation and building a robust statement of
financial position to protect the business.
Own shares held
The cost of the Group's own shares purchased through the
Employee Benefit Trust is shown as a deduction from equity. No
options were exercised during the period. The balance of GBP235,918
on the own shares held reserve within equity reflects 337,027
shares remaining in the EBT that will be used to satisfy future
exercises.
Going concern
The Group's current bank facilities include a net overdraft
facility across the Group of GBP50,000 and an invoice discounting
facility with HSBC providing of up to GBP12.0m, based on a
percentage of good book debts, at a margin of 1.6% above base. The
Board closely monitors the level of facility utilisation and
availability to ensure there is enough headroom to manage current
operations and support the growth of the business.
Given the after effect of the COVID pandemic, the increases in
inflation, the cost-of-living squeeze, and impacts on the economy
of the events in Ukraine, in addition to the established budgeting
and forecasting processes, which considers a range of plausible
events and circumstances, a reverse stress test has been
undertaken. This shows that, assuming a continuation of the current
facilities, the Group has access to sufficient cash and facilities
to withstand a 30% reduction against the 2021 revenues without any
significant restructuring or other cost reduction measures.
In assessing the risks related to the continued availability of
the current facilities, the Board have taken into consideration the
existing relationship with HSBC and the strength of the security
provided, and the quality of the Group's customer base. Based on
their enquiries, the Board have determined that it remains
appropriate to conclude that sufficient facilities will continue to
remain available to the Group and that the going concern basis of
preparation remains appropriate and that no material uncertainty
exists. As a result, the going concern basis continues to be
appropriate in preparing the interim results.
S L Dye
Group Finance Director
29 July 2022
Consolidated statement of comprehensive income:
Six-month Six-month Year ended
period period 31
ended 30 ended 30 December
June 2022 June 2021 2021
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
--------------------------------------- ------- ------------ ------------ ------------
Revenue 2 34,406 40,491 77,715
Cost of sales 2 (28,852) (34,786) (65,928)
--------------------------------------- ------- ------------ ------------ ------------
Gross profit 2 5,554 5,705 11,787
Other operating income 2 - 311 351
Administrative expenses 2 (5,859) (5,776) (11,864)
--------------------------------------- ------- ------------ ------------ ------------
Profit from operations 2 (305) 240 274
Finance expense (101) (78) (160)
--------------------------------------- ------- ------------ ------------ ------------
Profit before tax (406) 162 114
Tax expense 3 59 (53) (109)
--------------------------------------- ------- ------------ ------------ ------------
Total profit and other comprehensive
income for the period attributable
to owners of the parent (347) 109 5
--------------------------------------- ------- ------------ ------------ ------------
Earnings per ordinary share 4
Basic (2.43p) 0.76p 0.04p
--------------------------------------- ------- ------------ ------------ ------------
Fully diluted (2.38p) 0.75p 0.03p
--------------------------------------- ------- ------------ ------------ ------------
Consolidated statement of changes in equity for the six months
ended 30 June 2022:
Share Share Own Capital Share Profit Total
capital premium shares redemption based and equity
held reserve payment loss
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at
1 January 2022 146 120 (236) 50 146 6,320 6,546
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Total comprehensive
income for
the period - - - - - (347) (347)
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Transactions
with owners:
Share options - - - - - -
cancelled
Share based - - - - - - -
payment charge
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Total transactions - - - - - - -
with owners
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
At 30 June
2022 (Unaudited) 146 120 (236) 50 146 5,973 6,199
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Consolidated statement of changes in equity for the six months
ended 30 June 2021:
Share Share Own Capital Share Profit Total
capital premium shares redemption based and equity
held reserve payment loss
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at
1 January 2021 146 120 (236) 50 718 6,278 7,076
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Total comprehensive
income for
the period - - - - - 109 109
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Transactions
with owners:
Share options
cancelled - - - (782) 37 (745)
Share based
payment charge - - - - 210 - 210
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Total transactions
with owners - - - (572) 37 (535)
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
At 30 June
2021 (Unaudited) 146 120 (236) 50 146 6,424 6,650
---------------------- ---------- ---------- --------- ------------- ---------- --------- ---------
