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Prime People PLC   -  PRP   

Half-year Report

Released 07:00 14-Nov-2019

RNS Number : 3296T
Prime People PLC
14 November 2019
 

 

 

 

 

 

14 November 2019

 

 

Prime People Plc

 

Interim Results

 

Prime People Plc ("Prime People" or the "Group"), the global specialist recruitment business for professional and technical staff working in the Real Estate & Built Environment, Energy & Environmental and Technology, Digital & Data Analytics sectors, announces its unaudited interim results for the six months ended 30 September 2019.

 

CHAIRMAN'S STATEMENT

 

Overview

 

I am pleased to report the results for Prime People Plc for the half-year ended 30 September 2019.

 

The Group recorded a profit before tax for the period of £1.73m (H1 2019: £1.59m) on revenue of £13.17m

(H1 2019: £12.57m).

 

Financial Results

 

Group revenue of £13.17m was 4.72% higher than the same period last year (H1 2019: £12.57m).

 

Group Net Fee Income ("NFI") was £8.80m (H1 2019: £7.99m). Our overseas business showed strong performance, with NFI for Asia increasing to £4.83m (H1 2019: £3.87m) and contributing 57.90% of Group permanent NFI (H1 2019: 52.16%). NFI recorded during the period by our Hong Kong subsidiary, Command Recruitment Group (HK) Ltd ("CMD"), was £2.28m (H1 2019: £1.68m), detailed in Note 3(a) within the NFI for the Group's Asia regional performance. NFI for the UK business was £3.71m (H1 2019: £3.86m) and Rest of World was £0.26m (H1 2019: £0.27m).

 

Contract NFI represented 5.17% of Group NFI against 7.21% in H1 2019.

 

Administrative costs for the Group were £7.07m (H1 2019: £6.40m) during the period which included planned expenditure for enhancing technology to drive efficiencies across our business, greater advertising spend, and higher professional costs associated with our continued focus on organic growth.

 

In the UK, profit before tax was £0.48m against £0.62m in H1 2019. Our Asia business, which covers the Group activities in Hong Kong and Singapore, generated a profit before tax before adjustment for minority interest of £1.24m for the period (H1 2019: £0.95m), of which £0.84m related to CMD (H1 2019: £0.58m).

 

Our newly established business in Germany, disclosed under Rest of the World, reported a small profit and is indicating good opportunities for growth.

 

 

The charge for Group taxation of £0.31m (H1 2019: £0.10m) is based on the expected annual effective tax rate of 19% in UK (H1 2019: 19%), 16.5% in Hong Kong (H1 2019: 16.50%), and 17% in Singapore (H1 2019: 17%).

 

Basic earnings per share for the period were 9.33p (H1 2019: 10.95p).

 

Cash Flow

The Group continues to maintain a strong net cash position. At the start of the current financial year, the Group had cash of £2.31m, and at the period end, had cash of £3.04m (H1 2019: £1.79m).

 

Dividend

The Board will be declaring an interim dividend of 1.80p per share (2019: 1.80p) payable on 6 December 2019 to those shareholders on the register on 22 November 2019.

 

Outlook

 

The present focus for the Group is managing the business for increased productivity and profitability. Notwithstanding the mixed and uncertain economic picture of today's markets, we continue to seek opportunities to create shareholder value though both organic and non-organic growth.

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.

 

Robert Macdonald

Executive Chairman

14 November 2019

 

For further information please contact:

 

Prime People

020 7318 1785

Robert Macdonald, Executive Chairman

 

Donka Zaneva-Todorinski, Finance Director

 

 

Cenkos Securities

020 7397 8900

Katy Birkin

Harry Hargreaves

 

 

 

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 30 September 2019

 

 

 

 

 

Six months ended

 

Year ended

 

 

30 September

2019

 

30 September

2018

 

 

31 March

2019

 

 

 

 

 

 

 

(audited)

 

Note

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

 

Revenue

3

 

13,166

 

 

12,572

 

24,660

Cost of sales

 

 

 

(4,365)

 

(4,584)

 

(8,873)

 

 

 

 

 

 

 

 

