2022 Audited Results

About this update from Staffline Group Plc

[{"type":"text","content":"\n \n \n 21 March 2023 \n \n   \n \n \n   \n \n \n STAFFLINE GROUP PLC \n \n (\"Staffline\", the \"Company\" or the \"Group\") \n   \n \n \n AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2022 \n \n \n \n \n   \n \n \n -     Strong performance across FY 2022 with underlying operating profit ahead of expectations \n -     Strong balance sheet, with net cash of £5.0m \n   \n Staffline Group plc, the recruitment and training group, announces its audited results for the year ended 31 December 2022 ('FY 2022'). \n   \n \n Financial Highlights 1 \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n FY 2022 \n \n \n \n \n \n FY 2021 \n \n \n \n \n Change \n \n \n \n \n \n \n \n Revenue \n \n \n \n \n \n \n £940.5m \n \n \n \n \n \n £942.7m \n \n \n \n \n -0.2% \n \n \n \n \n \n \n \n Gross sales value 2 \n \n \n \n \n \n \n £1,031.3m \n \n \n \n \n \n £996.5m \n \n \n \n \n +3.5% \n \n \n \n \n \n \n \n Gross profit \n \n \n \n \n \n \n £83.2m \n \n \n \n \n \n £82.8m \n \n \n \n \n +0.5% \n \n \n \n \n \n \n \n Gross margin % \n \n \n \n \n \n \n 8.8% \n \n \n \n \n \n \n 8.8% \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n Underlying operating profit 3 \n \n \n \n \n \n \n £12.0m \n \n \n \n \n \n £10.3m \n \n \n \n \n +16.5% \n \n \n \n \n \n \n \n Gross profit to underlying operating profit conversion % \n \n \n \n \n \n \n 14.4% \n \n \n \n \n \n \n 12.4% \n \n \n \n \n \n \n +2.0%pts \n \n \n \n \n \n \n \n \n Profit after tax \n \n \n \n \n \n \n £3.8m \n \n \n \n \n \n £1.6m \n \n \n \n \n +£2.2m \n \n \n \n \n \n \n \n Underlying EBITDA \n \n \n \n \n \n \n £17.6m \n \n \n \n \n \n £16.9m \n \n \n \n \n +0.7m \n \n \n \n \n \n \n \n Net cash 4 \n \n \n \n \n \n \n £5.0m \n \n \n \n \n \n £6.9m \n \n \n \n \n -£1.9m \n \n \n \n \n \n \n \n   \n \n \n \n \n \n 1 \n \n Presented on a continuing basis. \n \n \n \n \n \n \n \n Alternative performance measures \n \n \n \n \n \n 2 \n \n Gross sales value represents the fair value of the consideration received or receivable for the supply of services, including agency sales, (excluding fees)  which are subject to an IFRS 15 agency adjustment, net of value added tax, rebates and discounts \n \n \n \n \n \n  3 \n \n Underlying results exclude goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying charges \n \n \n \n \n \n 4 \n \n Presented on a pre-IFRS16 basis which excludes lease liabilities and also excludes refinancing costs \n \n \n \n \n   \n \n \n \n ·   \n Revenue broadly flat - strong permanent recruitment and customer wins in temporary recruitment, offset softer demand from customers previously benefitting from the pandemic as well as a weaker \n Skills division within PeoplePlus \n \n \n o  \n Gross sales value increased by 3.5% generated from organic growth and new business wins predominantly in the Group's managed service provision \n \n \n ·   \n Gross profit from Recruitment up 4.7% offsetting reduction in PeoplePlus, resulting in flat year-on-year gross margin of 8.8% \n \n \n o  \n Gross profit from permanent recruitment increased by 64.9% to £6.1m (2021: £3.7m), representing 7.3% of Group gross profit compared to 2.9% in 2020 \n \n \n ·   \n Gross profit to underlying operating margin conversion ratio increased strongly to 14.4% (2021: 12.4%) due to efficiencies and tight cost control \n \n \n ·   \n Underlying operating profit 3 marginally ahead of market expectations at £12.0m \n \n \n ·   \n Interest rate cap purchased in October 2021 significantly limited the increase in net finance costs, to £2.7m (2021: £2.4m) \n \n \n ·   \n Net cash \n \n 4 \n \n of £5.0m (2021: £6.9m) was materially ahead of expectations delivering a strengthened balance sheet with accretive trading cashflow \n \n \n o  \n Repayment of c.£12m of Covid-related government support and advance payments \n \n \n ·   \n The Group's strong balance sheet continues to support growth opportunities \n \n \n Operational Highlights \n \n \n   \n \n \n ·   \n Strong financial and operational performance across the Recruitment divisions: \n \n \n o  \n Secured new contracts with BMW and Sainsbury's/Argos, confirming Group's market leadership in blue-collar recruitment \n \n \n o  \n Contract extensions secured with Causeway Coast and Glens Borough Council in Northern Ireland and VINCI Construction UK supplying labour and managed services to the London to Southampton pipeline project \n \n \n o  \n Opened new office in Limerick, Republic of Ireland and launched new executive search service, further highlighting the Group's growth momentum in Ireland \n \n \n ·   \n PeoplePlus \n \n \n o  \n Delivered a solid performance from the Restart contracts, underpinned by first profit since inception in July 2021 of £1.2m \n \n \n o  \n Strong demand for labour resulted in potential candidates bypassing additional training programmes and moving straight into employment, which held back Skills division \n \n \n \n   \n \n \n \n Current Trading and Outlook \n \n \n ·   \n Staffline delivered a strong performance across FY 2022, exceeding original expectations in terms of both profitability and cashflow, despite facing challenging macroeconomic conditions, which management expect to continue across FY 2023 \n \n \n ·     \n The Group expects to grow market share across the temporary recruitment market, but anticipates short term market challenges within the retail and consumer sectors subduing growth in permanent recruitment with low unemployment trends expected to further constrain volumes within PeoplePlus' Skills and Restart businesses \n \n \n ·   \n As highlighted in the trading update in January 2023, the Board has adopted a cautious approach to FY 2023, however, the Group's strengthened balance sheet, experienced management team, and healthy pipeline mean the business is well placed to capitalise on the considerable market opportunities that lie ahead \n \n   \n   \n \n Albert Ellis, Chief Executive Officer, commented: \n \n   \n \n \"I am pleased to report such a strong trading performance across the Group in FY 2022, with Staffline increasing its overall profits and further strengthening its balance sheet. \n \n \n   \n \n \n In addition to these solid results, the Group secured two significant new contracts with BMW and Sainsbury's/ Argos, and extended important existing relationships with VINCI Construction UK and Causeway Coast and Glens Borough Council. Our experienced management and staff continue to ensure Staffline delivers an outstanding service in a tight labour market, further highlighting our credentials as the UK's preferred recruitment and training provider during this time of uncertainty. \n \n \n   \n \n \n \"As we move further into 2023, we will focus our efforts on delivering on the Group's organic growth pipeline and leveraging Staffline's leading market position to capitalise on a number of exciting new business opportunities and further expand our market share.\" \n \n \n \n   \n \n \n \n \n \n \n \n Staffline Group plc \n \n \n \n www.stafflinegroupplc.co.uk \n \n \n Albert Ellis, Chief Executive Officer \n Daniel Quint, Chief Financial Officer \n \n \n via Vigo Consulting \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Liberum Nominated Adviser and Joint Broker \n \n \n www.liberum.com \n \n \n Richard Lindley / William Hall \n \n   \n \n \n Zeus Joint Broker \n www.zeuscapital.co.uk \n David Foreman (Investment Banking) \n Nick Searle (Sales) \n \n \n 020 3100 2222 \n   \n   \n   \n 020 3829 5000 \n \n \n \n \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Vigo Consulting Investor Relations & Financial PR \n \n www.vigoconsulting.com \n \n Jeremy Garcia / Kate Kilgallen \n \n \n 020 7390 0230 \n [email protected] \n \n   \n \n \n \n \n \n \n \n   \n \n \n \n About Staffline - Recruitment, Training and Support \n \n   \n Enabling the Future of Work™ \n Staffline is the UK's market leading Recruitment and Training group. It has three divisions: \n   \n \n Recruitment GB \n \n Staffline is a leading provider of flexible blue-collar workers, supplying c.31,000 staff per day on average from around 400 sites, across a wide range of industries including supermarkets, drinks, driving, food processing, logistics and manufacturing. \n   \n \n Recruitment Ireland  \n \n The Recruitment Ireland business is a leading end to end solutions provider operating across twenty industries, ten branch locations and ten onsite customer locations, supplying c.4,500 staff per day on average, and offering RPO, MSP, temporary and permanent solutions across the island of Ireland. \n   \n \n PeoplePlus Division \n \n Staffline is the leading adult skills and training provider in the UK, delivering adult education, prison education and skills-based employability programmes across the country. \n   \n \n   \n \n \n   \n \n \n \n Chairman's Statement \n \n \n \n \n   \n \n \n \n \n Introduction \n \n \n \n This is my first statement as Interim Chairman and I would like to take this opportunity to express my passion for ensuring the Staffline Group communicates as effectively as possible regarding our strategy, operational progress, and crucially, the financial health of our business going forward. I believe all shareholders should remain fully informed about the growth plans and ambitions of the Group, so they continue to have confidence in Staffline as an investment. \n \n \n \n Year in Review \n \n \n \n The Group's performance over the last 12 months has been strong. We delivered on our promise to grow underlying operating profit to £12.0m (2021: £10.3m), which is up 16.5% on the prior year. Equally importantly, we further strengthened the balance sheet with tight management of working capital, control of costs and capital expenditure, and through retaining our trading cash flow to finance future growth. \n \n \n As of 31 December 2022, the Group is operating with significant financing headroom relative to available committed banking facilities. I have long been a strong advocate of prudent cash management, making sure the business remains self-financing and avoiding an over-reliance on external borrowing. \n \n \n I firmly believe that Staffline has the means and expertise to both protect, and indeed expand, its enviable market position. Management is highly in tune with the individual workings of each of our divisions and, rest assured, will act decisively to redeploy capital, be this to new activities, or to existing operations with historically higher margins, to ensure continued progress across the Group. Our investors rightly seek value, and we, as a Board and management team, are working hard to deliver enhanced shareholder value. \n \n \n \n Dividends & Capital Allocation \n \n \n \n Our capital allocation policy will be guided by the macro-environment in which we operate, we will strive first and foremost to maintain the strength of our balance sheet and deliver long-term value for our shareholders, considering share buybacks or dividends as and when appropriate to do so. With regard to any acquisitions or organic investment in the business, the Board will seek to finance these through trading cash flow alone, as opposed to assuming fixed term debt. \n \n \n \n Board Changes \n \n \n \n In March 2022, Richard Thomson advised the Board that he would not stand for re-election as Senior Independent Director, leaving in May to pursue other opportunities after three years of exceptional