TIDMRTC
RNS Number : 8780A
RTC Group PLC
26 March 2013
RTC Group Plc ("RTC", "the Company" or "the Group")
Audited results for the year ended 31 December 2012
RTC Group Plc, a support services group which provides
recruitment and conferencing services, is pleased to announce its
audited results for the year ended 31 December 2012.
Highlights
-- Group revenue from continuing operations up 39% to GBP43m (2011: GBP31m)
-- Group operating profit from continuing operations before
exceptional items of GBP592,000 (2011: loss GBP87,000)
-- Profit for the year attributable to equity holders of GBP575,000 (2011: loss GBP611,000)
-- Profit per share from continued operations of 3.51p (2011: loss 4.17p)
The Board does not believe that it would be prudent to use its
financial resources to recommend a dividend at this time (2011:
nil).
Commenting on the results Bill Douie, Chairman, said:
"2012 has been a year of strong growth both in turnover and
operating profit. However, it comes as no surprise to us all that
material recovery from the recent recession remains patchy and
volatile. Nonetheless, we are confident that we have a range of
activities which all hold much promise for the Group. In addition,
ATA UK was restructured with effect from 1 January 2013 and we are
currently investing in additional headcount and recruitment
technology. We therefore expect to be approximately break-even for
the first half of the financial year and generate the vast majority
of projected profits in the second half as these staff become fully
effective and we start to see the benefits of the additional
investment in the new structure. We believe this longer term
strategy will permit sustainable and profitable growth in the years
to come."
Enquiries:
RTC Group Plc 01332 861 835
Bill Douie, Chairman
Andy Pendlebury, Chief Executive
Allenby Capital Limited - Nominated
Adviser & Broker 020 3328 5656
Jeremy Porter, Corporate Finance
Mark Connelly, Corporate Finance
Chairman's statement
For the year ended 31 December 2012
I am pleased to present the audited results for the year ended
31 December 2012.
Group
2012 has been a year of strong growth both in turnover and
operating profit. As a result we have achieved a pleasing
performance in Group operating profits before exceptional items of
GBP592,000 (2011: loss GBP87,000), contributing to a group pre-tax
profit of GBP474,000.
Trading
ATA Recruitment
UK white collar recruitment performed extremely well in markets
which continue to be volatile.
Revenue is up 30% at GBP20.601m and operating profit was
GBP0.252m (2011: loss GBP206,000).
ATA Global Supply Solutions
2012 saw the first full year effect of the largest element of
our contract in Afghanistan. Operating teething problems have been
eliminated, with travel arrangements running smoothly and currency
conversion costs reduced. Revenue is up 66% at GBP13.736m (2011:
GBP8.239m) and operating profit was GBP123,000 (2011: loss of
GBP87,000).
Ganymede Solutions
Another year of good growth across all disciplines. Revenue was
up 42% at GBP6.885m and operating profit was GBP201,000 (2011:
profit of GBP171,000 before exceptional items). During the year RTC
Group plc purchased the remaining 10% non-controlling interest in
Ganymede Solutions Limited previously held by Gary Hewett, for
GBP41,000, making it a 100% owned subsidiary.
The Derby Conference Centre
The market for conferencing remains tight and highly
competitive.
Revenue was GBP1.741m (2011: GBP1.763m) and operating profit was
GBP16,000 (2011: GBP35,000).
Capital investment
Our enhanced trading performance has enabled us to make a modest
increase in capital expenditure of GBP71k after providing for
working capital to service increased turnover.
Balance sheet
The Group balance sheet has strengthened during the year, with
net working capital increasing by GBP316,000 to GBP529,000 (2011:
GBP213,000) and a slightly increased ratio of current assets to
current liabilities of 1.07 (2011: 1.03). Our gearing ratio has
fallen to 3.0 from 4.9. Gearing is calculated as current bank
borrowing over equity. Net debt at 31 December 2012 was GBP3.5m
(2011: GBP3.1m). The Group continues to be focussed on cash
generation and ensuring a robust balance sheet to support the
growth of the business.
Dividends
Notwithstanding the reported profitability for the period, the
directors do not feel it prudent to recommend any dividend payment
for 2012.
Management
The new management structure established early in the year has
bedded in well and we are confident in its ability to deliver
future growth for the Group.
Chairman's statement
For the year ended 31 December 2012
The Group Board
As recently announced Andrew Bailey left the Group and we wish
him well. I would like to express our thanks for the diligence and
unswerving loyalty he has displayed during his many years with the
Group.