Net fee income

 

 

8,801

 

7,988

 

15,787

 

Administrative expenses

 

 

 

 

(7,072)

 

 

(6,399)

 

 

(13,316)

 

 

 

 

 

 

 

 

Operating profit

 

 

1,729

 

1,589

 

2,471

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit before taxation

 

 

1,729

 

1,589

 

2,471

 

Income tax expense

 

4

 

(308)

 

(104)

 

(298)

 

Profit for the period/year

 

 

 

 

1,421

 

 

1,485

 

 

 

2,173

Other comprehensive income

Exchange gain on translating foreign operations

 

 

115

 

 

121

 

 

106

 

Other Comprehensive income for the period/ year, net of tax

 

 

 

115

 

 

 

121

 

 

 

106

 

Total comprehensive income for the period/year

 

 

1,536

 

 

1,606

 

 

2,279

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Profit attributable to:

Equity shareholders of the parent

Non-controlling interest

 

 

 

1,139

282

 

 

1,291

194

 

 

1,660

513

 

 

 

 

 

 

 

 

 

Profit for the period/year

 

 

 

 

1,421

 

 

1,485

 

 

2,173

 

 

 

 

 

 

 

 

Total Comprehensive Income attributable to:

 

 

 

 

 

 

 

Equity shareholders of the parent

Non-controlling interest

 

 

 

1,254

282

 

1,412

                     194

 

1,766

513

Earnings per share

6

 

 

 

 

 

 

Basic earnings per share

 

 

   9.33p

       10.95p

            13.72p

Diluted earnings per share

 

 

         9.22p

             10.78p

            13.38p

 

 

 

 

 

 

 

 

                 

 

The above results relate to continuing operations.

 

The notes below form an integral part of this unaudited condensed consolidated interim report.

 

 

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

 

As at 30 September 2019

 

30 September

2019

30 September

2018

31 March

2019

 

 

 

 

 

 

(audited)

 

Note

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

Goodwill

 

10,527

 

10,527

 

10,527

Property, plant and equipment

 

708

 

577

 

752

Right-of-use assets

12

1,139

 

-

 

-

Deferred tax asset

 

18

                

45

 

40

 

 

12,392

 

11,149

 

11,319

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Trade and other receivables

9

5,069

 

4,242

 

4,646

Cash and cash equivalents

 

 

3,037

 

1,778

 

2,309

 

 

 

8,106

 

 

6,020

 

 

6,955

 

 

 

 

 

 

 

Total assets

 

 

20,498

 

17,169

 

18,274

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

Trade and other payables

10

2,681

 

2,746

 

3,080

Lease liabilities

12

383

 

-

 

-

Current tax liabilities

 

 

481

 

61

 

173

 

 

 

3,545

 

2,807

 

3,253

Non-current liabilities

 

 

 

 

 

 

Deferred tax liabilities

 

-

 

22

 

22

Lease liabilities

12

1,058

 

-

 

-

 

 

 

 

 

 

 

 

Total liabilities

 

 

 

4,603

 

 

 

2,829

 

 

3,275

 

 

 

 

 

 

 

Net assets

 

 

15,895

 

14,340

 

14,999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital and reserves attributable to the Company's equity holders

Called up share capital

 

1,229

 

1,229

 

1,229

Capital redemption reserve

 

9

 

9

 

9

Treasury shares

 

(168)

 

(439)

 

(161)

Share premium account

 

5,371

 

5,371

 

5,371

Merger reserve

 

173

 

173

 

173

Share option reserve

 

392

 

411

 

337

Currency translation differences

 

711

 

611

 

596

Retained earnings

 

7,308

 

 

6,706

 

6,857

Equity shareholders' funds

Non-controlling interest

 

 

15,025

870

 

14,071

269

 

14,411

588

 

Total Equity

 

 

 

  15,895

 

 

14,340

 

 

14,999

 

 

 

 

 

 

 

 

The notes below form an integral part of this unaudited condensed consolidated interim report.

