Polish contract, RPO, and outsourcing company Work Service Group (WSE:WSE) and (WSE: LSE) reported revenue for the year ending 31 December 2016 of PLN 2.48 billion (586.5 million), an increase of 16% from PLN 2.14 billion (€501.6 million) compared to 2014.

“The last twelve months have been busy for us,” Maciej Witucki, President of the Management Board of Work Service S.A, said. “We began several transformation processes of the Work Service Capital Group, starting from changes in the management board, followed by a structural re-organisation, and ending with setting new development objectives for the upcoming years."

“Many of the actions we have commenced are in the course of implementation, but we can already talk about double-digit growth of our business, optimisation of the structure through consolidation of companies and execution of transactions aiming at the unification of the business model,” Witucki said.

Data from Interconnection Consulting for last year confirms that Work Service Group has strengthened its leading position in the human resources services market in the Central and Eastern Europe, with a market share of almost 15%.

In 2016, almost 45% of the revenues came from international operations, and the number of full-time-equivalent positions employment through Work Service increased by 5% year over year.

“We recorded solid results on the back of a market-beating 9% organic growth. However, the PLN 63 million (€14.9 million) level of operating profit was lower than we expected. This was the result of a one-off cost relating to the restructuring of the business in Germany, changes in personnel and completion of investment processes started earlier," Witucki said.

The company also announced that it had signed a preliminary conditional agreement to sell a 95% stake in IT Kontrakt for PLN 147 million (€34.7 million) to private equity firm Oaktree Capital Management (represented in Poland by Cornerstone Partners) a preliminary agreement to sell the shares of IT Contract. The funds raised will be used for the development of the main business segment of Work Service. Work Service first acquired a stake in IT Kontrakt in May 2012 for PLN 52 million (€12.3 million).

Work Service published a forward-looking statement for 2017. 

“In 2017, the most important challenge for employers will be the recruitment of new employees. This is why Work Service, in order to build a competitive advantage in the sector of employment agencies, will implement several solutions for the expansion of recruitment resources. Innovative recruitment tools based on new technologies and mobile solutions have been developed. Cross-border projects are being developed in the region and a new structure in Ukraine, which will support recruitment process for Polish companies, is also being developed.”

“A period of further transformation is ahead us, but we are convinced that the current and planned actions will translate into measurable results. We are approaching higher transparency and effectiveness and thus, for the first time in the history of the Work Service Group, we present results guidance for 2017 which anticipates an operating profit reaching PLN 85.3 million (€20.2 million)” Witucki said.

As of last trade, Work Service SA traded at PLN 9.75 (€2.31), down 1.32% on the day and 12.98% above the 52-week low of PLN 8.63 (€2.04) set on 20 May 2016. Based on its current share price the company has a market value of PLN 643.1 million (€152.1 million).