I would also like to welcome Sarah Dye to the Group as Finance
Director.
Outlook
It comes as no surprise to us all that material recovery from
the recent recession remains patchy and volatile. Nonetheless, we
are content that we have a range of activities which all hold much
promise for the Group and are expected to permit continued growth
in the years to come. We intend to continue to concentrate on
exploring opportunities for additional business in all areas of
recruitment covered by our three core business activities, whilst
making the fullest possible use of our premises in Derby both as a
profit centre and as our Head Office.
ATA UK was restructured with effect from 1 January 2013 and we
are currently investing in additional headcount and recruitment
technology. We therefore expect to be approximately break-even for
the first half of the financial year and generate the vast majority
of projected profits in the second half as these staff become fully
effective and we start to see the benefits of the additional
investment in the new structure. We believe this longer term
strategy will permit sustainable and profitable growth in the years
to come.
We remain committed to our goal of building a focused group with
both sustainability and profitability which will deliver increased
earnings per share for our investors and we intend to continue to
use free cash flow to enhance our balance sheet, to provide working
capital for expansion and to invest in the future wherever
necessary.
Staff
I should like to thank our staff at all levels for their
loyalty, hard work and enthusiasm.
W J C Douie 26 March 2013
Chairman
Chief Executive's statement
For the year ended 31 December 2012
2012 delivered a much more positive set of results for the
Group. The investments that were made in previous years in
operational systems and procedures alongside the appointment of
additional finance and support staff have paid off and we are now
beginning to capture the profits from the continued growth in sales
revenue and gross profit across all areas of the business.
The shape of our business continues to change and I believe we
have significantly diluted our exposure and risk to the United
Kingdom market place which continues to suffer from sluggish growth
as both bank lending to the small and medium size business
community and public and private sector investment in major
infrastructure projects remain disappointingly slow.
Our international business which comprises of ATA Global
Staffing Solutions (ATA GSS) and ATA India (ATAI) now generates
around 30% of group revenue and some 25% of gross profit. ATA GSS
continues to build on its contract to supply staff to Afghanistan
and we now deploy over 1200 personnel from over 25 countries to
support our clients. ATA GSS is now recognised as the largest
employment business supplying temporary labour to clients in the
region and we remain extremely optimistic about future growth
opportunities on both this and other emerging international
projects.
ATAI, which originated as a strategic partnership to source
international staff for Afghanistan, was formerly launched as part
of RTC during 2012, and continues to establish itself in one of the
world's fastest growing economies. ATAI have already secured some
long term contracts within the domestic Indian market and in
collaboration with our ATA UK business, is sourcing staff for UK
clients diversifying into the Indian market place and sourcing
Indian candidates for placement with clients seeking scarce skills
within the United Kingdom.
Whilst the UK recruitment market remains difficult, ATA UK has
continued to secure new clients across both the SME and blue chip
market sectors. Furthermore, and despite tough pricing conditions
and heavy discounting from much of the competition as new business
opportunities are becoming increasingly harder to find, the
business is steadily growing its client base and net fee
income.
Ganymede Solutions has continued to accelerate its presence in
the blue collar rail sector on both mainline and underground
networks and is now working with a broad range of prime and second
tier contractors. Whilst historically the business has concentrated
activities primarily in the transport sector, new opportunities are
being explored across other blue collar labour intensive
markets.
Our conference and events business, the Derby Conference Centre
(DCC), continues to capture business across all areas of activity
in what remains an extremely crowded and competitive market. In
order to keep the unique edge that the Art Deco styled facility
offers clients, a capital investment plan was approved for the DCC
during the year to ensure the business can continue to attract long
term sustainable revenue.
Chief Executive's statement
For the year ended 31 December 2012
Finally, the significance of the turnaround in profits for 2012
is testament to the quality, commitment and belief of the company's
management team and employees across all areas of the business and
your board of directors is extremely thankful for everybody's
contribution.