 

 

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2019

-

Called up share capital

Capital Redemption reserve

Treasury shares

Share premium account

Merger reserve

Share option reserve

Translation reserve

Retained Earnings

Total attributable to equity holders of the parent

Non-controlling interest

Total

equity

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

At 1 April 2018

 

1,229

 

9

 

(421)

 

 

5,371

 

173

 

314

 

490

 

7,764

 

14,929

 

75

 

15,004

 

 

 

 

 

 

 

 

 

 

 

 

Profit for the period

-

-

-

-

-

-

-

1,291

1,291

194

1,485

 

 

 

 

 

 

 

 

 

 

 

 

Adjustment in respect of IFRS 15

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(1,977)

 

 

(1,977)

 

 

-

 

 

(1,977)

Other comprehensive income

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

121

 

 

-

 

 

121

 

 

-

 

 

121

 

 

 

 

 

 

 

 

 

 

 

 

Equity-settled share-based payments

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

97

 

 

-

 

 

-

 

 

97

 

 

-

 

 

97

 

 

 

 

 

 

 

 

 

 

 

 

Shares purchased for treasury

 

 

-

 

 

-

 

 

(16)

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(16)

 

 

-

 

 

(16)

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued from treasury

-

-

2

-

-

-

-

-

2

-

2

 

 

 

 

 

 

 

 

 

 

 

 

Adjustment on share disposal

-

-

(4)

-

-

-

-

 

10

 

6

-

6

 

 

 

 

 

 

 

 

 

 

 

 

Dividend

-

-

-

-

-

-

-

(382)

(382)

-

(382)

 

At 30 Sept 2018

 

 

1,229

 

9

 

(439)

 

 

5,371

 

173

 

411

 

611

 

6,706

 

 

14,071

 

269

 

14,340

 

 

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2019

 

Called up

share capital

Capital

Redemption

reserve

Treasury

shares

Share

premium

account

Merger

reserve

Share

option

reserve

Translation

reserve

Retained

Earnings

Total attributable to equity holders of the parent

Non-controlling interest

Total equity

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

 

At 30 Sept

2018

 

 

1,229

 

9

 

(439)

 

5,371

 

173

 

411

 

611

 

6,706

 

14,071

 

269

 

14,340

Profit for the period

-

-

-

-

-

-

-

368

368

319

687

Other comprehensive income

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(15)

 

 

-

 

 

(15)

 

 

-

 

(15)

Equity settled share-based payments

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(74)

 

 

-

 

 

-

 

 

(74)

 

 

-

 

 

(74)

Shares purchased for treasury

 

 

-

 

 

-

 

 

(10)

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(10)

 

 

-

 

 

(10)

Shares issued from treasury

 

-

 

-

 

284

 

-

 

-

 

-

 

-

 

-

 

284

 

-

 

284

Adjustment on share disposal

 

-

 

-

 

4

 

-

 

-

 

-

 

-

 

(5)

 

(1)

 

-

 

(1)

Dividend

-

-

-

-

-

-

-

(212)

(212)

-

(212)

 

At 31 March 2019

 

 

1,229

 

9

 

(161)

 

5,371

 

173

 

337

 

596

 

6,857

 

14,411

 

588

 

14,999

Profit for the period

 

-

 

-

 

-

 

-

 

-

 

-

 

-

 

1,254

 

1,254

 

282

 

1,536

Impact of IFRS 16

 

-

 

-

 

-

 

-

 

-

 

-

 

-

 

(396)

 

(396)

 

-

 

(396)

Other comprehensive income

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

115

 

 

-

 

 

115

 

 

-

 

 

115

Equity-settled share-based payments

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

55

 

 

-

 

 

-

 

 

55

 

 

-

 

 

55

Shares purchased for treasury

 

 

-

 

 

-

 

(16)

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

(16)

 

 

-

 

 

(16)

Shares issued from treasury

 

-

 

-

 

13

 

-

 

-

 

-

 

-

 

-

 

13

 

 

-

 

13

 

Adjustment on share disposal

 

-

 

-

 

(4)

 

-

 

-

 

-

 

-

 

4

 

-

 

-

 

-

Dividend

-

-

-

-

-

-

-

(411)

(411)

-

(411)

At 30 Sept

2019

 