service to the Company. May 2022 also saw the departure of our former Chairman Ian Lawson, who resigned after two years spent expertly guiding the business through a period of significant change. In addition, Ian Starkey, Senior Independent Director, informed the Board in November 2022 that he will not stand for re-election at the Group's AGM in 2023. Ian has been a tremendous asset to the business both in his capacity as Chair of the Audit Committee, and more recently as a Senior Independent Director, supporting the Group through its 2021 refinancing, transformation, and return to growth. On behalf of the Board, I extend our sincere thanks to each of them for the truly instrumental roles they have played in transforming Staffline into the strong and resilient business we see today. We wish them every success in the future. \n \n \n \n Closing remarks \n \n \n \n I would like to thank my extraordinary colleagues at Staffline who continue to deliver excellent results, as well as our Managing and Executive Directors. I believe we are privileged to have such a strong and experienced operational team supported by top-quality talent at the senior leadership level. One of my first priorities when I assumed the role of Interim Chairman was to ensure that our talent was retained and locked in through a variety of incentives both short and long term, aligning the interests of management with the Group's shareholders and ensuring we have the bench strength to execute on our plans. \n \n \n Ultimately, we are not just a people business, we are a people-focused business; striving to match rewarding work opportunities with those that seek them. Our passion for helping our extraordinary clients achieve their objectives through first-class recruitment is evidenced by both the enduring relationships we have forged with so many of our partners, and our ability to consistently secure top-level client wins. \n \n \n In the new financial year, it is clear there are a number of external headwinds we will have to navigate. Despite this testing macro environment, I remain hugely encouraged by the nature of our business mix, which I believe leaves Staffline well equipped to face these challenges head-on and take advantage of the opportunities they present. \n \n \n   \n \n \n   \n \n \n \n Tom Spain \n \n \n \n \n Interim Chairman \n \n \n \n 20 March 2023 \n \n \n   \n \n \n \n   \n \n \n \n \n Chief Executive Officer's Review \n \n \n \n \n   \n \n \n \n \n Introduction \n \n \n \n   \n \n \n The Group traded strongly across 2022, and I am delighted that the increased gross sales and client activity throughout FY 2022 has resulted in a positive flow through to operating profit and trading cash flows. We continue to see the benefits of the restructuring and significant strengthening of the Group's balance sheet achieved in the previous year.  As a result, the Group delivered an excellent trading performance with increases in the Group's gross profit, operating profit, conversion ratios and profit before tax. \n \n \n   \n \n \n Following the pandemic-related volatility of the past couple of years, 2022 continued to provide eventful  macroeconomic conditions. The global economy was hit hard by geopolitical uncertainty across the world, with sharp rises in interest rates and faster than expected inflation reducing consumers' disposable income all contributing to a slowing macroeconomic environment. \n \n \n   \n \n \n Nevertheless, despite the challenges facing the Group, I am pleased to report our businesses have proven highly resilient. Our commitment to delivering excellent customer service at scale, in a tight labour market, has proven to be a key differentiator and our management have forged even stronger relationships with the Group's customers. \n \n \n   \n \n \n In the year ended 31 December 2022, the Group generated revenues of £940.5m (2021: £942.7m), and a 0.5% increase in gross profit to £83.2m (2021: £82.8m). Underlying 1 operating profit increased 16.5% to £12.0m (2021: £10.3m), with net cash (pre-IFRS 16) 2 as at 31 December of £5.0m (2021: net cash £6.9m). \n \n \n   \n \n \n This success could not have been achieved without the outstanding quality of our people. During 2022 we refreshed and reorganised our management and organisational structure, bringing exceptional talent into the Group whilst promoting high performers from within the business. The rollout of performance related compensation and long-term equity plans has further reduced churn and attracted and retained the best people in preparation for the growth journey over the next 3-5 years. \n \n \n   \n \n \n The business has moved from strength to strength in financial terms too. In particular, our excellent Finance team has worked hard to convert our trading profits into cash through tight control of debtors and implementing significant cost-saving initiatives, resulting in a real term reduction in the Group's cost base. The interest rate cap purchased in October 2021 has delivered significant interest savings and all outstanding historic Covid-related liabilities have been settled over the course of the year. \n \n \n   \n \n \n \n A year of positive momentum \n \n \n \n   \n \n \n I am pleased to say that 2022 can be characterised as a year of consistent, positive growth momentum for Staffline. \n \n \n   \n \n \n Group gross profit grew by 0.5%, largely attributable to the onboarding of two significant new recruitment customers, the first profit from our Restart contract, and solid trading across the Christmas peak period. Our strategy of growing higher margin, cash generative permanent recruitment contracts (up 65% compared with 2021), continues to yield positive results; driving further increases in revenue, as well as improvements to our cash position. \n \n \n   \n \n \n Within PeoplePlus, offsetting the weakness in the Skills business, which was due to high employment, robust demand for labour supported a strong performance for our employability programmes, and we were pleased to see the division recognise its first operating profit from its Restart sub-contracts during the second half. \n \n \n   \n \n \n As announced in H1 2022, Recruitment GB successfully secured several substantial new contracts, including a \n long-term agreement with BMW Group to supply the flexible operational workforces and a number of specialist roles for its manufacturing sites in England. \n \n \n   \n \n \n T \n he division's \n managed services arm, Datum RPO, \n has delivered an impressive performance, with record results driven by consistently high levels of demand for its services. New business wins include \n a \n five-year contract extension with specialist construction company, VINCI Construction UK, as well as the onboarding of new customer Argos, part of the Sainsbury's Group, which appointed Datum RPO i \n n early 2022 as its \n temporary labour Managed Service Provider ('MSP') for its sizeable driving estate. \n \n \n   \n \n \n The senior team at Datum RPO has committed significant time and resource to developing the business' technology platform to meet Argos' specific requirements, seamlessly rolling out its MSP solution across 45 locations and Argos' 70 -strong supplier network. Following on from this success, Staffline has since become a specialist supplier of driver resource for key locations within Argos' home delivery network. \n \n \n   \n \n \n Recruitment Ireland saw strong traction in its permanent recruitment business, including for the first time in the executive search sector, and expanded its branch network in the Republic of Ireland where it opened a new office in Limerick and extended its Causeway Coast and Glens Borough Council contract for a further 5 years. Tight cost control and an increase in gross margins led to an increase in gross profit to operating profit conversion rate to 24.8%, up from 22.1% in the year prior. \n \n \n   \n \n \n As we move further into 2023, management will focus its efforts on delivering additional organic growth across the Group through both increasing business volumes in existing customers, and by leveraging Staffline's enviable market position to capitalise on new business opportunities and further expand our market share. \n \n \n   \n \n \n \n Vision and strategy \n \n \n \n \n   \n \n \n \n Staffline's business vision is clear: to be a market leading, world-class recruitment and training group, known for excellent service and integrity, and driven by digital innovation. Our strategic priorities for consistent, sustainable growth are as follows: \n \n \n   \n \n \n ·     \n \n To further capitalise on the Group's market leadership in recruitment: \n \n \n \n Staffline's Recruitment divisions have market leading positions in the supply of temporary workers, especially in the blue-collar warehouse and driving sectors. Our focus now is on securing additional organic growth in new and existing clients which are actively growing their own market share, and also introducing permanent recruitment services to support our clients' core headcount requirements. The Group's strong governance and compliance offer will be increasingly important going forward. \n \n \n   \n \n \n ·   \n \n To broaden the portfolio of services: \n \n \n \n The Group will continue to introduce Datum RPO's services to customers that will benefit from a fully managed service and we believe the current push for cost savings is a key driver in increasing client demand in this market. The Group will support Omega's ambitions to grow its technical and engineering niche, which will expose the Group to higher margin growth opportunities in the white-collar recruitment sector. \n \n \n   \n \n \n ·   \n \n To drive ongoing profit growth within PeoplePlus: \n \n \n \n Our strategy remains focused on further stabilising the annuity revenue and profit streams of the business, winning new contracts and consolidating our market share in prison education and employability. \n \n \n   \n \n \n ·   \n \n To grow in the Republic of Ireland: \n \n \n \n The Republic of Ireland continues to be an attractive recruitment market with a positive growth outlook. The Group is growing through investing in additional branches and services, and hiring additional fee-earning headcount including during the current downturn. We believe these initiatives will help facilitate a step change in scale and profitability in the recovery when it comes. \n \n \n   \n \n \n \n Operational review \n \n \n \n \n Recruitment GB \n \n \n \n   \n \n \n The Group's Recruitment GB division delivered a strong performance across 2022 having successfully expanded its operational footprint during the period.  