UK-based IT staffing firm Harvey Nash (HVN: LSE) has announced its preliminary results for the year ending 31 January 2017. The company reported revenue £784.3 million, an increase of 6% in constant currency compared with the previous year. 

“The group has delivered a resilient trading performance, underpinned by stronger than expected cash generation and an increased dividend,” Julie Baddeley, Chairman of Harvey Nash, said. “In the UK, the group delivered a very strong performance relative to market conditions. In Europe, Netherlands, Belgium and Sweden reported double digit revenue and profit growth. Across the group, loss-making offices were returned to profit and steps taken to close offices where weak market conditions continue to prevail.”

Gross Profit by geography was broken down as follows:

The UK & Ireland represented 37.8% of the group's gross profit in 2017. Gross profit from contracting was 3.5% higher than the previous year, up 2.4% on a constant currency basis. Permanent revenue improved in the second half, but for the year as a whole was 5.7% lower than the previous year (down 6.6% on a constant currency basis).

In Mainland Europe, which accounts for 40% of the Group’s total gross profit, temporary and contract management placements accounted for 60.1% of gross profit and permanent executive and professional placements accounted for 39.9%. Permanent revenue increased by 24.0% (12.7% on a constant currency basis) with a particularly notable increase in Germany of 71.5% (50.1% constant currency). Gross profit in Benelux increased by 33.3% (16.7% on a constant currency basis).

Meanwhile, the Nordic region, which comprises Sweden, Norway and Finland recorded gross profit growth of 22.7% (9.2% on a constant currency basis). The group’s Central Europe region comprises Germany, Switzerland and Poland. Gross profit fell by 2.2% (13.3% on a constant currency basis) in the region.

In Rest of World, the US, which represents 17.0% of the group’s gross profit in 2017, gross profit increased by 12.4% to £16.6 million, although it was down 1.1% on a constant currency basis, with demand favouring permanent and executive recruitment.

In the Asia Pacific region, which represents 5.5% of the group's gross profit in 2017, gross profit decreased by 11.8%.

“The group has a robust and diverse business model, which has delivered strong performances despite the challenging economic backdrop in some of the group’s markets, not least the UK,” Albert Ellis, Chief Executive Officer of Harvey Nash, said. “The results are underpinned by stronger than expected cash generation and an increased dividend.

“During the year, we took several initiatives to streamline the business and we have a clear strategy to grow the business both organically and by acquisition,” Ellis said. “Our vision is to be Europe’s market leading technology and digital talent provider with challenger businesses in the US and Asia. “We are confident of driving profitable growth in the year to January 2018, whilst remaining flexible in response to changes in market conditions. The current financial year has started well, with performance marginally ahead of expectations.”

“We have a clear strategy to grow the business and our vision is to be Europe’s market leading technology and digital talent provider with challenger businesses in the US and Asia,” Elllis said. “With the benefits from the actions taken, we are confident of driving profitable growth in the year to January 2018, whilst remaining flexible in response to changes in market conditions. The current financial year has started well, with performance marginally ahead of expectations.”

As of last trade Harvey Nash Group traded at £73.45, 8.12% below its 52-week high of £79.94, set on 27 April 2016. Based on its current share price the company has a market value of £50.7 million.