Australian labour hire firm Ashley Services Group announced that its subsidiary, Linc Personnel, was not successful in securing a renewed contract with its major customer.

Linc will continue to provide labour to their major customer until 29 November 2023, under the terms of its existing contract, albeit with reduced manning versus the prior corresponding period.

Linc stated that it is actively pursuing opportunities to redeploy its existing workforce to other customers. 

The Ashley Services subsidiary contributed AUD 1.1 million (USD 0.7 million) in net profit after tax in the financial year ended 30 June 2023, equating to 10% of the group net profit after tax for that period.

The group stated that contribution to net profit after tax from Linc in the financial year ended 30 June 2024 ("FY24") will be negligible.

Ashley Services acquired Linc Personnel on 5 July 2022 for AUD 4.2 million (USD 2.7 million).

Amortisation will be accelerated to write down the carrying value of customer relationships to zero in the six-month reporting period to 31 December 2023.

The company said it will review the carrying value of goodwill and other related balances acquired during the purchase (net carrying value approximately AUD 1.3 million (USD 0.8 million)) as part of its normal half-year reporting process, considering the outcomes from other opportunities for the business.