The implementation of the BMW contract, a major win in 2022, remains ongoing, with the Group seeing further momentum from additional sectors, including manufacturing and travel. Investment in headcount and technology remained a key theme for the business, and despite much reported labour shortages, the division continued to expand its branch network, reinforcing the strong platform which will underpin future growth. The Group's managed services business, Datum RPO, continued to perform well as customers seek to consolidate their recruitment supply chains using an independent expert, as evidenced by the award of a \n five-year contract extension with VINCI Construction UK. \n Omega, the Group's technical and engineering recruiter, also posted strong increases in its permanent recruitment fees, which across the wider division were up c.80% over 2021, representing a c.176% increase over the last two years. The division continued to control overhead costs tightly, increasing its gross profit to underlying operating profit conversion rate from 14.0% to 16.0%. \n \n \n   \n \n \n \n Recruitment Ireland \n \n \n \n   \n \n \n The Recruitment Ireland business, which is more dependent on the permanent recruitment market and less dependent upon temporary placements than the Recruitment GB business, produced an excellent trading performance across the year. The division delivered a 45% increase in permanent recruitment fees, its strongest results since 2019, which offset marginally weaker blue-collar demand. The increase in permanent recruitment fees, coupled with a record trading performance in the Republic of Ireland, which has been underpinned by ongoing investment in fee-earning headcount, further demonstrates the inherent strength of our Recruitment Ireland platform. A pivot to white-collar recruitment in the Republic of Ireland, the opening of a new office in Limerick, and the retention of key public sector contracts in Northern Ireland, all contributed to record growth across 2022. The strength of permanent recruitment, and for the first time, executive search, helped increase gross margins. Additionally, our entry into the executive search market alongside tight control of the cost base resulted in the gross profit to underlying operating profit conversion rate improving to 24.8%, up from 22.1% in the prior year. \n \n \n   \n \n \n \n PeoplePlus \n \n \n \n \n   \n \n \n \n PeoplePlus reported a solid performance in 2022, but as expected was held back by lower revenues in Skills training. Labour shortages, and the resulting demand squeeze, resulted in potential candidates bypassing established training programmes and moving straight into employment. Conversely, these labour market conditions aided our Employability programmes which performed particularly well, and we were pleased to see PeoplePlus successfully deliver profit from the Restart sub-contracts during the year, with the division reporting its first operating profit from those contracts in the second half of 2022. During the year it was determined that PeoplePlus had overstated revenues totalling £2.6m in relation to the period prior to 31 December 2021, as PeoplePlus had not met some of its revenue related performance obligations. Due to the legacy nature of these revenues, management have accounted for the adjustment of these errors through reserves.  \n \n \n   \n \n \n \n The labour market and recruitment landscape \n \n \n \n   \n \n \n The labour market experienced severe shortages which were exacerbated by the Covid pandemic. Since then, we have seen a slight easing in supply but also in demand, particularly in HGV driving. The logistics and online sector which reported buoyant results during the Covid related lockdowns has reduced demand for temporary labour as online volumes returned to more normalised levels and consumers reverted to pre-pandemic behaviours. However, the labour shortage continues as vacancies remain above 1 million and combined with the cost-of-living crisis, this has affected the training market as candidates are going straight into paid work without seeking additional training. The Group has responded to these changes by reducing its cost base in Skills to align with the forecasted lower level of demand going forward, and by reorganising its labour delivery to leverage the Group's strengths in regional differences in supply and demand. \n \n \n \n   \n \n \n \n \n Board Changes \n \n \n \n   \n \n \n In May 2022, Tom Spain was appointed Interim Chairman following the announcement that Ian Lawson would step down from his role as Non-Executive Chairman.  Additionally, in April 2022, Richard Thomson stepped down from the Board as the Senior Independent Director, a role assumed by Ian Starkey in May 2022. \n \n \n   \n \n \n In November 2022, we announced that Ian Starkey, Audit Chairman and Senior Independent Director, had informed the Company that he would not be standing for re-election at the 2023 AGM. Accordingly, \n the Board has begun the process of searching for a replacement. The search is at an advanced stage and the Board expects to make an announcement shortly. \n \n \n   \n \n \n \n Outlook \n \n \n \n   \n \n \n As a business, we are pleased with the excellent progress delivered by Staffline across 2022, achieving strong growth in profitability and cash flows, investing in the senior operational leadership, and embedding governance at the core of our company culture to further differentiate our customer offering in a market that is increasingly prioritising compliance. \n \n \n   \n \n \n As referenced in our January 2023 trading update, we anticipate the current uncertainty to persist through 2023, with continuing low unemployment constraining volumes within PeoplePlus's Skills and Restart businesses. Our Recruitment GB and Recruitment Ireland divisions are likely to be affected by the widely reported weakening in demand for permanent hiring. \n \n \n   \n \n \n However, we are confident in our ability to leverage our brand, geographic scale and governance advantage to continue to expand our market share in preparation for the economic recovery when it comes. \n \n \n   \n \n \n \n Albert Ellis \n \n \n \n \n Chief Executive Officer \n \n \n \n 20 March 2023 \n \n \n   \n \n \n \n Alternative performance measures \n \n \n \n \n \n 1 \n \n Underlying results exclude goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying charges \n \n \n \n \n \n 2 \n \n Presented on a pre-IFRS16 basis, which excludes lease liabilities, and also excludes refinancing costs \n \n \n \n \n   \n \n \n \n \n \n \n \n Financial Review \n \n \n \n   \n \n \n \n Introduction \n \n \n \n The Group traded strongly during 2022 and exceeded both net cash and underlying operating profit expectations, despite the continuing economic challenges. Gross sales for 2022 increased by 3.5% to £1,031.3m (2021: £996.5m) driven by new managed service provider customer wins. Total revenue for the year of £940.5m (2021: £942.7m) was lower than the previous year by 0.2%. Gross profit across the recruitment businesses increased by 4.7% to £64.9m (2021: £62.0m), offset by a reduction in PeoplePlus' gross profit to £18.3m (2021: £20.8m). This resulted in Group gross profit increasing to £83.2m (2021: £82.8m), with gross profit margin stable at 8.8%. The Group continued to control overhead costs tightly, increasing its gross profit to underlying operating profit conversion rate from 12.4% to 14.4%, delivering a 16.5% increase in underlying operating profit to £12.0m (2021: £10.3m). The Group's reported profit after tax increased to £3.8m (2021: £1.2m). \n \n \n The Group has pursued a policy of organic growth with a focus on cost control and working capital, conserving its cash reserves, and further strengthening its balance sheet. The Group ended the year with pre-IFRS16 net cash of £5.0m (2021: £6.9m), notwithstanding the two Covid-19 pandemic-related one-off payments of the final repayment of deferred VAT of £5.8m and £6.2m advance payments from the Ministry of Justice. This means that the Group generated an underlying improvement in net cash of £10.1m. \n \n \n The Group's purchase of a 3-year interest rate cap in October 2021, in order to manage its debt financing costs, meant that the impact of the increase in the Bank of England base rate from 0.25% to 3.50% during 2022 was largely mitigated. \n \n \n The Group's strengthened balance sheet and its significant financing headroom leaves it well placed to navigate the ongoing global macroeconomic headwinds as well as capitalise on market opportunities to further grow market share. \n \n \n The Group comprises three divisions, namely, Recruitment GB, flexible blue-collar recruitment; Recruitment Ireland, generalist recruitment; and PeoplePlus, adult skills and training provision. \n \n \n Underlying 1 divisional performance - continuing operations \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Recruitment GB \n \n \n  2022 \n \n \n  m \n \n \n \n \n Recruitment Ireland \n \n \n  2022 \n \n \n  m \n \n \n \n \n PeoplePlus 2022 \n \n \n £m \n \n \n \n \n Group Costs 2022 \n \n \n £m \n \n \n \n \n Total Group \n \n \n 2022 \n \n \n  m \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2021 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n Ireland \n \n \n 2021 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2021 \n \n \n £m \n \n \n \n \n Group Costs \n \n \n 2021 \n \n \n £m \n \n \n \n \n Total Group \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Revenue \n \n \n \n \n 752.0 \n \n \n \n \n 110.6 \n \n \n \n \n 77.9 \n \n \n \n \n - \n \n \n \n \n 940.5 \n \n \n \n \n 747.9 \n \n \n \n \n 111.7 \n \n \n \n \n 83.1 \n \n \n \n \n - \n \n \n \n \n 942.7 \n \n \n \n \n \n \n Year-on-year revenue increase/(decline) \n \n \n \n \n 0.5% \n \n \n \n \n (1.0)% \n \n \n \n \n (6.3)% \n \n \n \n \n - \n \n \n \n \n (0.2)% \n \n \n \n \n 2.2% \n \n \n \n \n (7.3)% \n \n \n \n \n 10.8% \n \n \n \n \n - \n \n \n \n \n 1.6% \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Gross sales value 3 \n \n \n \n \n 842.8 \n \n \n \n \n 110.6 \n \n \n \n \n 77.9 \n \n \n \n \n \n \n \n \n \n \n \n 1031.3 \n \n \n \n \n 801.7 \n \n \n \n \n 111.7 \n \n \n \n \n 83.1 \n \n \n \n \n \n \n \n \n \n \n \n 996.5 \n \n \n \n \n \n \n Year-on-year gross sales value increase \n \n \n \n \n 5.1% \n \n \n \n \n (1.0)% \n \n \n \n \n (6.3)% \n \n \n \n \n - \n \n \n \n \n 3.5% \n \n \n \n \n 5.6% \n \n \n \n \n (7.3)% \n \n \n \n \n (10.8)% \n \n \n \n \n - \n \n \n \n \n 2.7% \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Gross profit \n \n \n \n \n 52.0 \n \n \n \n \n 12.9 \n \n \n \n \n 18.3 \n \n \n \n \n - \n \n \n \n \n 83.2 \n \n \n \n \n 50.7 \n \n \n \n \n 11.3 \n \n \n \n \n 20.8 \n \n \n \n \n - \n \n \n \n \n 82.8 \n \n \n \n \n \n \n Year-on-year gross profit increase/(decline) \n \n \n \n \n 2.6% \n \n \n \n \n 14.2% \n \n \n \n \n (12.0)% \n \n \n \n \n - \n \n \n \n \n 0.5% \n \n \n \n \n 9.7% \n \n \n \n \n 7.6% \n \n \n \n \n 16.2% \n \n \n \n \n - \n \n \n \n \n 11.0% \n \n \n \n \n \n \n Gross profit as a % of revenue \n \n \n \n \n 6.9% \n \n \n \n \n 11.7% \n \n \n \n \n 23.5% \n \n \n \n \n - \n \n \n \n \n 8.8% \n \n \n \n \n 6.8% \n \n \n \n \n 10.1% \n \n \n \n \n 25.0% \n \n \n \n \n - \n \n \n \n \n 8.8% \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Underlying operating profit/(loss) before tax \n \n \n \n \n 8.3 \n \n \n \n \n 3.2 \n \n \n \n \n 3.8 \n \n \n \n \n (3.3) \n \n \n \n \n 12.0 \n \n \n \n \n 7.1 \n \n \n \n \n 2.5 \n \n \n \n \n 4.1 \n \n \n \n \n (3.4) \n \n \n \n \n 10.3 \n \n \n \n \n \n \n Underlying operating profit as a % of revenue \n \n \n \n \n 1.1% \n \n \n \n \n 2.9% \n \n \n \n \n 4.9% \n \n \n \n \n - \n \n \n \n \n 1.3% \n \n \n \n \n 0.9% \n \n \n \n \n 2.2% \n \n \n \n \n 4.9% \n \n \n \n \n - \n \n \n \n \n 1.1% \n \n \n \n \n \n \n Underlying operating profit as a % of gross profit \n \n \n \n \n 16.0% \n \n \n \n \n 24.8% \n \n \n \n \n 20.8% \n \n \n \n \n - \n \n \n \n \n 14.4% \n \n \n \n \n 14.0% \n \n \n \n \n 22.1% \n \n \n \n \n 19.7% \n \n \n \n \n - \n \n \n \n \n 12.4% \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Pre-IFRS 16 2 net cash excluding unamortised refinancing costs \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 