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Chandler MacLeod (CMG:ASX), the third-largest recruiter in Australia, expects full-year net profit after tax before restructuring and acquisition costs to be in the range of AUD 17 million and AUD 19 million.
The company also anticipates EBITDA of up to AUD 46 million for the year.
The HR provider has recently entered into a binding agreement to buy all of the shares in Vivir Healthcare for AUD 34.6 million. Privately-owned Vivir provides clinical services such as physiotherapy to the aged care sector. Chandler MacLeod said the Vivir business has had strong results to date with the business integration going well.
But the recruiter overall warned that business confidence remained weak and customers are focused on cutting costs, resulting in lower contractor hours worked. The mining sector has also posted lower demand for staffing services.
“While the market conditions we have faced have presented significant challenges to our staffing services business, our strategic direction to change our business mix has been vindicated as our new managed services businesses have not been impacted by the malaise in the broader economy,” said Chandler MacLeod managing director, Cameron Judson.
“There are still areas in our business where costs can be reduced. This will involve reengineering and simplification of our processes. We are aiming to achieve another AUD 5 million in annualised cost savings in 2014. The behaviour of customers in the mining sector will naturally affect the staffing services business in 2014, however, this business does have many efficiency opportunities to be realised and a very healthy pipeline of existing and new clients to target,” he said.
Chandler Macleod has a market share of over 5%, according to research on the Australian staffing market by Staffing Industry Analysts. Founded in 1959, the company provides temporary workers in a range of specialist sectors and has grown rapidly following the acquisition of Ross Human Directions in February last year.