A M Pendlebury 26 March 2013
Group Chief Executive
Consolidated statement of comprehensive income
For the year ended 31 December 2012
2012 2011
Notes GBP'000 GBP'000
Revenue 42,963 30,670 *
Cost of sales (37,735) (26,668) *
---------------------------------------------- ----------- --- ----------------- ---------------------
Gross Profit 5,228 4,002
Administrative expenses (4,636) (4,467)
---------------------------------------------- ----------- --- ----------------- ---------------------
Operating profit/(loss) 592 (465)
---------------------------------------------- ----------- --- ----------------- ---------------------
Analysed as:
Operating profit/(loss) before exceptional
items 592 (87)
Exceptional administrative expense 5 - (378)
---------------------------------------------- ----------- --- ----------------- ---------------------
Operating profit/(loss) after exceptional
items 592 (465)
---------------------------------------------- ----------- --- ----------------- ---------------------
Financing expense (118) (96)
---------------------------------------------- ----------- --- ----------------- ---------------------
Profit/(loss) before tax 474 (561)
Income tax 6 101 62
---------------------------------------------- ----------- --- ----------------- ---------------------
Net profit/(loss) from continuing
operations 575 (499)
(Loss) from discontinued operations 5 - (112)
---------------------------------------------- ----------- --- ----------------- ---------------------
Loss from discontinued operations - (112)
---------------------------------------------- ----------- --- ----------------- ---------------------
Net profit/(loss) and total comprehensive
income for the year 575 (611)
---------------------------------------------- ----------- --- ----------------- ---------------------
Basic and diluted:
Profit/(loss) per share - continuing
operations (pence) 3 3.51 ((4.17)
Profit/(loss) per share - discontinued
operations (pence) 3 - (0.93)
---------------------------------------------- ----------- --- ----------------- --- ----------------
Profit/(loss) per share - continuing
and discontinued operations (pence) 3.51 (5.10)
---------------------------------------------- ----------- --- ----------------- --- ----------------
There is no dilutive effect of share options.
* The 2011 results have been restated. Recruitment revenue and
cost of sales have been grossed up in respect of billable travel
expenses previously netted off in error (see note 4).
Consolidated statement of changes in equity
For the year ended 31 December 2012
Share Share Capital Share Accumulated Total
capital premium redemption based losses equity
account reserve payment
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2012 135 2,468 50 33 (2,049) 637
Net profit and total
comprehensive income
for the year - - - - 575 575
Share acquisition - - - - (41) (41)
Share based payment
reserve - - - (33) 33 -
At 31 December 2012 135 2,468 50 - (1,482) 1,171
----------------------- --------- --------- ------------ --------- ------------ --------
Share Share Capital Share Accumulated Total
capital premium redemption based losses equity
account reserve payment
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2011 90 2,117 50 30 (1,438) 849
Net loss and total
comprehensive income
for the year - - - - (611) (611)
Share issue (net
of expenses) 45 351 - - - 396
Share based payment
reserve - - - 3 - 3
At 31 December 2011 135 2,468 50 33 (2,049) 637
----------------------- --------- --------- ------------ --------- ------------ --------
The share based payment reserve comprises the cumulative share
option charge under IFRS 2 less the value of any share options that
have been exercised or have lapsed.
Consolidated statement of financial position
As at 31 December 2012
2012 2011
GBP'000 GBP'000 GBP'000 GBP'000
Assets
Assets
Non-current
Property, plant and equipment 403 292
Deferred tax asset 239 132
-------------------------------
642 424
Current
Inventories 13 14
Trade and other receivables 8,059 6,444
8,072 6,458
------------------------------- -------- -------- -------- --------
Total assets 8,714 6,882
------------------------------- -------- -------- -------- --------
Liabilities
Current
Trade and other payables (4,034) (3,096)
Current borrowings (3,509) (3,149)
Total liabilities (7,543) (6,245)
Net assets 1,171 637
------------------------------- -------- -------- -------- --------
Equity
Share capital 135 135
Share premium 2,468 2,468
Capital redemption reserve 50 50
Share based payment reserve - 33
Accumulated losses (1,482) (2,049)
------------------------------- -------- -------- -------- --------
Total equity 1,171 637
------------------------------- -------- -------- -------- --------
Consolidated statement of cash flows
For the year ended 31 December 2012
2012 2011
------------------------------------------- -------- --------
GBP'000 GBP'000
Cash flows from operating activities
Operating result from continuing
operations 592 (465)
Adjustments for:
Employee equity settled share options - 3
Depreciation 149 156
Loss on sale of property, plant
and equipment - 5
Change in inventories 1 (4)
Change in trade and other receivables (1,621) (1,657)
Change in trade and other payables 938 1,030
Cash movement from discontinued
operations - (112)
------------------------------------------- -------- --------
Cash generated from operations 59 (1,044)
Interest paid (118) (96)
Net cash from/(used in) operating
activities (59) (1,140)
------------------------------------------- -------- --------
Cash flows from investing activities
Purchases of property, plant and
equipment (260) (174)
Purchase of shares in subsidiary
companies (41) -
Net cash from/(used in) investing
activities (360) (174)
------------------------------------------- -------- --------
Cash flows from financing activities
------------------------------------------- -------- --------
Proceeds from issue of share capital - 396
------------------------------------------- -------- --------
Net cash inflow from financing activities - 396
------------------------------------------- -------- --------
Net (decrease)/increase in cash
and cash equivalents from continuing
operation (360) (918)
------------------------------------------- -------- --------
Total net (decrease) in cash and
cash equivalents (360) (918)
------------------------------------------- -------- --------
Cash and cash equivalents at the
beginning of the year (3,149) (2,231)
------------------------------------------- -------- --------
Cash and cash equivalents at the
end of the year (3,509) (3,149)
------------------------------------------- -------- --------
1. Corporate information and basis of preparation
RTC Group Plc is a public limited company incorporated and
domiciled in England whose shares are publicly traded. The
principal activities of the Group are described in note 4.