 

1,229

 

9

 

(168)

 

5,371

 

173

 

392

 

711

 

7,308

 

15,025

 

870

 

15,895

 

 

PRIME PEOPLE PLC

UNAUDITED CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOW

For the six months ended 30 September 2019

 

 

 

Six months ended

Year ended

 

 

30 September 2019

30 September

2018

31 March

2019

 

Note

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

 

Cash generated from underlying operations

 

7

 

 

1,498

 

 

1,260

 

 

2,146

Income tax paid

Income tax received

 

 

 

(1)

19

 

(4)

2

 

(111)

-

 

 

 

 

 

 

 

 

Net cash from operating activities

 

 

1,516

 

1,258

 

2,035

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

Net purchase of property, plant and equipment

 

(94)

 

(438)

 

(727)

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

 

 

(94)

 

 

(438)

 

 

(727)

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

Shares issued from treasury

 

 

13

 

2

 

260

Shares purchased for treasury

 

 

(16)

 

(16)

 

-

Dividend paid to shareholders

 

 

(411)

 

(383)

 

(595)

Lease payments

 

 

(338)

 

-

 

-

Lease interest

 

 

(57)

 

-

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in financing activities

 

 

(809)

 

(397)

 

(335)

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

613

 

423

 

973

 

 

 

 

 

 

Cash and cash equivalents at beginning of period/year

2,309

 

1,234

 

1,234

 

 

 

 

 

 

Effect of foreign exchange rate changes

 

115

 

121

 

102

 

 

 

 

 

 

 

 

Cash and cash equivalents at end of period/year

 

3,037

 

1,778

 

2,309

 

 

 

 

 

 

 

 

 

The notes below form an integral part of this unaudited condensed consolidated interim report.

 

PRIME PEOPLE PLC

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM REPORT

For the six months ended 30 September 2019

 

1.   General information

 

Prime People Plc ('the Company') and its subsidiaries (together 'the Group') is an international recruitment services organisation with offices in the United Kingdom, the Middle East and the Asia Pacific region from which it serves an international client base. The Group offers both permanent and contract specialist recruitment consultancy for large and medium sized organisations.

 

Prime People Plc is the Group's ultimate parent company. The Company is a limited liability company incorporated and domiciled in the United Kingdom. The address of Prime People Group's registered office and its principal place of business is 2 Harewood Place, London, W1S 1BX, England.  Prime People Group's shares are quoted on the AIM Market of the London Stock Exchange ("AIM"). The registered number of the Company is 1729887.

 

This unaudited condensed consolidated interim report for the six months ended 30 September 2019 (including comparatives) is presented in GBP '000 and was approved and authorised for issue by the Board of Directors on 14 November 2019.

 

Copies of the interim results are available at the Company's registered office and on the Company's website - www.prime-people.co.uk.

 

This unaudited condensed consolidated interim report does not constitute statutory accounts of the Group within the meaning of section 434 of the Companies Act 2006. The financial information for the year ended 31 March 2019 has been extracted from the statutory accounts for that year, which have been filed with the Registrar of Companies.  The auditor's report on those accounts was unqualified and did not contain a statement under section 498 of the Companies Act 2006.

 

 

2.     Basis of preparation

 

The unaudited condensed consolidated interim report for the six months ended 30 September 2019 has been prepared using accounting policies consistent with International Financial Reporting Standards ("IFRSs") and in accordance with 'IAS 34, Interim financial reporting', as adopted by the European Union.  The condensed consolidated interim report should be read in conjunction with the annual financial statements for the year ended 31 March 2019 which were, with exception of the adoption of IFRS 16 Accounting for Leases, prepared in accordance with IFRSs as adopted by the European Union.

 

The Group was profitable for the period and has considerable financial resources comprising £3.04m of net cash at 30 September 2019.  After making enquiries, the Directors have formed a judgement, at the time of approving the six months results, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, a period of not less than 12 months. For this reason, the Directors continue to adopt the going concern basis in preparing the condensed set of financial statements.

 

These financial statements have been prepared under the historical cost convention.