5.0 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 6.9 \n \n \n \n \n \n \n Post-IFRS 16 net cash excluding \n unamortised refinancing costs \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.1 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 2.3 \n \n \n \n \n \n \n Key performance indicators - continuing operations \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Recruitment GB \n \n \n 2022 \n \n \n \n \n Recruitment Ireland \n \n \n 2022 \n \n \n \n \n PeoplePlus 2022 \n \n \n \n \n Total \n \n \n Group \n \n \n 2022 \n \n \n \n \n Recruitment GB \n \n \n 2021 \n \n \n \n \n Recruitment Ireland \n \n \n 2021 \n \n \n \n \n PeoplePlus 2021 \n \n \n \n \n Total Group \n \n \n 2021 \n \n \n \n \n \n \n Hours worked by temporary workers \n \n \n \n \n 44.0m \n \n \n \n \n 6.7m \n \n \n \n \n - \n \n \n \n \n 50.7m \n \n \n \n \n 51.1m \n \n \n \n \n 7.1m \n \n \n \n \n - \n \n \n \n \n 58.2m \n \n \n \n \n \n \n Gross profit per fee earner \n \n \n \n \n £76.5k \n \n \n \n \n £102.2k \n \n \n \n \n - \n \n \n \n \n £80.6k \n \n \n \n \n £71.5k \n \n \n \n \n £111.5k \n \n \n \n \n - \n \n \n \n \n £76.5k \n \n \n \n \n \n \n Revenue per employee \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n £55.7k \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n £62.6k \n \n \n \n \n - \n \n \n \n \n \n   \n \n For management reporting purposes the Recruitment GB division presents its 'gross sales value', which includes sales under agency arrangements. The reporting of gross sales gives an indication of the full level of activity undertaken by the division. This value is adjusted for reporting revenue in accordance with IFRS 15. The adjustment relative to reported revenue for the Group is as follows: \n \n \n \n \n \n \n \n \n \n \n \n \n \n 2022 \n \n \n  m \n \n \n \n \n 2021 \n \n \n  m \n \n \n \n \n \n \n Gross sales value \n \n \n \n \n 1,031.3 \n \n \n \n \n 996.5 \n \n \n \n \n \n \n Agency sales excluding fees \n \n \n \n \n \n (90.8) \n \n \n \n \n \n \n (53.8) \n \n \n \n \n \n \n \n Revenue as reported \n \n \n \n \n 940.5 \n \n \n \n \n \n 942.7 \n \n \n \n \n \n \n \n   \n \n \n Alternative performance measures \n \n \n 1   Underlying results exclude goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying charges. \n \n \n 2   Presented on a pre-IFRS 16 basis, which excludes lease liabilities, and also excludes refinancing costs. \n \n \n 3  Gross sales value represents the fair value of consideration received or receivable for the supply of servicess, including agency sales, (excluding fees)  net of VAT. \n \n \n \n \n \n Recruitment GB \n \n \n Revenues in the Recruitment GB division increased by £4.1m to £752.0m. The division experienced some reduction of volumes from retail and logistics customers that had benefited from increased workload during the Covid-19 pandemic, which was more than offset by significant new contracts, and increased demand from some existing customers, BMW and Sainsbury's/Argos being prominent examples. \n \n \n Gross profit of £52.0m (2021: £50.7m) resulted in gross profit margin increasing to 6.9% (2021: 6.8%), reflecting the slight shift from lower margin sectors such as food production, toward marginally higher returns from recovering sectors such as travel and aviation, as well as the increase in permanent recruitment activity commented on below. Increases in general pay rates, in many cases double-digit percentages, combined with the increase in the National Minimum Wage in April 2022, from £8.91 to £9.50 per hour for over 23's, does not impact absolute gross profit but does negatively impact gross margin percentage achieved. \n \n \n Gross profit generated from temporary recruitment reduced as a proportion of the total to 92.5% (2021: 95.7%), with the remaining 7.5% (2021: 4.3%) of gross profit generated from permanent recruitment. This represented a 77% increase in gross profit generated from permanent recruitment to £3.9m (2021: £2.2m). Hours worked reduced to 44.0m (2021: 51.1m) reflecting reduced year-over-year supermarket and online retail volumes and the strategic exit from a significant high volume, low margin contract during 2021. Revenues were boosted in the second half by the successful implementation of the new contract with BMW Group, whilst also generating strong organic growth with existing customers. The division continued to control overhead costs tightly, increasing its gross profit to underlying operating profit conversion rate from 14.4% to 16.0%, delivering a 16.9% increase in underlying operating profit to £8.3m (2021: £7.1m). \n \n \n \n Recruitment Ireland \n \n \n \n Revenues in the Recruitment Ireland division reduced by £1.1m to £110.6m, reflecting the reduction in temporary worker hours to 6.7m (2021: 7.1m). A 45% increase in permanent recruitment fees enabled the division to deliver its strongest results since 2019, as well as a record trading performance in the Republic of Ireland. \n \n \n Gross profit of £12.9m (2021: £11.3m) resulted in gross profit margin increasing to 11.7% (2021: 10.1%), reflecting the further shift toward permanent recruitment business. Gross profit generated from temporary recruitment accounted for 82.9% (2021: 86.7%) of the total, with the remaining 17.1% (2021: 13.3%) of gross profit generated from permanent recruitment. \n \n \n Additionally, tight control of the cost base resulted in the gross profit to underlying operating profit conversion rate improving to 24.8%, up from 22.1% in the prior year, generating an underlying operating profit of £3.2m (2021: £2.5m). \n \n \n PeoplePlus \n \n \n PeoplePlus revenues reduced by 6.3%, from £83.1m to £77.9m, primarily as a result of reduced revenues from Skills training, which was severely impacted by a significant reduction in the number of candidates available as a result of the tight labour market which enabled workers to enter jobs without workplace skills training. The division successfully delivered its first operating profit of £1.2m from the Restart sub-contracts in the second half of the year and the tight labour market conditions aided other Employability programmes, which performed well. \n \n \n Following the rebuild of the division's overhead base that commenced in 2021, the division has maintained its revenue to operating profit conversion at 4.9%, resulting in underlying operating profit of £3.8m (2021: £4.1m). \n \n \n During the year it was determined that PeoplePlus had overstated revenues totalling £2.6m in relation to the period prior to 31 December 2021, as PeoplePlus had not met some of its revenue related performance obligations. Due to the legacy nature of these revenues, management have accounted for the adjustment of these errors through reserves, \n (see note 3). \n \n \n   \n \n \n Revenue per employee was £55.7k during 2022 (2021: £62.6k), an 11% decrease, resulting from the reduced revenues from Skills training. PeoplePlus achieved a gross margin of 23.5% in 2022, which compares to 25.0% in 2021, largely due to the reduced contribution from skills training. \n \n \n Group costs \n \n \n Group costs, which include Directors' remuneration costs, have decreased to £3.3m (2021: £3.4m) reflecting continued close management of corporate spend. \n \n \n Group result \n \n \n Underlying operating profit was £12.0m (2021: £10.3m), an increase of 16.5%, and marginally ahead of market expectations for the year. Total non-underlying charges on continuing activities before tax, which are described below, were £7.4m (2021: £8.0m), which was all non-cash. \n \n \n The underlying profit before taxation on continuing operations for 2022 was £9.3m (2021: £7.9m). Underlying profit before taxation as a percentage of revenue was 1.0% (2021: 0.8%). The underlying profit after tax on continuing operations for the year was £9.4m (2021: £8.7m). \n \n \n The Group's reported profit before taxation was £1.9m in the year (2021: loss £(0.1)m). \n \n \n Net Finance Charges \n \n \n Net finance charges incurred in the year amounted to £2.7m (2021: £2.4m), reflecting part of the increase in overnight SONIA rates during 2022 from c.0.25% to c.3.40%. However, the Group limited its exposure to these interest rate increases through the use of an interest rate cap, which was purchased in October 2021. This reduces exposure to interest rate increases above 1% of SONIA on an aggregated two-thirds of the Receivables Finance Agreement (£26.0m at 31 December 2022) and the customer finance arrangements (£51.7m at 31 December 2022). The instrument, which has a term of three years from 13 October 2021, is based on quarterly notional amounts varying between £39.5m and £62.5m, with an average of £51.9m. \n \n \n Taxation \n \n \n The total tax credit for the year was £1.9m (2021: £1.7m), which included the movement of deferred tax balances. The Group has an estimated current corporation tax liability of £0.1m (2021: £nil) in respect of the year. Remaining tax losses of £17.8m carried forward in all divisions have been recognised as a deferred tax asset. \n \n \n The amortisation charge relating to intangible assets arising on business combinations is not deductible under UK corporation tax and is therefore added back to taxable profits. A deferred tax liability is recognised in respect of other intangible assets. This liability is reduced each year in line with the amortisation charge, giving rise to a deferred tax credit each year. \n \n \n Alternative Performance Measures \n \n \n In the reporting of its financial performance, the Group uses a limited number of alternative performance measures that are not defined under IFRS, the Generally Accepted Accounting Principles (\"GAAP\") under which the Group reports. The Directors believe that these non-GAAP measures assist with the understanding of the performance of the business and are not given undue prominence in these financial statements. These non-GAAP measures are not a substitute for, or superior to, any IFRS measures of performance, but they have been included as an additional means of comparing performance year-on-year. \n \n \n Non-underlying Items \n \n \n Non-underlying items of income or expenditure are items that are either non-recurring or of a particular size or nature such that they require separate identification. Non-underlying items are included in total reported results but are excluded from underlying results. Certain items can vary significantly from year to year and therefore create volatility in reported earnings. It should be noted that whilst the amortisation of intangible assets arising on business combinations has been added back, the revenue from those acquisitions has not been eliminated. \n \n \n Non-underlying charges on continuing activities before tax amounted solely to £7.4m in the year (2021: £8.0m), relating solely to amortisation of intangible assets arising on business combinations. As stated below the existing intangible assets on business combinations will all be fully amortised by the end of 2023. \n \n \n The charge in the year for amortisation of intangible assets arising on business combinations relates to the following acquisitions: Vital Recruitment (charge £3.0m: asset will be fully amortised by February 2023), Passionate about People (charge £2.3m: asset will be fully amortised by October 2023), Grafton (£1.3m: asset will be fully amortised by June 2023), Brightwork (charge £0.2m: asset fully amortised during 2022), others (charge £0.6m: asset fully amortised