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Recruitment firm Networkers International (NWKI:LSE) does not expect profits in the second half of the year to match those from a year ago, the company reported in an interim statement on Monday.
Revenue in the first six months of the year increased by +4.3% to £90.62 million, rising in all geographical areas but the Americas where sales dropped -7.5%. In Europe, the firm’s largest division, revenue increased marginally to £75.32 million from £74.77 million.
Gross profit in the period was up +16.7% to £15.89 million, driven by international operations and an increase in both contract and permanent placements. Gross profit in the UK declined by -6% while the company saw +28% growth in its international markets. Overall, this resulted in an improved gross margin of 17.5%, compared to 15.7% a year ago.
In the six months to June, gross profit derived from contract placements increased by +12.5% with the permanent business seeing stronger growth of +37.4%.
Group profits from operations rose +16.7% to £3.43 million while profit after tax increased +18.7% to £2.11 million in the first half of the year.
“These results reflect strong growth in our international IT and Energy & Engineering divisions although market conditions tightened in the group's telecoms sector… We remain on track to deliver good growth in line with market expectations, although as expected, we do not anticipate second half profits to quite match the exceptional results achieved in the second half of 2011,” said CEO Spencer Manuel.
Networkers International is one of the 30 largest staffing firms in the UK. The company provides recruitment services through its core divisions information technology and telecommunications. Last year the firm made revenues of £190 million, an increase of +24.2% year-on-year.
In early trading this morning, the company’s share price was flat at 38 pence, down -5.6% from a year ago and -10.9% below its 52-week high of 42.65 pence seen in January. The firm has a market value of £33.85 million.