Consolidated statement of changes in equity for the year ended
31 December 2021:
Share Share Own Capital Share Retained Total
capital premium shares redemption based earnings equity
held reserve payment
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------- ---------- --------- ------------- ---------- ----------- ---------
Balance at
1 January
2021 146 120 (236) 50 718 6,278 7,076
---------------------- ---------- ---------- --------- ------------- ---------- ----------- ---------
Total comprehensive
income for
the year - - - - - 5 5
---------------------- ---------- ---------- --------- ------------- ---------- ----------- ---------
Transactions
with owners:
Share options
cancelled - - - - (782) 37 (745)
Share based
payment charge - - - - 210 - 210
---------------------- ---------- ---------- --------- ------------- ---------- ----------- ---------
Total transactions
with owners - - - - (572) 37 (535)
---------------------- ---------- ---------- --------- ------------- ---------- ----------- ---------
At 31 December
2021 146 120 (236) 50 146 6,320 6,546
---------------------- ---------- ---------- --------- ------------- ---------- ----------- ---------
Consolidated statement of financial position:
As at As at As at
30 June 30 June 31 December
2022 2021 2021
Unaudited Audited
Unaudited
GBP'000 GBP'000 GBP'000
--------------------------------- ------------ ------------ --------------
Assets
Non-current
Goodwill 132 132 132
Other intangible assets 43 101 74
Property, plant, and equipment 1,574 1,602 1,554
Right of use assets 2,627 2,797 2,779
Deferred tax asset 40 30 40
---------------------------------- ------------ ------------ --------------
4,416 4,662 4,579
Current
Inventories 11 8 21
Trade and other receivables 13,610 15,084 13,481
Cash and cash equivalents 681 737 946
---------------------------------- ------------ ------------ --------------
14,302 15,829 14,448
Total assets 18,718 20,491 19,027
---------------------------------- ------------ ------------ --------------
Liabilities
Current
Trade and other payables (5,926) (8,434) (6,430)
Lease liabilities (176) (276) (294)
Corporation tax 66 (147) -
Current borrowings (3,547) (2,171) (2,828)
---------------------------------- ------------ ------------ --------------
(9,583) (11,028) (9,552)
Non-current liabilities
Lease liabilities (2,801) (2,686) (2,801)
Deferred tax liabilities (135) (127) (128)
---------------------------------- ------------ ------------ --------------
Total liabilities (12,519) (13,841) (12,481)
---------------------------------- ------------ ------------ --------------
Net assets 6,199 6,650 6,546
---------------------------------- ------------ ------------ --------------
Equity
Share capital 146 146 146
Share premium 120 120 120
Capital redemption reserve 50 50 50
Own shares held (236) (236) (236)
Share based payment reserve 146 146 146
Profit and loss account 5,973 6,424 6,320
Total equity 6,199 6,650 6,546
---------------------------------- ------------ ------------ --------------
Consolidated statement of cash flows:
Six-month Six-month Year ended
period period 31 December
ended 30 ended 30 2021
June 2022 June 2021 Audited
Unaudited Unaudited
GBP'000 GBP'000 GBP'000
Cash flows from operating activities
Profit before tax (406) 162 114
Adjustments for:
Depreciation, loss on disposal
and amortisation 413 410 816
Finance expense 101 78 160
Employee equity settled share options
charge - 210 210
Change in inventories 10 (1) (14)
Change in trade and other receivables (129) (1,680) (77)
Change in trade and other payables (504) (1,169) (3,271)
----------------------------------------- ------------ ------------ --------------
Cash outflow from operations (515) (1,990) (2,062)
Income tax paid - - (217)
Interest paid (101) (78) (160)
Net cash outflow from operating
activities (616) (2,068) (2,439)
----------------------------------------- ------------ ------------ --------------
Cash flows from investing activities
Purchases of property, plant and
equipment and intangibles (250) (120) (279)
Net cash used in investing activities (250) (120) (279)
Cash flows from financing activities
Movement on invoice discounting
facility 823 1,280 2,231
Movement on perpetual bank overdrafts (104) (76) (370)
Amounts paid to cancel share options - (848) (745)
Payments of lease liabilities (118) (258) (279)
Net cash inflow from financing
activities 601 98 837
----------------------------------------- ------------ ------------ --------------
Net decrease in cash and cash
equivalents (265) (2,090) (1,881)
----------------------------------------- ------------ ------------ --------------
Cash and cash equivalents at beginning
of period 946 2,827 2,827
----------------------------------------- ------------ ------------ --------------
Cash and cash equivalents at end
of period 681 737 946
----------------------------------------- ------------ ------------ --------------
Notes to the interim statement for the six months ended 30 June
2022:
1. Accounting policies
a) General information
RTC Group Plc is incorporated and domiciled in England and its
shares are publicly traded on AIM. The registered office address is
The Derby Conference Centre, London Road, Derby, DE24 8UX. The
company's registered number is 02558971. The principal activities
of the Group are described in note 2.