during 2022). \n \n \n \n \n \n \n Non-underlying charges - continuing operations \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n Amortisation of intangible assets arising on business combinations \n \n \n \n 7.4 \n \n \n \n 8.0 \n \n \n \n \n   \n \n Government Support \n \n \n During the first year of the Covid-19 pandemic in 2020, the Group took advantage of the forbearance scheme for the deferral of VAT due between March and June 2020. The total deferral agreed with HMRC under the UK scheme amounted to £42.4m after offset of a corporation tax refund due in relation to the financial year 2018. Repayment of the balance commenced in June 2021 and the final instalment of £5.8m was paid in January 2022. \n \n \n Earnings Per Share \n \n \n Statutory basic and diluted loss per share on continuing activities in 2022 were both 2.3p (2021: both 1.3p). \n \n \n For the year, the weighted average number of shares (basic) is 163,753,217 (2021: 122,178,126). \n \n \n Removing the non-underlying charges, and their respective taxation impacts, results in underlying basic earnings per share of 5.7p (2021: 7.1p) and diluted earnings per share of 5.7p on continuing activities (2021: 7.1p). \n \n \n \n \n \n The table below reconciles underlying EBITDA (earnings before interest, taxation, depreciation and amortisation), on continuing operations to operating profit. \n \n \n \n \n \n \n Reconciliation of operating loss to EBITDA \n \n \n \n \n 2022 £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Operating profit \n \n \n \n \n \n 4.6 \n \n \n \n \n \n 2.3 \n \n \n \n \n \n \n Non-underlying costs \n \n \n \n \n 7.4 \n \n \n \n \n 8.0 \n \n \n \n \n \n \n Underlying operating profit \n \n \n \n \n 12.0 \n \n \n \n \n 10.3 \n \n \n \n \n \n \n Depreciation and loss on disposals \n \n \n \n \n \n 5.6 \n \n \n \n \n \n 6.6 \n \n \n \n \n \n \n Underlying EBITDA \n \n \n \n \n 17.6 \n \n \n \n \n 16.9 \n \n \n \n \n \n \n Lease rental payments \n \n \n \n \n (1.6) \n \n \n \n \n (1.7) \n \n \n \n \n \n \n Underlying EBITDA (pre-IFRS 16) \n \n \n \n \n 16.0 \n \n \n \n \n 15.2 \n \n \n \n \n \n   \n \n Note: Underlying operating profit is before goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying costs. EBITDA represents Earnings Before Interest, Taxation, Depreciation and Amortisation. \n \n \n Statement of Financial Position, Cash Generation and Financing \n \n \n Since 2020 strong trading cash flows, alongside the equity raise in 2021 have increased the Group's equity by £54.1m to £71.7m. \n \n \n The movement in net debt is shown in the table below. Strong trading cash flows were offset by working capital movements, which included the final repayments of deferred VAT of £5.8m and £6.2m of Covid-19 related advance payments from the Ministry of Justice. \n \n \n   \n \n \n \n \n \n \n Movement in net debt \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Opening net cash/(debt) (pre-IFRS 16) \n \n \n \n \n \n 6.9 \n \n \n \n \n \n (8.8) \n \n \n \n \n \n \n Cash generated before change in working capital and share options \n \n \n \n \n \n 17.6 \n \n \n \n \n \n 16.5 \n \n \n \n \n \n \n Principal repayment of lease liabilities \n \n \n \n \n \n (1.6) \n \n \n \n \n \n (1.7) \n \n \n \n \n \n \n Change in trade and other receivables \n \n \n \n \n \n 1.5 \n \n \n \n \n \n (12.2) \n \n \n \n \n \n \n Repayment of advance receipts from the MoJ \n \n \n \n \n \n (6.2) \n \n \n \n \n \n 4.2 \n \n \n \n \n \n \n Deferred VAT (net of corporation tax offset) \n \n \n \n \n \n (5.8) \n \n \n \n \n \n (36.6) \n \n \n \n \n \n \n Change in trade, other payables and provisions \n \n \n \n \n \n (0.9) \n \n \n \n \n \n (0.7) \n \n \n \n \n \n \n Taxation and interest received \n \n \n \n \n \n (2.3) \n \n \n \n \n \n 3.9 \n \n \n \n \n \n \n Capital investment (net of disposals) \n \n \n \n \n \n (3.6) \n \n \n \n \n \n (4.5) \n \n \n \n \n \n \n Net proceeds from equity issue \n \n \n \n \n \n - \n \n \n \n \n \n 46.4 \n \n \n \n \n \n \n Payments from restricted funds for NMW \n \n \n \n \n \n - \n \n \n \n \n \n 0.9 \n \n \n \n \n \n \n Settlement of NMW liabilities from restricted funds \n \n \n \n \n \n - \n \n \n \n \n \n (0.9) \n \n \n \n \n \n \n Other \n \n \n \n \n \n (0.6) \n \n \n \n \n \n 0.4 \n \n \n \n \n \n \n Closing net cash (pre-IFRS 16) \n \n \n \n \n \n 5.0 \n \n \n \n \n \n 6.9 \n \n \n \n \n \n \n IFRS 16 lease liabilities \n \n \n \n \n \n (4.9) \n \n \n \n \n \n (4.6) \n \n \n \n \n \n \n Closing net cash (post-IFRS 16) \n \n \n \n \n \n 0.1 \n \n \n \n \n \n 2.3 \n \n \n \n \n \n \n \n Note: Underlying operating profit is before goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying costs. EBITDA represents Earnings Before Interest, Taxation, Depreciation and Amortisation. \n \n \n \n   \n \n \n The Group's headroom relative to available committed banking facilities as at 31 December 2022 was £75.9m (2021: £78.4m) as set out below: \n \n \n \n \n \n \n \n \n \n \n \n \n \n 2022 £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Cash at bank \n \n \n \n \n 31.0 \n \n \n \n \n 29.8 \n \n \n \n \n \n \n Undrawn receivables finance facility agreement \n \n \n \n \n 44.9 \n \n \n \n \n 48.6 \n \n \n \n \n \n \n Banking facility headroom \n \n \n \n \n 75.9 \n \n \n \n \n 78.4 \n \n \n \n \n \n \n \n Working capital financing \n \n \n \n The Group manages its working capital requirements using a Receivables Financing Agreement (\"RFA\"), and a number of separate, non-recourse, customer financing arrangements whereby specific customers' invoices are settled in advance of their normal settlement date via a funding intermediary. \n \n \n The principal terms of the RFA are described in note 14. The RFA leverages the Group's trade receivables with sufficient headroom and flexibility to manage the variability and size of weekly cash outflows. The balance outstanding at 31 December 2022 was £26.0m (2021: £22.9m). \n \n \n The balance funded under the customer financing arrangements at 31 December 2022 was £51.7m (2021: £42.3m). \n \n \n Dividends \n \n \n The Board is not proposing a final dividend payment for 2022. \n \n \n Going Concern \n \n \n For the period to 31 December 2024, the Group's cash flow forecasts indicate ongoing headroom in the Receivables Finance Agreement and also full compliance with the financial covenants contained therein. The Group has sufficient day to day liquidity to ensure that short-term liabilities can be satisfied as and when they fall due. \n \n \n The financial statements have been prepared on a going concern basis. The Directors have reviewed this basis and have made full disclosure in note 3, concluding that there is a reasonable expectation that the Group and Company have adequate resources to continue in operational existence for the foreseeable future. \n \n \n   \n \n \n \n Daniel Quint \n \n \n \n \n Chief Financial Officer \n \n \n \n 20 March 2023 \n \n \n \n   \n \n \n \n \n   \n \n \n \n \n Alternative performance measures \n \n \n \n \n \n 1 \n \n Underlying results exclude goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying charges \n \n \n \n \n \n 2 \n \n Presented on a pre-IFRS16, which excludes lease liabilities, and also excludes refinancing costs \n \n \n \n   \n \n \n   \n \n \n Consolidated statement of comprehensive income \n \n \n For the year ended 31 December 2022 \n \n \n \n \n \n \n \n \n \n \n \n \n \n Note \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Continuing operations \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Revenue \n \n \n \n \n 4 \n \n \n \n \n 940.5 \n \n \n \n \n 942.7 \n \n \n \n \n \n \n Cost of sales \n \n \n \n \n 5 \n \n \n \n \n (857.3) \n \n \n \n \n (859.9) \n \n \n \n \n \n \n Gross profit \n \n \n \n \n \n \n \n \n \n \n \n 83.2 \n \n \n \n \n 82.8 \n \n \n \n \n \n \n Administrative expenses \n \n \n \n \n 5 \n \n \n \n \n (78.6) \n \n \n \n \n (80.5) \n \n \n \n \n \n \n Operating profit \n \n \n \n \n \n \n \n \n \n \n \n 4.6 \n \n \n \n \n 2.3 \n \n \n \n \n \n \n Underlying operating profit before non-underlying administrative expenses \n \n \n \n \n \n \n \n \n \n \n \n 12.0 \n \n \n \n \n 10.3 \n \n \n \n \n \n \n Administrative expenses (non-underlying) \n \n \n \n \n 5 \n \n \n \n \n (7.4) \n \n \n \n \n (8.0) \n \n \n \n \n \n \n Operating profit \n \n \n \n \n \n \n \n \n \n \n \n 4.6 \n \n \n \n \n 2.3 \n \n \n \n \n \n \n Finance income \n \n \n \n \n 6 \n \n \n \n \n \n 0.7 \n \n \n \n \n \n - \n \n \n \n \n \n \n Finance charges \n \n \n \n \n 6 \n \n \n \n \n (3.4) \n \n \n \n \n (2.4) \n \n \n \n \n \n \n Net finance charges \n \n \n \n \n \n \n \n \n \n \n \n (2.7) \n \n \n \n \n (2.4) \n \n \n \n \n \n \n Profit/(loss) for the year before taxation \n \n \n \n \n \n \n \n \n \n \n \n 1.9 \n \n \n \n \n (0.1) \n \n \n \n \n \n \n Tax credit \n \n \n \n \n 7 \n \n \n \n \n 1.9 \n \n \n \n \n 1.7 \n \n \n \n \n \n \n Profit from continuing activities \n \n \n \n \n \n \n \n \n \n \n \n 3.8 \n \n \n \n \n 1.6 \n \n \n \n \n \n \n Loss from discontinued operations \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n (0.4) \n \n \n \n \n \n \n Profit for the year \n \n \n \n \n \n \n \n \n \n \n \n 3.8 \n \n \n \n \n 1.2 \n \n \n \n \n \n \n Items that will not be reclassified to profit and loss - actuarial gains, net of tax \n \n \n \n \n \n \n \n \n \n \n \n 0.4 \n \n \n \n \n 0.7 \n \n \n \n \n \n \n Items that will be reclassified to profit and loss: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n - effective portion of gain on hedging instrument measured at fair value \n \n \n \n \n \n \n \n \n \n \n \n 1.5 \n \n \n \n \n 0.2 \n \n \n \n \n \n \n - cumulative translation loss \n \n \n \n \n \n \n \n \n \n \n \n 0.1 \n \n \n \n \n (0.3) \n \n \n \n \n \n \n Total comprehensive income \n \n \n \n \n \n \n \n \n \n \n \n 5.8 \n \n \n \n \n 1.8 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Earnings per ordinary share \n \n \n \n \n 8 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Continuing operations: Basic and diluted \n \n \n \n \n \n \n \n \n \n \n \n 2.3p \n \n \n \n \n 1.3p \n \n \n \n \n \n \n Discontinued operations: Basic and diluted \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n (0.3)p \n \n \n \n \n \n \n Total earnings per share: Basic and diluted \n \n \n \n \n \n \n \n \n \n \n \n 2.3p \n \n \n \n \n 1.0p \n \n \n \n \n \n \n   \n \n \n The accompanying notes form an integral part of these financial statements. \n \n \n   \n \n \n \n \n \n \n Consolidated statement of changes in equity \n \n \n For the year ended 31 December 2022 \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share \n \n \n capital \n \n \n £m \n \n \n \n \n Own \n \n \n shares \n \n \n £m \n \n \n \n \n Share \n \n \n premium \n \n \n £m \n \n \n \n \n Share- \n \n \n based \n \n \n payment \n \n \n  reserve \n \n \n £m \n \n \n \n \n Cash flow hedge reserve \n \n \n £m \n \n \n \n \n Profit \n \n \n and loss \n \n \n account \n \n \n £m \n \n \n \n \n Total \n \n \n equity \n \n \n £m \n \n \n \n \n \n \n At 31 December 2020 (reported) \n \n \n \n \n 6.9 \n \n \n \n \n (4.8) \n \n \n \n \n 75.1 \n \n \n \n \n 0.6 \n \n \n \n \n - \n \n \n \n \n (57.9) \n \n \n \n \n 19.9 \n \n \n \n \n \n \n Prior year adjustment (note 3) \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n (2.3) \n \n \n \n \n (2.3) \n \n \n \n \n \n \n At 31 December 2020 (restated) \n \n \n \n \n 6.9 \n \n \n \n \n (4.8) \n \n \n \n \n 75.1 \n \n \n \n \n 0.6 \n \n \n \n \n - \n \n \n \n \n (60.2) \n \n \n \n \n 17.6 \n \n \n \n \n \n \n Cancellation of JSOP shares \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n (0.4) \n \n \n \n \n - \n \n \n \n \n 0.4 \n \n \n \n \n - \n \n \n \n \n \n \n Save As You Earn (\"SAYE\") share scheme - equity-settled \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.1 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.1 \n \n \n \n \n \n \n Proceeds from share issue \n \n \n \n \n 9.7 \n \n \n \n \n - \n \n \n \n \n 36.7 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 46.4 \n \n \n \n \n \n \n Transactions with owners \n \n \n \n \n 9.7 \n \n \n \n \n - \n \n \n \n \n 36.7 \n \n \n \n \n (0.3) \n \n \n \n \n - \n \n \n \n \n 0.4 \n \n \n \n \n 46.5 \n \n \n \n \n \n \n Profit for the year \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 1.2 \n \n \n \n \n 1.2 \n \n \n \n \n \n \n Cash flow hedge reserve \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.2 \n \n \n \n \n - \n \n \n \n \n 0.2 \n \n \n \n \n \n \n Actuarial gain on pension scheme, net of taxation \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.7 \n \n \n \n \n 0.7 \n \n \n \n \n \n \n Cumulative translation adjustments \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n (0.3) \n \n \n \n \n (0.3) \n \n \n \n \n \n \n Total comprehensive income for the year, net of tax \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.2 \n \n \n \n \n 1.6 \n \n \n \n \n 1.8 \n \n \n \n \n \n \n At 31 December 2021 \n \n \n \n \n 16.6 \n \n \n \n \n (4.8) \n \n \n \n \n 111.8 \n \n \n \n \n 0.3 \n \n \n \n \n 0.2 \n \n \n \n \n (58.2) \n \n \n \n \n 65.9 \n \n \n \n \n \n \n Save As You Earn (\"SAYE\") share scheme - equity-settled \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.3 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.3 \n \n \n \n \n \n \n Issue of shares to management \n \n \n \n \n - \n \n \n \n \n 0.7 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n (0.6) \n \n \n \n \n 0.1 \n \n \n \n \n \n \n Own shares purchased \n \n \n \n \n - \n \n \n \n \n (0.4) \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n (0.4) \n \n \n \n \n \n \n Transactions with owners \n \n \n \n \n \n - \n \n \n \n \n \n \n 0.3 \n \n \n \n \n \n \n - \n \n \n \n \n \n 0.3 \n \n \n \n \n \n - \n \n \n \n \n \n \n (0.6) \n \n \n \n \n \n \n - \n \n \n \n \n \n \n \n Profit for the year \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 3.8 \n \n \n \n \n 3.8 \n \n \n \n \n \n \n Cash flow hedge reserve \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 1.5 \n \n \n \n \n - \n \n \n \n \n 1.5 \n \n \n \n \n \n \n Actuarial gain on pension scheme, net of taxation \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.4 \n \n \n \n \n 0.4 \n \n \n \n \n \n \n Cumulative translation adjustments \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.1 \n \n \n \n \n 0.1 \n \n \n \n \n \n \n Total comprehensive income for the year, net of tax \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 1.5 \n \n \n \n \n 4.3 \n \n \n \n \n 5.8 \n \n \n \n \n \n \n At 31 December 2022 \n \n \n \n \n 16.6 \n \n \n \n \n (4.5) \n \n \n \n \n 111.8 \n \n \n \n \n 0.6 \n \n \n \n \n 1.7 \n \n \n \n \n (54.5) \n \n \n \n \n 71.7 \n \n \n \n \n \n \n   \n \n \n The accompanying notes form an integral part of these financial statements. \n \n \n   \n \n \n   \n \n \n \n \n \n Consolidated and Company statements of financial position \n \n \n As at 31 December 2022 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Consolidated \n \n \n \n \n \n \n Company \n \n \n \n \n \n \n \n Note \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n Restated \n \n \n £m \n \n \n \n \n 1 January 2021 \n \n \n Restated \n \n \n £m \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Non-current \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Goodwill \n \n \n \n \n 9 \n \n \n \n \n 59.6 \n \n \n \n \n 59.6 \n \n \n \n \n 59.6 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Other intangible assets \n \n \n \n \n \n \n \n \n \n \n \n 9.4 \n \n \n \n \n 16.5 \n \n \n \n \n 24.3 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Investments \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 59.6 \n \n \n \n \n 67.8 \n \n \n \n \n \n \n Property, plant and equipment \n \n \n \n \n 10 \n \n \n \n \n 7.6 \n \n \n \n \n 8.0 \n \n \n \n \n 9.6 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Deferred tax asset \n \n \n \n \n \n \n \n \n \n \n \n 5.0 \n \n \n \n \n 4.9 \n \n \n \n \n 4.7 \n \n \n \n \n 0.4 \n \n \n \n \n 0.8 \n \n \n \n \n \n \n Retirement benefit net asset \n \n \n \n \n \n \n \n \n \n \n \n 0.2 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 81.8 \n \n \n \n \n 89.0 \n \n \n \n \n 98.2 \n \n \n \n \n 60.0 \n \n \n \n \n 68.6 \n \n \n \n \n \n \n Current \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Trade and other receivables \n \n \n \n \n \n \n \n \n \n \n \n 119.8 \n \n \n \n \n 113.6 \n \n \n \n \n 102.2 \n \n \n \n \n 3.2 \n \n \n \n \n 3.0 \n \n \n \n \n \n \n Current tax asset \n \n \n \n \n \n \n \n \n \n \n \n 0.3 \n \n \n \n \n 0.6 \n \n \n \n \n 1.7 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Derivative financial instruments \n \n \n \n \n 12 \n \n \n \n \n 3.0 \n \n \n \n \n 0.5 \n \n \n \n \n - \n \n \n \n \n 3.0 \n \n \n \n \n 0.5 \n \n \n \n \n \n \n Cash and cash equivalents \n \n \n \n \n 13 \n \n \n \n \n 31.0 \n \n \n \n \n 29.8 \n \n \n \n \n 24.5 \n \n \n \n \n 0.1 \n \n \n \n \n - \n \n \n \n \n \n \n Restricted cash \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.9 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 154.1 \n \n \n \n \n 144.5 \n \n \n \n \n 129.3 \n \n \n \n \n 6.3 \n \n \n \n \n 3.5 \n \n \n \n \n \n \n Debtors: amounts falling due after more than one year \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 32.2 \n \n \n \n \n 30.8 \n \n \n \n \n \n \n Total assets \n \n \n \n \n \n \n \n \n \n \n \n 235.9 \n \n \n \n \n 233.5 \n \n \n \n \n 227.5 \n \n \n \n \n 98.5 \n \n \n \n \n 102.9 \n \n \n \n \n \n \n Liabilities \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Current \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Trade and other payables \n \n \n \n \n \n \n \n \n \n \n \n 130.3 \n \n \n \n \n 134.3 \n \n \n \n \n 155.6 \n \n \n \n \n 1.0 \n \n \n \n \n 3.4 \n \n \n \n \n \n \n Borrowings \n \n \n \n \n 14 \n \n \n \n \n 26.0 \n \n \n \n \n 22.9 \n \n \n \n \n 13.0 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Provisions \n \n \n \n \n \n \n \n \n \n \n \n 0.9 \n \n \n \n \n 1.4 \n \n \n \n \n 3.8 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Lease liabilities \n \n \n \n \n 11 \n \n \n \n \n 1.5 \n \n \n \n \n 1.3 \n \n \n \n \n 1.6 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 158.7 \n \n \n \n \n 159.9 \n \n \n \n \n 174.0 \n \n \n \n \n 1.0 \n \n \n \n \n 3.4 \n \n \n \n \n \n \n Non-current \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Borrowings \n \n \n \n \n 14 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 20.0 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Other liabilities \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n 0.3 \n \n \n \n \n 7.3 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Provisions \n \n \n \n \n \n \n \n \n \n \n \n 0.6 \n \n \n \n \n 1.4 \n \n \n \n \n 1.2 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Lease liabilities \n \n \n \n \n 11 \n \n \n \n \n 3.4 \n \n \n \n \n 3.3 \n \n \n \n \n 3.9 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Deferred tax liabilities \n \n \n \n \n \n \n \n \n \n \n \n 1.5 \n \n \n \n \n 2.7 \n \n \n \n \n 3.5 \n \n \n \n \n 0.6 \n \n \n \n \n - \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 5.5 \n \n \n \n \n 7.7 \n \n \n \n \n 35.9 \n \n \n \n \n 0.6 \n \n \n \n \n - \n \n \n \n \n \n \n Total liabilities \n \n \n \n \n \n \n \n \n \n \n \n 164.2 \n \n \n \n \n 167.6 \n \n \n \n \n 209.9 \n \n \n \n \n 1.6 \n \n \n \n \n 3.4 \n \n \n \n \n \n \n Equity \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Share capital \n \n \n \n \n 15 \n \n \n \n \n 16.6 \n \n \n \n \n 16.6 \n \n \n \n \n 6.9 \n \n \n \n \n 16.6 \n \n \n \n \n 16.6 \n \n \n \n \n \n \n Own shares \n \n \n \n \n \n \n \n \n \n \n \n (4.5) \n \n \n \n \n (4.8) \n \n \n \n \n (4.8) \n \n \n \n \n (4.5) \n \n \n \n \n (4.8) \n \n \n \n \n \n \n Share premium \n \n \n \n \n \n \n \n \n \n \n \n 111.8 \n \n \n \n \n 111.8 \n \n \n \n \n 75.1 \n \n \n \n \n 111.8 \n \n \n \n \n 111.8 \n \n \n \n \n \n \n Share-based payment reserve \n \n \n \n \n \n \n \n \n \n \n \n 0.6 \n \n \n \n \n 0.3 \n \n \n \n \n 0.6 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Cash flow hedge reserve \n \n \n \n \n \n \n \n \n \n \n \n 1.7 \n \n \n \n \n 0.2 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.2 \n \n \n \n \n \n \n Profit and loss account \n \n \n \n \n \n \n \n \n \n \n \n (54.5) \n \n \n \n \n (58.2) \n \n \n \n \n (60.2) \n \n \n \n \n (27.0) \n \n \n \n \n (24.3) \n \n \n \n \n \n \n Total equity \n \n \n \n \n \n \n \n \n \n \n \n 71.7 \n \n \n \n \n 65.9 \n \n \n \n \n 17.6 \n \n \n \n \n 96.9 \n \n \n \n \n 99.5 \n \n \n \n \n \n \n Total equity and liabilities \n \n \n \n \n \n \n \n \n \n \n \n 235.9 \n \n \n \n \n 233.5 \n \n \n \n \n 227.5 \n \n \n \n \n 98.5 \n \n \n \n \n 102.9 \n \n \n \n \n \n \n   \n \n \n The accompanying notes form an integral part of these financial statements. \n \n \n   \n \n \n   \n                     \n \n \n \n \n \n \n Consolidated statement of cash flows \n \n \n For the year ended 31 December 2022 \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Note \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Cash flows from operating activities \n \n \n \n \n 16 \n \n \n \n \n 5.5 \n \n \n \n \n (28.7) \n \n \n \n \n \n \n Taxation received \n \n \n \n \n \n \n \n \n \n \n \n 0.4 \n \n \n \n \n 5.8 \n \n \n \n \n \n \n Net cash inflow/(outflow) from operating activities \n \n \n \n \n \n \n \n \n \n \n \n 5.9 \n \n \n \n \n (22.9) \n \n \n \n \n \n \n Cash flows from investing activities - trading \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Purchases of property, plant and equipment \n \n \n \n \n 10 \n \n \n \n \n (1.0) \n \n \n \n \n (2.4) \n \n \n \n \n \n \n Sale of property, plant and equipment \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n \n Purchase of intangible assets - software \n \n \n \n \n \n \n \n \n \n \n \n (2.3) \n \n \n \n \n (2.1) \n \n \n \n \n \n \n Total cash flows arising from investing activities \n \n \n \n \n \n \n \n \n \n \n \n (3.3) \n \n \n \n \n (4.5) \n \n \n \n \n \n \n Total cash flows arising from operating and investing activities \n \n \n \n \n \n \n \n \n \n \n \n 2.6 \n \n \n \n \n (27.4) \n \n \n \n \n \n \n Cash flows from financing activities \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Net movements on Receivables Finance Agreement \n \n \n \n \n 14 \n \n \n \n \n 3.1 \n \n \n \n \n 9.9 \n \n \n \n \n \n \n Loan repayments \n \n \n \n \n 14 \n \n \n \n \n - \n \n \n \n \n (20.0) \n \n \n \n \n \n \n Principal repayment of lease liabilities \n \n \n \n \n 11 \n \n \n \n \n (1.6) \n \n \n \n \n (1.7) \n \n \n \n \n \n \n Net interest paid \n \n \n \n \n \n \n \n \n \n \n \n (2.5) \n \n \n \n \n (1.9) \n \n \n \n \n \n \n Payment from restricted fund \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n 0.9 \n \n \n \n \n \n \n Settlement of NMW liabilities from restricted fund \n \n \n \n \n \n \n \n \n \n \n \n - \n \n \n \n \n (0.9) \n \n \n \n \n \n \n Own