The announcement of results of the Group for the year ended 31
December 2012 was authorised for issue in accordance with a
resolution of the directors on 26 March 2013.
The financial information included in this announcement has been
compiled in accordance with the recognition and measurement
criteria of International Financial Reporting Standards ("IFRS"),
including International Accounting Standards ("IAS") and
interpretations issued by the International Accounting Standards
Board ("IASB") and its committees, and as adopted by the EU. This
announcement does not itself however contain sufficient information
to comply with IFRS.
The accounting policies adopted are consistent with those
described in the annual financial statements for the year ended 31
December 2012. There have been no significant changes in the basis
upon which estimates have been determined, compared to those
applied at 31 December 2011 and no change in estimate has had a
material effect on the current period.
2. Dividends
The Board do not recommend the payment of a final dividend for
the year.
3. Earnings per share
The calculation of basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year.
The calculation of diluted earnings per share is based on the
basic earnings per share adjusted to allow for all dilutive
potential ordinary shares.
The outstanding share options were not considered to be dilutive
in 2012 or 2011.
Basic Basic Diluted Diluted
2012 2011 2012 2011
Continuing operations
Earnings/(loss) GBP'000 474 (499) 474 (499)
Weighted average number
of shares 13,511,626 11,974,276 13,511,626 11,974,276
Earnings/(loss) per share
(pence) 3.51p (4.17p) 3.51p (4.17p)
Discontinued operations
Earnings/(loss) GBP'000 - (112) - (112)
Weighted average number
of shares - 11,974,276 - 11,974,276
Earnings/(loss) per share
(pence) - (0.93p) - (0.93p)
Continuing and discontinued operations
Earnings/(loss) GBP'000 474 (611) 474 (611)
Weighted average number
of shares 13,511,626 11,974,276 13,511,626 11,974,276
Earnings/(loss) per share
(pence) 3.51p (5.10p) 3.51p (5.10p)
4. Segment analysis
The Group is a provider of recruitment and conferencing services
and operates a division for each. The recruitment division
comprises three distinct business units - ATA Recruitment UK (ATA
UK) servicing the UK SME engineering market and a number of
vertical markets; ATA Global Supply Solutions (ATA GSS) servicing
the international market and Ganymede Solutions (GSL) supplying
blue collar labour into rail, trades and labour and other
markets.
Segmental information is provided below in respect of ATA UK,
ATA GSS, GSL and conferencing.
The Group manages the trading performance of each segment by
monitoring operating profit before exceptional items and centrally
manages working capital, borrowings and equity.
The Conferencing division services are wholly provided in the
UK. A growing proportion of the Recruitment division revenues now
derive from overseas activity.
Revenues are generated from permanent and temporary recruitment
in the Recruitment division and from the provision of a
conferencing and hotel facility in Derby for the Conferencing
division.
All revenues have been invoiced to external customers other than
GBP126,000 (2011: GBP90,000) within the Derby Conference Centre
which comprised rental income from other Group segments. During
2012, one customer in the ATA GSS segment contributed greater than
10% of that segment's revenues being GBP13.7m (2011: GBP8.2m).