 

IFRS 16 - Leases

IFRS 16 became effective for accounting periods beginning on or after 1 January 2019 and has superseded IAS 17 Leases.

 

IFRS 16 distinguishes leases and service contracts based on whether an identified asset is controlled by a customer. Distinctions of operating leases (off balance sheet) and finance leases (on balance sheet) are removed for lessee accounting and has been replaced by a model where a right-of-use asset and a corresponding liability have to be recognised for all leases by lessees (i.e. all on balance sheet) except for short term leases and leases of low value assets.

 

The right-of-use asset is initially measured at cost and subsequently measured at cost (subject to certain exceptions) less accumulated depreciation and impairment losses, adjusted for any remeasurement of the lease liability. The lease liability is initially measured at the present value of the lease payments that are not paid at that date. Subsequently, the lease liability is adjusted for interest and lease payments, as well as the impact of lease modifications, amongst others.

 

Directors have completed their detailed review of IFRS 16 and further guidance on this change in accounting policy is given in note 12 below.

 

 

3.   Segment reporting

 

(a)  Revenue and net fee income by geographical region

 

 

 

Revenue

 

 

Net fee income

 

 

 

Six months ended

Year ended

 

Six months ended

Year ended

30 September

2019

30 September 2018

31 March 2019

30 September 2019

30 September 2018

31 March 2019

 

 

£'000

 

£'000

 

£'000

 

£'000

 

£'000

 

   £'000

 

 

 

 

 

 

 

 

 

 

 

 

 

UK

 

8,072

 

8,439

 

16,472

 

3,707

 

3,855

 

7,599

 

 

 

 

 

 

 

 

 

 

 

 

 

Asia

 

4,832

 

3,866

 

7,770

 

4,832

 

3,866

 

7,770

 

 

 

 

 

 

 

 

 

 

 

 

 

Rest of World

 

262

 

267

 

418

 

262

 

267

 

418

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13,166

 

 

12,572

 

24,660

 

8,801

 

7,988

 

15,787

 

 

 

 

 

 

 

 

 

 

 

 

 

                           

 

All revenues disclosed by the Group are derived from external customers and are for the provision of recruitment services. The accounting policies of the reportable segments are the same as the Group's accounting policies. Segment profit before taxation represents the profit earned by each segment after allocations of central administration costs.

 

(b)  Revenue and net fee income by classification

 

 

 

Revenue

 

 

Net fee income

 

 

 

Six months ended

Year ended

 

Six months ended

Year ended

30 September

2019

30 September 2018

31 March 2019

30 September 2019

30 September 2018

31 March 2019

 

 

£'000

 

£'000

 

£'000

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

Permanent

 

 

 

 

 

 

 

 

 

 

 

 

- UK

- Asia

- Rest of World

 

3,252

4,832

262

 

3,279

3,866

267

 

6,501

7,770

418

 

3,252

4,832

262

 

3,279

3,866

267

 

6,493

7,770

418

 

 

 

 

 

 

 

 

 

 

 

 

 

Contract (UK)

 

4,820

 

5,160

 

9,971

 

455

 

576

 

1,106

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13,166

 

12,572

 

24,660

 

8,801

 

7,988

 

15,787

 

 

 

 

 

 

 

 

 

 

 

 

 

                           

 

(c)  Profit before taxation by geographical region

 

 

 

Six months ended

Year ended

 

30 September

2019

30 September 2018

31 March 2019

 

 

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

 

UK

 

 

478

 

621

 

928

 

 

 

 

 

 

 

 

Asia

 

 

1,243

 

947

 

1,523

 

 

 

 

 

 

 

 

Rest of World

 

 

8

 

21

 

20

 

Profit before taxation

 

 

 

 

 

1,729

 

 

1,589

 

 

2,471

 

 

 

 

 

 

 

 

                 

 

Operating profit is the measure of profitability regularly viewed by the Board, which collectively acts as the Chief Decision Maker. Consequently, no segmental analysis of interest or tax expenses is provided.