shares purchased \n \n \n \n \n \n \n \n \n \n \n \n (0.4) \n \n \n \n \n - \n \n \n \n \n \n \n Gross proceeds from the issue of share capital \n \n \n \n \n 15 \n \n \n \n \n - \n \n \n \n \n 48.4 \n \n \n \n \n \n \n Costs relating to the issue of share capital \n \n \n \n \n 15 \n \n \n \n \n - \n \n \n \n \n (2.0) \n \n \n \n \n \n \n Net cash flows from financing activities \n \n \n \n \n \n \n \n \n \n \n \n (1.4) \n \n \n \n \n 32.7 \n \n \n \n \n \n \n Net change in cash and cash equivalents \n \n \n \n \n \n \n \n \n \n \n \n 1.2 \n \n \n \n \n 5.3 \n \n \n \n \n \n \n Cash and cash equivalents at beginning of year \n \n \n \n \n \n \n \n \n \n \n \n 29.8 \n \n \n \n \n 24.5 \n \n \n \n \n \n \n Cash and cash equivalents at end of year \n \n \n \n \n 14 \n \n \n \n \n 31.0 \n \n \n \n \n 29.8 \n \n \n \n \n \n \n   \n \n \n   \n \n \n The accompanying notes form an integral part of these financial statements. \n \n \n   \n \n \n   \n \n \n \n \n \n \n Notes to the financial information \n \n \n \n \n For the year ended 31 December 2022 \n \n \n \n   \n \n \n 1 Nature of operations \n \n \n   \n \n \n The principal activities of Staffline Group plc and its subsidiaries (\"the Group\") include the provision of recruitment and outsourced human resource services to industry and the provision of skills and employment training and support. \n \n \n   \n \n \n 2 General information and statement of compliance \n \n \n   \n \n \n Staffline Group plc, a Public Limited Company limited by shares listed on AIM (\"the Company\"), is incorporated and domiciled in England, United Kingdom. The Company acts as the holding company of the Group. The Company's registration number is 05268636. \n \n \n   \n \n \n The financial information set out in this document does not constitute the Group's statutory accounts for the years ended 31 December 2022 or 2021 but is derived from those accounts. Statutory accounts for 2021 have been delivered to the registrar of companies. The auditors have reported on those accounts; their reports were (i) unqualified, and (ii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. Statutory accounts for 2022 will be delivered to the registrar of companies in due course. The auditors have reported on those accounts; their reports were (i) unqualified, and (ii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. \n \n \n The financial statements for the year ended 31 December 2022 (including the comparatives for the year ended 31 December 2021) were approved and authorised for issue by the Board of Directors on 20 March 2023. This results announcement for the year ended 31 December 2022 was also approved by the Board on 20 March 2023. \n \n \n 3 Accounting policies \n \n \n   \n \n \n Basis of preparation \n \n \n The Consolidated financial statements are prepared for the year ended 31 December 2022. The Consolidated financial statements of the Group have been prepared on a going concern basis using the significant accounting policies and measurement bases summarised below, and in accordance UK adopted International Accounting Standards. The financial statements are prepared under the historical cost convention except for equity-settled share options, derivative financial instruments and the retirement benefit net asset, which are measured at fair value. \n \n \n   \n \n \n There are no new accounting pronouncements which have become effective in the year. \n \n \n \n \n \n Going concern \n \n \n The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Chief Executive Officer's Review. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the Financial Review. \n \n \n   \n \n \n As described in the Chief Executive Officer's Review, despite the challenging trading conditions experienced across all divisions in the Group during 2022, the Group reported an underlying operating profit for the year on continuing activities. In the recruitment divisions, the recovery from Covid-19 pandemic in early 2022 was mixed following the gradual return to work for most sectors, which was accompanied by unexpected high levels of labour shortages, especially in logistics-based sectors. The Group's PeoplePlus division continued to be impacted by the disruption to its skills training as a result of the tight labour market with workers being able to go straight into jobs without pre-job training. \n \n \n   \n \n \n The Directors maintained tight cost control throughout with overheads at reduced levels, additionally benefiting from previous restructuring programmes. These initiatives resulted in improved performance in the second half of the year generating increased underlying profit and positive cash generation. \n \n \n   \n \n \n The Directors have prepared updated forecasts and cash flow projections to 31 December 2024, which is considered to be a reasonable period over which a reasonable view can be formed. These forecasts have been used to assess going concern and have been stress-tested by applying basic sensitivity analysis, involving a reduction to revenues across all three divisions, over the forecast period. \n \n \n   \n \n \n In forming their opinion, the Directors have performed a robust assessment of the principal risks and uncertainties facing the Group. Consequently, the Directors believe that the Group is well placed to manage its business risks successfully. \n \n \n   \n \n \n At 31 December 2022, the Group had net cash of £5.0m (2021: net cash of £6.9m), on a pre-IFRS 16 basis, and has committed debt facilities until 1 December 2025. For the period to 31 December 2024, the Group's cash flow forecasts indicate ongoing headroom in the Receivables Finance Agreement and also full compliance with the financial covenants contained therein. The Group has sufficient day to day liquidity to ensure that short-term liabilities can be satisfied as and when they fall due. Further details of the financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the Financial Review. \n \n \n   \n \n \n As a result, the Directors have formed a judgement, at the time of approving the financial statements, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence and meet its liabilities as they fall due over the assessment period. The Directors have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's ability to continue as a going concern for a period of at least 18 months from when the financial statements are authorised for issue. For this reason, the Directors continue to adopt the going concern basis in preparing the financial statements. \n \n \n \n \n \n Prior year restatement \n \n \n Prior year restatements \n \n \n   \n \n \n During the year it was determined that PeoplePlus had overstated revenues totalling £2.6m in relation to the period prior to 31 December 2021, as PeoplePlus had not met some of its revenue related performance obligations. \n \n \n   \n \n \n As with any prior year adjustment, management have applied their judgement based on relevant information now available which management should have had access to at the time. The £2.6m error is based on management's best estimate of the amount of the revenue reversal but this remains subject to final agreement between the respective parties. \n \n \n   \n \n \n Due to the legacy nature of these revenues, management have accounted for the adjustment of these errors through reserves. \n \n \n The required adjustment is set out in the table below; trade receivables, as included in current assets, is overstated by £2.6m and deferred tax assets, as included in non-current assets, is understated by £0.3m. \n \n \n \n \n \n Restatement of Consolidated statement of financial position \n \n \n As at 1 January 2021 and at 31 December 2021 \n \n \n \n \n \n \n \n \n \n \n \n \n \n 2020 \n \n \n Reported \n \n \n £m \n \n \n \n \n Revenue overstated \n \n \n £m \n \n \n \n \n 2020 \n \n \n Restated \n \n \n £m \n \n \n \n \n 2021 \n \n \n Reported \n \n \n £m \n \n \n \n \n Revenue overstated \n \n \n £m \n \n \n \n \n 2021 \n \n \n Restated \n \n \n £m \n \n \n \n \n \n \n Assets \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Non-current \n \n \n \n \n 97.9 \n \n \n \n \n 0.3 \n \n \n \n \n 98.2 \n \n \n \n \n 88.7 \n \n \n \n \n 0.3 \n \n \n \n \n 89.0 \n \n \n \n \n \n \n Current \n \n \n \n \n 131.9 \n \n \n \n \n (2.6) \n \n \n \n \n 129.3 \n \n \n \n \n 147.1 \n \n \n \n \n (2.6) \n \n \n \n \n 144.5 \n \n \n \n \n \n \n Total assets \n \n \n \n \n 229.8 \n \n \n \n \n (2.3) \n \n \n \n \n 227.5 \n \n \n \n \n 235.8 \n \n \n \n \n (2.3) \n \n \n \n \n 233.5 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Liabilities \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n   Current \n \n \n \n \n 174.0 \n \n \n \n \n - \n \n \n \n \n 174.0 \n \n \n \n \n 159.9 \n \n \n \n \n - \n \n \n \n \n 159.9 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Non-current \n \n \n \n \n \n 35.9 \n \n \n \n \n - \n \n \n \n \n 35.9 \n \n \n \n \n 7.7 \n \n \n \n \n - \n \n \n \n \n 7.7 \n \n \n \n \n \n \n Total liabilities \n \n \n \n \n 209.9 \n \n \n \n \n - \n \n \n \n \n 209.9 \n \n \n \n \n 167.6 \n \n \n \n \n - \n \n \n \n \n 167.6 \n \n \n \n \n \n \n Equity \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Total equity \n \n \n \n \n 19.9 \n \n \n \n \n (2.3) \n \n \n \n \n 17.6 \n \n \n \n \n 68.2 \n \n \n \n \n (2.3) \n \n \n \n \n 65.9 \n \n \n \n \n \n \n Total equity and liabilities \n \n \n \n \n 229.8 \n \n \n \n \n (2.3) \n \n \n \n \n 227.5 \n \n \n \n \n 235.8 \n \n \n \n \n (2.3) \n \n \n \n \n 233.5 \n \n \n \n \n \n \n   \n \n \n   \n \n \n Consolidation of subsidiaries \n \n \n The Group financial statements consolidate those of the parent Company and all of its subsidiaries as at 31 December 2022 in accordance with IFRS 10. Subsidiaries are all entities to which the Group is exposed to or has rights to variable returns and the ability to affect those returns through control over the subsidiary. The results of subsidiaries whose accounts are prepared in a currency other than sterling; are translated at the average rates of exchange during the period and their year-end balances at the year-end rate of exchange. Translation adjustments are taken to the profit and loss reserves. \n \n \n   \n \n \n Material intra-group balances and transactions, and any unrealised gains or losses arising from intra-group transactions, are eliminated in preparing these financial statements. \n \n \n   \n \n \n Underlying profit - non-GAAP measures of performance \n \n \n In the reporting of its financial performance, the Group uses certain measures that are not defined under IFRS, the Generally Accepted Accounting Principles (\"GAAP\") under which the Group reports. The Directors believe that these non-GAAP measures assist with the understanding of the performance of the business. These non-GAAP measures are not a substitute, or superior to, any IFRS measures of performance but they have been included as the Directors consider them to be an important means of comparing performance year-on-year and they include key measures used within the business for assessing performance. \n \n \n   \n \n \n Gross sales value \n \n \n Gross sales value represents the fair value of the consideration received or receivable for the supply of services, including agency sales, (excluding fees), which are subject to an IFRS 15 agency adjustment, net of value added tax, rebates and discounts and after eliminating sales within the Group. \n \n \n Non-underlying items of income and