Specialist engineering and professional services staffing firm Gattaca (GATC:LSE) reported revenue of £635.8 million for the 12 months ended 31 July 2019, an increase of 1% compared to the same period last year. Net Fee Income (NFI) was down 1% over last year.

Reported results for the year were as follows.

The group reported contract net fee income of £49.3m (2018: £51.0m) at a margin of 8.0% (2018: 8.4%), and permanent recruitment fees were £21.3m (2018: £20.4m).

Gross margins were 11.1% (2018: 11.3%) driven by the change in contractor margins, partly offset by the increase in permanent NFI mix (permanent NFI made up 30% while contract NFI made up 70% of the product mix.)

Engineering net fee income stood at £49.4 million in 2019, up 4% from last year. Technology net fee income was £11.6 million, down 20% from last year.

The group said the decline in its technology net fee income was a result of repositioning the business towards more sustainable and profitable business but there were also performance factors. Gattaca added that a new Head of Technology has now been on board for three months and is addressing the performance of the division.

In order to focus on its core UK and North American business, Gattaca previously announced it would exit the Telco Infrastructure in Asia, Africa and Latin America.  Working to close down those operations and reduce its working capital has been a key focus for this year. The decision led to a significant reduction in net debt.

The company is currently undergoing an ‘Improvement Plan’ with a focus on core growth markets following a review of its international business in H1.

Gattaca also announced that after 26 years of service, COO Keith Lewis has decided to stand down from the Board of Directors of Gattaca plc and will leave the group with immediate effect. As part of its Improvement Plan, the group does not intend to replace the role of COO.

Last year Gattaca appointed Kevin Freeguard as Chief Executive Officer and member of the Board of Directors.

Revenue by geography

Freeguard commented, “We remain cautious about the development of our markets in 2020, although we believe that operationally, we have made significant progress with our ongoing Improvement Plan, which is now translating into tangible change in the way we operate and will put the group firmly on the path for sustainable, long-term growth.”

Patrick Shanley, Non-Executive Chairman, commented, “Looking ahead, we are building a strong platform for sustainable growth over the long term. We have demonstrated that we can grow our engineering business even during difficult periods and have taken action to address the issues in our technology business. However, we cannot be complacent about external headwinds such as trends in global trade, the potential economic impact caused by the uncertainty of Brexit and the upcoming IR35 regulatory changes in our UK industry.”

As of last trade, Gattaca traded at £114.50, down 2.97% on the day and 23.78% above the 52 week low of £92.50 set on 27 February 2019. Based on its current share price the company has a market value of £38.10 million.