 

(d)  Segment Assets and Liabilities by Geographical Region

 

 

 

Total assets

Total liabilities

 

 

30 September 2019

30 September 2018

30 September 2019

30 September 2018

 

 

£'000

£'000

£'000

£'000

 

 

 

 

 

 

UK

 

 

12,211

11,725

2,474

1,553

Asia

 

 

7,916

5,033

2,080

1,215

Rest of World

 

371

411

49

61

 

Total

 

 

20,498

 

17,169

 

4,603

 

2,829

 

The analysis above is of the carrying amount of reportable segment assets and liabilities. Segment assets and liabilities include items directly attributable to a segment and include income tax assets and liabilities.

 

 

4.   Income tax expense

 

The charge for taxation on profits for the interim period amounted to £308k (2018: £104k) an effective rate of 17.81% (2018: 6.55%).

 

 

5.   Dividends

 

 

 

Six months ended

Year ended

 

30 September

2019

30 September

2018

31 March

2019

 

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

Final dividend for 2019: 3.25p per share

(2018: 3.25p per share)

411

 

383

 

383

Interim dividend for 2019: 1.80p per share

(2018: 1.75p per share)

-

 

-

 

212

 

 

 

 

 

 

 

 

 

 

411

 

 

383

 

 

595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

               

 

The interim dividend for 2020 of 1.80 pence (2019: 1.80 pence paid on 7 December 2018), was approved by the board on 14 November 2019 and will be paid on 6 December 2019 to those shareholders whose names are on the register on 22 November 2019.

 

 

6.   Earnings per share

 

Earnings per share (EPS) are calculated by dividing the profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the period.

 

Fully diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares by existing share options assuming dilution through conversion of all existing options.

 

Earnings and weighted average number of shares from continuing operations used in the calculations are shown below:

 

 

 

Six months ended

Year ended

 

                30 September

                2019

30 September

2018

31 March

2019

 

 

                £'000

 

£'000

 

£'000

 

Retained profit for basic and diluted earnings per share

 

 

1,139

 

 

1,291

 

 

 1,660

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                        Number

 

Number

 

Number

 

 

 

 

 

 

 

Weighted average number of shares used for basic earnings per share

 

12,204,023

 

 

11,784,523

 

 

12,094,523

Dilutive effect of share options

 

136,491

 

163,413

 

307,031

 

 

 

 

 

 

 

Diluted weighted average number of shares used for

 diluted earnings per share

 

 

12,340,514

 

 

11,974,936

 

12,401,554

 

 

 

 

 

 

 

               

 

 

 

 

Six months ended

Year ended

 

                30 September

                2019

30 September

2018

31 March

2019

 

 

£'000

 

£'000

 

£'000

 

 

Pence

 

Pence

 

Pence

 

 

 

 

 

 

 

Basic earnings per share

 

9.33p

 

10.95p

 

13.72p

Diluted earnings per share

 

9.22p

 

10.78p

 

13.38p

 

 

 

 

 

 

                   

 

 

7.   Reconciliation of profit before tax to cash flow from operating activities

 

 

Six months ended

Year ended

 

30 September

2019

30 September

2018

31 March

2019

 

 

£'000

 

£'000

 

£'000

 

 

 

 

 

 

 

Profit before taxation

 

1,729

 

1,589

 

2,471

Adjustments for:

 

 

 

 

 

 

Depreciation

 

323

 

104

 

220

Share based payment expense

 

90

 

97

 

38

Finance costs - IFRS 16

 

49

 

-

 

-

(Profit)/Loss on sale of tangible asset

 

-

 

-

 

1

 

 

 

 

 

 

 

Operating cash flow before changes in working capital

 

2,191

 

 

1,790

 

2,730

 

 

 

 

 

 

IFRS 15 adjustment on reserves b/f

-

 

-

 

(1,976)

(Increase)/ decrease in receivables

(423)

 

(596)

 

976

(Decrease)/ increase in payables

 

(270)

 

66

 

416

 

Cash generated from underlying operations

 

 

1,498

 

 

1,260

 

 

2,146

 

 

 

 

 

 

               

 

 

8.   Reconciliation of net cash flow to movement in net funds

 

 

 

Six months ended

Year ended

 

30 September

2019

30 September

2018

31 March

               2019

 