The Board consider the principal risks and uncertainties
relating to the Group for the next six months to be the same as
detailed in our last Annual Report and Accounts to 31 December
2021.
b) Basis of preparation
The unaudited interim Group financial information of RTC Group
Plc is for the six months ended 30 June 2022 and does not comprise
statutory accounts within the meaning of S.435 of the Companies Act
2006. The unaudited interim Group financial statements have been
prepared in accordance with the AIM rules and have not been
reviewed by the Group's auditors. This report should be read in
conjunction with the Group's Annual Report and Accounts for the
year ended 31 December 2021, which have been prepared in accordance
with International Accounting Standards in conformity with the
requirements of the Companies Act 2006 and with those parts of the
Companies Act 2006 applicable to companies reporting under
IFRS.
Going concern
The Group's current bank facilities include a net overdraft
facility across the Group of GBP50,000 and an invoice discounting
facility with HSBC providing of up to GBP12.0m, based on a
percentage of good book debts, at a margin of 1.6% above base. The
Board closely monitors the level of facility utilisation and
availability to ensure there is enough headroom to manage current
operations and support the growth of the business.
Given the after effect of the COVID pandemic, the increases in
inflation, the cost-of-living squeeze, and impacts on the economy
of the events in Ukraine, in addition to the established budgeting
and forecasting processes, which considers a range of plausible
events and circumstances, a reverse stress test has been
undertaken. This shows that, assuming a continuation of the current
facilities, the Group has access to sufficient cash and facilities
to withstand a 30% reduction against the 2021 revenues without any
significant restructuring or other cost reduction measures.
In assessing the risks related to the continued availability of
the current facilities, the Board have taken into consideration the
existing relationship with HSBC and the strength of the security
provided, and the quality of the Group's customer base. Based on
their enquiries, the Board have determined that it remains
appropriate to conclude that sufficient facilities will continue to
remain available to the Group and that the going concern basis of
preparation remains appropriate and that no material uncertainty
exists. As a result, the going concern basis continues to be
appropriate in preparing the interim results.
These unaudited interim Group financial statements were approved
for issue on 29 July 2022. No significant events, other than those
disclosed in this document, have occurred between 30 June 2022 and
this date.
c) Comparatives
The comparative figures for the year ended 31 December 2021 do
not constitute statutory accounts within the meaning of S.435 of
the Companies Act 2006, but they have been derived from the audited
financial statements for that year, which have been filed with the
Registrar of Companies. The report of the auditor was unqualified
and did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006 nor a reference to any matters which the auditor
drew attention by way of emphasis of matter without qualifying
their report.
d) Accounting policies
In preparing these interim financial statements, the Board have
considered the impact of new standards which will be applied in the
2022 Annual Report and Accounts and there are not expected to be
any changes in the accounting policies compared to those applied at
31 December 2021.
A full description of accounting policies is contained with our
2021 Annual Report and Accounts which is available on our
website.
This interim announcement has been prepared in accordance with
International Accounting Standards in conformity with the
requirements of the Companies Act 2006 and with those parts of the
Companies Act 2006 applicable to companies reporting under IFRS as
effective for periods beginning on or after 1 January 2022.
2. Segment analysis
The business is split into three operating segments, with
recruitment being split by geographical area. This reflects the
integrated approach to the Group's recruitment business in the UK
and independent delivery of overseas business. Three operating
segments have therefore been agreed, based on the geography of the
business unit: United Kingdom, International and Central
Services.
