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UK – Prime People achieves strong UK growth

07 November 2013

Recruitment firm Prime People (PRP: AIM) reported revenue for the six months ending 30 September 2013 of £6.8 million, a rise of +7.9% compared with £6.3 million last year. Net fee income fell slightly by -0.5%, from £3.78 million to £3.76 million, year-on-year.

The company more than doubled their operating profit for the period, rising by +168% from £107,000 in H1 2012 to £287,000 for H1 2013. Net income for the period more than trebled, from £33,000 to £159,000, year-on-year.

Robert Macdonald, Executive Chairman of Prime People, commented: “Whilst trading across our revenue areas in the first half has been variable, net fee income (NFI) for the Group is broadly the same as for the corresponding period last year, but with improving NFI in the second quarter across the Group.”

“NFI from the Rest of the World, representing less than 10% of total NFI, has fallen by -33%, whereas in the UK and Asia, NFI has increased by +4% and +7%, respectively. With a back-drop of improved trading conditions, we continue with the development of our international business in Asia, which we believe will provide us with increased opportunities for growth in the mid to long term. Permanent recruitment remains the main focus of our business representing 90% of NFI, compared to 91% in the comparable period for 2013,” he concluded.

The UK remains Prime People’s largest business region. Revenue for the six months rose by +13.3% to £5.5 million, compared with £4.9 million last year. Revenue from temporary recruitment in the region surpassed permanent recruitment revenue. The UK is the only region in which Prime People offers temporary recruitment services, contributing revenue of £3.4 million; an increase of +20.7% compared with H1 2012. Revenue from permanent recruitment services in the UK rose by +3% to £2.1 million from £2 million last year. 

Revenue from Asia operations increased during the period to £917,000 from £854,000, equating to a year-on-year rise of +7.4%. The Rest of the World region, however, reported a -33.3% drop in revenue to £364,000, down from £545,000 last year.

Looking forward, Mr Macdonald stated: “As we step into the second half of the year we have reasonable expectations that the UK businesses will continue to perform as least at similar levels to the first half of the year or better. We are looking for continued improved performances from our businesses in Asia, but have conservative expectations as to the likely performance from our businesses in the Rest of the World.”

“The focus for the Group is to maximise the returns from recent investments and continue to recruit new heads into those markets where there is potential for NFI and profit growth,” he concluded.

In trading today, the company’s share price remained static at £0.76, an increase of +66.4% compared with a year ago. Based on its share price, the company has a current market value of £8.84 million.  

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