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FDM (AIM: FDMG), the international IT services business, today announces interim results for the six month period to 30 June 2009. Gross profit increased 6.5% to 6.92m Pounds (H1 2008: 6.50m Pounds). Gross profit margins moved to 27.6% (H1 2008: 25.6%). Profit before tax decreased 7.7% to 2.20m Pounds (H1 2008: 2.39m Pounds).
Direct costs of the newly expanded London office account for 231,000 Pounds of the increase in overheads. The conversion ratio (the ratio of EBIT to gross profit) decreased to 31.3% from 34.9%. Diluted earnings per share decreased 4.5% to 6.4p (H1 2008: 6.7p per share). The Interim dividend was maintained at 1.0p per share (H1 2008: 1.0p)
The company has a strong net cash position of 9.46m Pounds (H1 2008: 5.28m Pounds). Rod Flavell, Chief Executive of FDM Group, commented "Our Mountie proposition (IT Consultants) continues to provide clients with a compelling alternative to a traditional outsourcing model but our markets remain fragile. Although in absolute terms we have grown the number of Mountie placements, conditions across our markets mean that the number of chargeable staff deployed is behind Board expectations and we are seeing some margin pressure particularly within our freelance contractors"
"The last six months have proved to be very challenging and we fully expect this trend to continue. In such a tough economic environment it is testament to the hard work of our people that we have been able to make the progress that we have and we extend our thanks to everybody throughout the Group."
"We face a number of challenges in 2009 none more significant than changes in the buying behaviour of our clients. This means that visibility of future earnings has reduced and predictability has become more difficult throughout our client portfolio and across our international businesses."
"Our ability to navigate through these uncertain times is the key determinant of our short-term success. Therefore, our focus for the second half of 2009 is to maintain our excellent client relationships, maximise all opportunities that we create and ensure that we minimise the impact of short-term economic decline. "
In early trading shares were up by 1.58% to approximately 1.08 Pounds.