 

£'000

 

£'000

 

         £'000

 

 

 

 

 

 

 

Increase in cash and cash equivalents in period/year

613

 

423

 

969

Net funds at the start of the period/year

 

2,309

 

1,234

 

1,234

Other non-cash changes

 

115

 

121

 

106

 

 

 

 

 

 

 

Net funds at the end of the period/year

 

 

3,037

 

1,778

 

2,309

 

 

 

 

 

 

 

               

 

 

9.   Trade and other receivables

 

 

30 September

2019

30 September 2018

31 March

2019

 

£'000

£'000

£'000

 

 

 

 

Trade receivables

4,765

4,229

4,156

Allowance for doubtful debts

(650)

(882)

(621)

Prepayments and accrued income

722

808

868

Other receivables

232

87

243

 

 

 

 

 

 

5,069

4,242

4,646

 

 

 

 

 

 

10. Trade and other payables

 

 

30 September

2019

30 September 2018

31 March

2019

 

£'000

£'000

£'000

 

 

 

 

Trade payables

                        187

182

316

Taxation and social security

                        674

797

730

Other payables

                        212

456

807

Accruals and deferred income

                     1,608

1,311

1,227

 

                     2,681

                      2,746

                    3,080

 

 

 

 

 

 

11. Treasury Shares

 

At 30 September 2019, the total number of ordinary shares held in Treasury and their values were as follows:

 

 

30 September 2019

 30 September 2018

 

Number

£'000

Number

£'000

 

 

 

 

 

As at 1 April

195,676

161

505,676

421

Shares purchased for treasury

19,000

16

20,000

16

Shares issued from treasury

(128,500)

(13)

(20,000)

(2)

Equity reclassification on disposal of treasury shares

 

-

 

4

 

-

 

4

                                                                                                                                          

As at 30 September

 

86,176

 

168

 

505,676

 

439

 

Nominal value

 

-

 

9

 

-

 

51

 

Market value

-

75

-

425

 

 

12. Changes in accounting policies

 

Adjustments recognised on adoption of IFRS 16

This note explains the impact of the adoption of IFRS 16 Leases on the Group's financial statements. The Group has adopted the IFRS 16 modified retrospective approach from 1 April 2019 but has not restated comparatives for the 31 March 2019 reporting period, as permitted under the specific transitional provisions in the standard. The reclassifications and the adjustments arising from the new leasing rules are therefore recognised in the opening balance sheet on 1 April 2019.

 

The weighted average incremental borrowing rate used is 8.47%.

 

The Group has elected not to recognise the right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less or leases that are of low value (£5,000). Lease payments associated with these leases are expensed on a straight-line basis over the lease term.

 

The table below summarises the IFRS 16 impact on transition for lease liabilities and the corresponding right-of-use assets along with the movement from 1 April 2019 to 30 September 2019:

 

Lease liability                                                                                                                  

£'000

Operating lease commitment disclosed as at 31 March 2019

                       1,817

Less short-term and low value lease

                           (27)

Exchange difference

                          104

Operating lease commitment at 31 March 2019 falls under IFRS 16

                       1,894

Discounted using borrowing incremental rate at initial application

                         (220)

 

 

Lease liabilities recognised at 1 April 2019

                      1,674

 

 

 

 

Lease liabilities movement from 1 April 2019 to 30 September 2019

 

At 1 April 2019

                       1,674

Lease payments

(338)

Interest charge

57

Exchange difference

49

Total lease liabilities at 30 September 2019

1,441

 

 

Current lease liabilities

383

Non-current lease liabilities

1,058

 

Right-of-use assets

 

 

 

 

 

30 September 2019

1 April 2019

 

 

£'000

£'000

Properties

 

1,139

1,282

Total right-of-use-assets

 

1,139

1,282

 

 

13. Related Party Transactions

 

Prime People Plc provides various management services to its subsidiary undertakings. These services take the form of centralised finance and operations support. The total amount charged by the Company to its subsidiaries during the period is £462k (2018: £384k). The balance owed to the subsidiary undertakings at the period-end is £1m (2018: £409k).


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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