This is consistent with the reporting for management purposes,
with the Group organised into two reportable segments, Recruitment
and Central Services, which are strategic business units that offer
different products and services. They are managed separately
because each segment has a different purpose within the Group and
requires different technologies and marketing strategies.
Segment operating profit is the profit earned by each operating
segment defined above and is the measure reported to the Group's
Board, the Group's Chief Operating Decision Maker for performance
management and resource allocation purposes. The Group manages the
trading performance of each segment by monitoring operating
contribution and centrally manages working capital, financing, and
equity.
Revenues within the recruitment operating segment have similar
economic characteristics and share a majority of the aggregation
criteria set out in IFRS 8:12 in particular the nature of the
products and services, the type or class of customers, the country
in which the service is delivered, and the processes utilised to
deliver the services and the regulatory environment for the
services.
The purpose of the Central Services segment is to provide all
central services for the Group including the Group's head office
facilities in Derby. It also generates income from excess space at
the Derby site including rental and hotel and conferencing
facilities.
During the first half of 2022, one customer in the UK
Recruitment segment contributed 10% or more of that segment's
revenues being GBP9.3m (2021: GBP14.8m) and one customer in the
International Recruitment sector contributed 10% or more of that
segment's revenues being GBP2.4m (2021: GBP5.7m).
Revenue, gross profit, and operating profit delivery by
geography f or the six-month period ended 30 June 2022:
GBP'000 UK International UK Total Group
Recruitment Recruitment Central
Services
-------------------------------- ---------------
Revenue 31,065 2,475 866 34,406
Cost of sales (26,321) (2,135) (396) (28,852)
-------------------------------- -------------- --------------- ----------- -------------
Gross profit 4,744 340 470 5,554
Administrative expenses (3,933) (168) (1,345) (5,446)
Amortisation of intangibles (12) - - (12)
Depreciation of right of
use assets (65) - (114) (179)
Depreciation (124) (3) (95) (222)
-------------------------------- -------------- --------------- ----------- -------------
Total administrative expenses (4,134) (171) (1,554) (5,859)
-------------------------------- -------------- --------------- ----------- -------------
Profit from operations 610 169 (1,084) 305
-------------------------------- -------------- --------------- ----------- -------------
Segment profit from operations above represents the profit
earned by each segment without allocation of Group administration
costs or finance costs.
Segment information for the six months ended 30 June 2021:
GBP'000 UK International UK Total Group
Recruitment Recruitment Central
Services
-------------------------------- ---------------
Revenue 34,196 5,951 344 40,491
Cost of sales (29,220) (5,368) (198) (34,786)
-------------------------------- -------------- --------------- ----------- -------------
Gross profit 4,976 583 146 5,705
Other operating income* 213 - 98 311
Administrative expenses (3,540) (286) (1,540) (5,366)
Amortisation of intangibles (14) - - (14)
Depreciation of right of
use assets (77) - (120) (197)
Depreciation (103) (2) (94) (199)
-------------------------------- -------------- --------------- ----------- -------------
Total administrative expenses (3,521) (288) (1,656) (5,465)
-------------------------------- -------------- --------------- ----------- -------------
Profit from operations 1,455 295 (1,510) 240
-------------------------------- -------------- --------------- ----------- -------------
*Other operating income represents Government Grants in respect
of the Coronavirus Job Retention Scheme.
Segment information for the year ended 31 December 2021:
GBP'000 UK International UK Total Group
Recruitment Recruitment Central
Services
-------------------------------- --------------- -------------
Revenue 66,842 1,279 9,594 77,715
Cost of sales (56,703) (622) (8,603) (65,928)
-------------------------------- -------------- --------------- ----------- -------------
Gross profit 10,139 657 991 11,787
Other operating income* 213 138 - 351
Administrative expenses (7,240) (3,293) (519) (11,052)
Amortisation of intangibles (100) - - (100)
Depreciation of right of
use assets (129) (239) - (368)
Depreciation (175) (165) (4) (344)
-------------------------------- -------------- --------------- ----------- -------------
Total administrative expenses (7,431) (3,559) (523) (11,513)
-------------------------------- -------------- --------------- ----------- -------------
Profit from operations 2,708 (2,902) 468 274
-------------------------------- -------------- --------------- ----------- -------------
*Other operating income represents Government Grants in respect
of the Coronavirus Job Retention Scheme.