The segmental information for the reporting period is as
follows:
ATA UK ATA GSS GSL DCC Total
Group
2012 2012 2012 2012 2012
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Segment continuing operations
Sales from external
customers 20,601 13,736 6,885 1,741 42,963
Cost of sales (18,292) (12,472) (6,228) (743) (37,735)
--------- --------- -------- -------- ---------
Segment gross profit 2,309 1,264 657 998 5,228
Administrative expenses (1,982) (1,141) (442) (922) (4,487)
Depreciation (75) - (14) (60) (149)
--------- --------- -------- -------- ---------
Segment operating profit 252 123 201 16 592
--------- --------- -------- -------- ---------
ATA UK ATA GSS GSL DCC Total
Group
2011 2011 2011 2011 2011
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Segment continuing operations
Sales from external
customers 15,825 8,239 4,843 1,763 30,670
Cost of sales (14,321) (7,537) (4,085) (725) (26,668)
--------- -------- -------- -------- ---------
Segment gross profit 1,504 702 758 1,038 4,002
Administrative expenses (1,651) (789) (578) (915) (3,933)
Depreciation (59) - (9) (88) (156)
--------- -------- -------- -------- ---------
Segment operating (loss)/profit
before exceptional items (206) (87) 171 35 (87)
Exceptional administrative
expense - - (378) - (378)
--------- -------- -------- -------- ---------
Segment operating (loss)/profit (206) (87) (207) 35 (465)
--------- -------- -------- -------- ---------
Certain 2011 figures have been restated. Recruitment revenue and
cost of sales have been grossed up in respect of billable travel
expenses of GBP1.15m in ATA GSS previously netted off. The
previously reported gross profit figure remains unchanged.
All assets and liabilities are held in the United Kingdom.
5. Exceptional administrative costs
2012 2011
GBP'000 GBP'000
Provision for bad debt - 378
--------- --------
- 378
---------------------------------- --------
During 2011 the Group experienced a non-recurring exceptional
bad debt of GBP378,000 including legal fees, from an isolated
customer and relating to the Group's entry into the Telecoms
sector. This business area was discontinued in 2011.
6. Income tax
Continuing operations 2012 2011
GBP'000 GBP'000
Analysis of tax :-
Current tax
UK corporation tax - -
Adjustment in respect of previous - -
periods
- -
Deferred tax
Origination and reversal of temporary
differences (107) (62)
Adjustment in respect of previous 6 -
periods
--------------------------------------- -------- --------
Tax (101) (62)
--------------------------------------- -------- --------
Factors affecting the tax expense
The tax assessed for the year is greater than would be expected
by multiplying profit on ordinary activities by the standard rate
of corporation tax in the UK of 24.5 % (2011: 26.5%). The
differences are explained below:-
2012 2011
GBP'000 GBP'000
Profit/(loss) on ordinary activities
before tax 474 (561)
Profit/(loss) multiplied by standard
rate of tax 116 (149)
Non-deductible expenses 17 21
Losses carried forward - 66
Utilisation of losses (240) -
Adjustment in respect of previous 6 -
periods
-------------------------------------- ------
Income Tax (credit) / charge
for the year (101) (62)
------------------------------------------------------ ----------------------- ------------------
Factors that may affect future tax charges
Estimated losses available to offset against future taxable
profits on continuing operations in the UK amount to approximately
GBP813,000 (2011: GBP1,329,000). The Chancellor of the Exchequer
has announced that the rate of corporation tax will be reduced each
year until 2015 when it will remain at 20%. In accordance with
relevant accounting standards, calculation of the deferred tax
asset is based on a tax rate of 23%, being the rate which was
enacted at the year-end date.
7. Report and accounts
The above financial information does not constitute the
Company's statutory accounts for the years ended 31 December 2012
or 2011 but is derived from those accounts. The auditor has
reported on these accounts; their report was unqualified, did not
draw any matters by way of emphasis without qualifying their report
and did not contain statements under s498 (2) or (3) Companies Act
2006 or equivalent preceding legislation. The statutory accounts
for 2011 have been filed with the Registrar of Companies.
Full audited accounts of RTC Group plc for the year ended 31
December 2012 will be made available on the Company's website at
www.rtcgroupplc.co.uk later today and will be dispatched to
shareholders week commencing 1 April 2013 and then be available
from the Company's registered office:- The Derby Conference Centre,
London Road, Derby, DE24 8UX.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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