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Dutch staffing firm DPA Group NV (DPA: NL) reported revenue for the six months ending 30 June 2014 of €40.1 million, an increase of +17% compared with €34.3 million during the same period last year.
Gross profit for the period rose to €9.7 million, an increase of +31% from €7.4 million a year ago. The company achieved a net income of €1 million, equating to year-on-year growth of +25% from €800,000 in H1 2013.
Eric Winter, CEO of DPA, commented: “The stable performance and increased profitability of DPA are due to our focus on delivering distinctive knowledge and skills. Strengthening the added value for clients and attractive employment remain major concerns, as well as obtaining additional economies of scale through organic growth and acquisitions. Also in the first half of 2014, we invested in new operations in promising niches, and we will continue to do so.” Broken down by business segment, Finance, Banking & Insurance remains DPA largest division reporting revenue of €18.3 million, an increase of +4% from €17.6 million last year. The company’s Technology & ICT division reported strong revenue growth of +44% in H1, rising to €14.1 million from €9.8 million a year ago. DPA’s Legal & Public Sector division achieved revenue growth of +3% in H1, rising from €7.6 million in H1 2013 to €7.8 million this year.
During the third quarter of 2013, the company announced that it would cease operations in their DPA Education and DPA Human Resources business segments. Both businesses were deemed to be no longer financially viable.
The company also announced that it had reached an agreement with the shareholders of Fagro Holding BV to acquire 100% of the company’s shares for an initial cash consideration of €9 million. Further payments of both cash and shares are contingent on the company meeting EBITDA targets in 2014, 2015, and 2016. Fagro is a recruitment consultancy specialising in finance and business control.
Mr Winters commented on the acquisition: “We offer clients state-of-the-art knowledge and we offer professionals appropriate challenges, development opportunities, and training. Fargo follows the same approach for high-quality professionals in specific fields within finance and control. Strategically and commercially, this is, in all respects, an excellent match.”
This new acquisition follows three acquisitions made during 2013 which helped lift the H2 results: Credit Force, Cauberg-Huygen Consulting Engineers, and Technipower. Credit Force contributed €900,000 in revenue during H1 2014, while Technipower contributed €1.7 million, and Cauberg-Huygen €3 million. In the absence of these acquisitions, the company’s H2 2014 revenue growth would have been only €200,000, an increase of less than +1% over H2 2013.
According to research conducted by Staffing Industry Analysts, DPA was among the top 25 staffing firms in the Netherlands in 2012 in terms of revenue.
Investors failed to respond enthusiastically to the company’s results and the new acquisition, with the share price dropping by -3.5% to €1.79 in early trading today, an increase of +19% compared with last year. Based on its current share price, the company has a market value of €81 million.