Recruitment revenues are generated from permanent and temporary
recruitment and long-term contracts for labour supply. Within
Central Services revenues are generated from the rental of excess
space and hotel and conferencing at the Derby site, described as
Other below. Revenue and gross profit by service classification for
management purposes:
Revenue Six months Six months Year ended
ended 30 ended 30 31
June 2022 June 2021
(Unaudited) (Unaudited)
December
2021
GBP'000 (Audited)
Permanent placements 1,414 964 2,098
Contract 32,126 39,183 74,338
Other 866 344 1,279
----------------------- -------------- -------------- ------------
34,406 40,491 77,715
----------------------- -------------- -------------- ------------
Gross profit Six months Six months Year ended
ended 30 ended 30 31 December
June 2022 June 2021
(Unaudited) (Unaudited)
2021
(Audited)
GBP'000
----------------------- -------------- -------------- --------------
Permanent placements 1,414 964 2,098
Contract 3,670 4,595 9,032
Other 470 146 657
----------------------- -------------- -------------- --------------
5,554 5,705 11,787
----------------------- -------------- -------------- --------------
3. Income tax
Six-month Six-month Year ended
period period 31
ended 30
June 2022
(Unaudited)
ended 30 December
June 2021 2021
(Unaudited)
Continuing operations (Audited)
---------------------------------------- -------------- --------------- ------------
GBP'000 GBP'000 GBP'000
---------------------------------------- -------------- --------------- ------------
Analysis of tax:
Current tax
UK corporation tax (66) (71) (6)
Adjustment in respect of previous -
period - -
---------------------------------------- -------------- --------------- ------------
(66) (71) (6)
Deferred tax
Origination and reversal of temporary
differences 7 124 115
Tax (59) 53 109
---------------------------------------- -------------- --------------- ------------
Factors affecting the tax expense
The tax assessed for the six-month period ended 30 June 2022 is
higher than (2021: higher than) would be expected by multiplying
profit by the standard rate of corporation tax in the UK of 19%
(2021: 19%).
The differences are explained below:
Six-month Six-month Year ended
period ended period ended 31 December
30 June 2022 30 June 2021
Unaudited 2021 Unaudited Audited
------------------------------------ --------------- ----------------- --------------
Factors affecting tax expense GBP'000 GBP'000 GBP'000
------------------------------------ --------------- ----------------- --------------
Result for the period before
tax (406) 162 114
------------------------------------ --------------- ----------------- --------------
Profit multiplied by standard
rate of tax of 19% (2021: 19%) (77) 31 22
Non-deductible expenses 18 22 68
Tax credit on exercise of options - - 28
Effect of change in deferred
tax rate - - (9)
Tax charge for the period (59) 53 109
------------------------------------ --------------- ----------------- --------------
4. Earnings per share
The calculation of basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year.
The calculation of diluted earnings per share is based on the
basic earnings per share adjusted to allow for all dilutive
potential ordinary shares.
Basic Diluted
Six-month Six-month Six-month Six-month
period ended period ended period ended period ended
30 June 2022 30 June 2021 30 June 2022 30 June
2021
Unaudited Unaudited Unaudited Unaudited
--------------- ---------------
Earnings GBP'000 (347) 109 (347) 109
-------------------- --------------- --------------- --------------- ---------------
Basic weighted
average number
of shares 14,306,680 14,266,680 14,306,680 14,266,680
-------------------- --------------- --------------- --------------- ---------------
Dilutive effect
of share options - - 266,885 301,859
-------------------- --------------- --------------- --------------- ---------------
Fully diluted
weighted average
number of shares - - 14,573,565 14,568,539
-------------------- --------------- --------------- --------------- ---------------
Earnings per
share (pence) (2.43p) 0.76p (2.38p) 0.75p
-------------------- --------------- --------------- --------------- ---------------
5. Borrowings
Included in current borrowings are bank overdrafts and an
invoice discounting facility which is secured by a cross guarantee
and debenture over all Group companies. There have been no defaults
or breaches of the terms of the facility during the current or
prior period.
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END
IR BLGDRRUDDGDI
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