expenditure \n \n \n These non-underlying charges are regarded as recurring or non-recurring items of income or expenditure of a particular size and/or nature relating to the operations of the business that in the Directors' opinion require separate identification. These items are included in \"total\" reported results but are excluded from \"underlying\" results. These items can vary significantly from year to year and therefore create volatility in reported earnings which does not reflect the Group's underlying performance. \n \n \n   \n \n \n Underlying EBITDA \n \n \n Underlying operating profit before the deduction of underlying depreciation and amortisation charges. This is considered a useful measure because it approximates the underlying cash flow by eliminating depreciation and amortisation charges. \n \n \n   \n \n \n Net debt \n \n \n Net debt is the amount of bank debt less available cash balances excluding escrow funds. This is a key measure as it is one on which the terms of the banking facilities are based and shows the level of external debt utilised by the Group to fund operations. Net debt is also presented on a pre-IFRS 16 basis which excludes lease liabilities. \n \n \n   \n \n \n The Directors acknowledge that the adjustments made to arrive at underlying profit may not be comparable to those made by other companies and it should be noted that whilst the amortisation of acquisition-related intangible assets has been added back, the revenue from those acquisitions has not been eliminated. \n \n \n   \n \n \n These alternative performance measures are utilised by the Board to monitor performance and financial position. They show a comparable level of performance excluding one-off items, with which underlying performance and ability to service debt can be judged. \n \n \n   \n \n \n Business combinations \n \n \n The Group applies the acquisition method in accounting for business combinations. The consideration transferred by the Group to obtain control of a subsidiary is calculated as the sum of the acquisition-date fair value of assets transferred, liabilities incurred and the equity interests of the Group, which includes the fair value of any asset or liability arising from a contingent consideration arrangement. Acquisition costs are expensed as incurred. \n \n \n   \n \n \n Goodwill is stated after separate recognition of identifiable intangible assets. It is calculated as the sum of a) fair value of consideration transferred, b) the recognised amount of any non-controlling interest in the acquiree and c) acquisition-date fair value of any existing equity interest in the acquiree, over the acquisition-date fair values of identifiable net assets. If the fair values of identifiable net assets exceed the sum calculated above, the excess amount (i.e. gain on a bargain purchase) is recognised in the statement of comprehensive income immediately. \n \n \n   \n \n \n Segment reporting \n \n \n The Group has three material operating segments: the provision of recruitment and outsourced human resource services to industry, in Great Britain (Recruitment GB) an also in Ireland (Recruitment Ireland), plus the provision of skills training and probationary services, together \"PeoplePlus\". Each of these operating segments is managed separately as each requires different technologies, marketing approaches and other resources. For management purposes, the Group uses the same measurement policies as those used in its financial statements. \n \n \n \n 4 Segment reporting \n \n \n   \n \n \n Management currently identifies three operating segments: Recruitment GB, the provision of workforce recruitment and management to industry, Recruitment Ireland, the provision of generalist recruitment services and PeoplePlus, the provision of skills and employment training and support. The Group's reporting segments are determined based on the Group's internal reporting to the Chief Operating Decision Maker (CODM). The CODM has been determined to be the Group Chief Executive, with support from the Board. \n \n \n   \n \n \n Whilst there are individual legal entities within the three operating segments, they are operated and reviewed as single units by the Board of Directors. Each legal entity within an operating segment has the same management team, head office and have similar economic characteristics. The Group's strategy, historically and going forward, has been to integrate new acquisitions into the main trading entities within each operating segment. \n \n \n Segment information for the reporting year is as follows: \n \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2022 \n \n \n £m \n \n \n \n \n Recruitment Ireland \n \n \n 2022 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2022 \n \n \n £m \n \n \n \n \n Group \n \n \n Costs \n \n \n 2022 \n \n \n £m \n \n \n \n \n Total \n \n \n Group \n \n \n 2022 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2021 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n Ireland \n \n \n 2021 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2021 \n \n \n £m \n \n \n \n \n Group \n \n \n Costs \n \n \n 2021 \n \n \n £m \n \n \n \n \n Total \n \n \n Group \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Sales revenue from external customers \n \n \n \n \n \n 752.0 \n \n \n \n \n \n 110.6 \n \n \n \n \n 77.9 \n \n \n \n \n - \n \n \n \n \n 940.5 \n \n \n \n \n 747.9 \n \n \n \n \n 111.7 \n \n \n \n \n 83.1 \n \n \n \n \n   \n \n \n - \n \n \n \n \n 942.7 \n \n \n \n \n \n \n Cost of sales \n \n \n \n \n (700.0) \n \n \n \n \n (97.7) \n \n \n \n \n (59.6) \n \n \n \n \n - \n \n \n \n \n (857.3) \n \n \n \n \n (697.2) \n \n \n \n \n (100.4) \n \n \n \n \n (62.3) \n \n \n \n \n - \n \n \n \n \n (859.9) \n \n \n \n \n \n \n Segment gross profit \n \n \n \n \n 52.0 \n \n \n \n \n 12.9 \n \n \n \n \n 18.3 \n \n \n \n \n - \n \n \n \n \n 83.2 \n \n \n \n \n 50.7 \n \n \n \n \n 11.3 \n \n \n \n \n 20.8 \n \n \n \n \n - \n \n \n \n \n 82.8 \n \n \n \n \n \n \n Administrative expenses \n \n \n \n \n (40.5) \n \n \n \n \n (9.3) \n \n \n \n \n (12.5) \n \n \n \n \n (3.3) \n \n \n \n \n (65.6) \n \n \n \n \n (40.4) \n \n \n \n \n (8.4) \n \n \n \n \n (14.0) \n \n \n \n \n (3.4) \n \n \n \n \n (66.2) \n \n \n \n \n \n \n Depreciation, software & lease amortisation \n \n \n \n \n (3.2) \n \n \n \n \n (0.4) \n \n \n \n \n (2.0) \n \n \n \n \n - \n \n \n \n \n (5.6) \n \n \n \n \n (3.2) \n \n \n \n \n (0.4) \n \n \n \n \n (2.7) \n \n \n \n \n - \n \n \n \n \n (6.3) \n \n \n \n \n \n \n Segment underlying operating profit* \n \n \n \n \n 8.3 \n \n \n \n \n 3.2 \n \n \n \n \n 3.8 \n \n \n \n \n (3.3) \n \n \n \n \n 12.0 \n \n \n \n \n 7.1 \n \n \n \n \n 2.5 \n \n \n \n \n 4.1 \n \n \n \n \n (3.4) \n \n \n \n \n 10.3 \n \n \n \n \n \n \n Amortisation of intangibles arising on business combinations \n \n \n \n \n (5.9) \n \n \n \n \n (1.3) \n \n \n \n \n (0.2) \n \n \n \n \n - \n \n \n \n \n (7.4) \n \n \n \n \n (6.4) \n \n \n \n \n (1.4) \n \n \n \n \n (0.2) \n \n \n \n \n - \n \n \n \n \n (8.0) \n \n \n \n \n \n \n Segment profit from operations \n \n \n \n \n 2.4 \n \n \n \n \n 1.9 \n \n \n \n \n 3.6 \n \n \n \n \n (3.3) \n \n \n \n \n 4.6 \n \n \n \n \n 0.7 \n \n \n \n \n 1.1 \n \n \n \n \n 3.9 \n \n \n \n \n (3.4) \n \n \n \n \n 2.3 \n \n \n \n \n \n \n Finance (costs)/income \n \n \n \n \n (3.1) \n \n \n \n \n (0.1) \n \n \n \n \n - \n \n \n \n \n 0.5 \n \n \n \n \n (2.7) \n \n \n \n \n (2.0) \n \n \n \n \n (0.3) \n \n \n \n \n - \n \n \n \n \n (0.1) \n \n \n \n \n (2.4) \n \n \n \n \n \n \n Segment profit/(loss) before taxation \n \n \n \n \n (0.7) \n \n \n \n \n 1.8 \n \n \n \n \n 3.6 \n \n \n \n \n (2.8) \n \n \n \n \n 1.9 \n \n \n \n \n (1.3) \n \n \n \n \n 0.8 \n \n \n \n \n 3.9 \n \n \n \n \n (3.5) \n \n \n \n \n (0.1) \n \n \n \n \n \n \n Tax credit \n \n \n \n \n 1.8 \n \n \n \n \n - \n \n \n \n \n (0.2) \n \n \n \n \n 0.3 \n \n \n \n \n 1.9 \n \n \n \n \n 0.3 \n \n \n \n \n (0.1) \n \n \n \n \n - \n \n \n \n \n 1.5 \n \n \n \n \n 1.7 \n \n \n \n \n \n \n Segment profit/(loss) from continuing operations \n \n \n \n \n 1.1 \n \n \n \n \n \n 1.8 \n \n \n \n \n \n \n 3.4 \n \n \n \n \n \n (2.5) \n \n \n \n \n 3.8 \n \n \n \n \n (1.0) \n \n \n \n \n 0.7 \n \n \n \n \n 3.9 \n \n \n \n \n (2.0) \n \n \n \n \n 1.6 \n \n \n \n \n \n \n   \n \n \n *       Segment underlying operating profit before goodwill impairment, amortisation of intangible assets arising on business combinations, reorganisation costs and other non-underlying costs. \n \n   \n \n \n \n \n \n \n \n \n \n \n \n \n \n Recruitment \n \n \n \n \n GB \n \n \n \n \n 2022 \n \n \n \n \n £m \n \n \n \n \n \n \n Recruitment Ireland \n \n \n \n \n 2022 \n \n \n \n \n £m \n \n \n \n \n \n \n PeoplePlus \n \n \n \n \n 2022 \n \n \n \n \n £m \n \n \n \n \n \n \n Staffline Group \n \n \n \n \n 2022 \n \n \n \n \n £m \n \n \n \n \n \n \n Total \n \n \n \n \n Group \n \n \n \n \n 2022 \n \n \n \n \n £m \n \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2021 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n Ireland \n \n \n 2021 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2021 \n \n \n Restated \n \n \n £m \n \n \n \n \n Staffline Group \n \n \n 2021 \n \n \n £m \n \n \n \n \n Total Group \n \n \n Restated \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Total non-current assets \n \n \n \n \n \n 28.4 \n \n \n \n \n \n \n 12.2 \n \n \n \n \n \n \n 36.2 \n \n \n \n \n \n \n - \n \n \n \n \n \n \n 76.8 \n \n \n \n \n \n 36.0 \n \n \n \n \n 11.6 \n \n \n \n \n 36.5 \n \n \n \n \n - \n \n \n \n \n 84.1 \n \n \n \n \n \n \n Total current assets \n \n \n \n \n \n 117.6 \n \n \n \n \n \n \n 19.9 \n \n \n \n \n \n \n 13.3 \n \n \n \n \n \n \n 3.3 \n \n \n \n \n \n \n 154.1 \n \n \n \n \n \n 106.6 \n \n \n \n \n 20.1 \n \n \n \n \n 17.3 \n \n \n \n \n 0.5 \n \n \n \n \n 144.5 \n \n \n \n \n \n \n Total assets (consolidated) \n \n \n \n \n \n 146.0 \n \n \n \n \n \n \n 32.1 \n \n \n \n \n \n \n 49.5 \n \n \n \n \n \n \n 3.3 \n \n \n \n \n \n \n 230.9 \n \n \n \n \n \n 142.6 \n \n \n \n \n 31.7 \n \n \n \n \n 53.8 \n \n \n \n \n 0.5 \n \n \n \n \n 228.6 \n \n \n \n \n \n \n Total liabilities (consolidated) \n \n \n \n \n \n 135.1 \n \n \n \n \n \n \n 11.0 \n \n \n \n \n \n \n 17.5 \n \n \n \n \n \n \n 0.6 \n \n \n \n \n \n \n 164.2 \n \n \n \n \n \n 128.0 \n \n \n \n \n 13.2 \n \n \n \n \n 26.3 \n \n \n \n \n 0.1 \n \n \n \n \n 167.6 \n \n \n \n \n \n \n Cash capital expenditure inc software \n \n \n \n \n \n 2.0 \n \n \n \n \n \n \n 0.5 \n \n \n \n \n \n \n 0.8 \n \n \n \n \n \n \n - \n \n \n \n \n \n \n 3.3 \n \n \n \n \n \n 2.8 \n \n \n \n \n - \n \n \n \n \n 1.7 \n \n \n \n \n - \n \n \n \n \n 4.5 \n \n \n \n \n \n \n   \n \n \n \n The analysis above excludes deferred tax assets as required by IFRS 8 Operating segments. \n \n \n \n   \n \n \n Revenues can be analysed by country as follows (96.7% of revenues arising within the UK in 2022, 97.0% in 2021): \n \n \n \n \n \n \n \n \n \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2022 \n \n \n £m \n \n \n \n \n Recruitment Ireland \n \n \n 2022 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2022 \n \n \n £m \n \n \n \n \n Total \n \n \n Group \n \n \n 2022 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n GB \n \n \n 2021 \n \n \n £m \n \n \n \n \n Recruitment \n \n \n Ireland \n \n \n 2021 \n \n \n £m \n \n \n \n \n PeoplePlus \n \n \n 2021 \n \n \n £m \n \n \n \n \n Total Group \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n UK \n \n \n \n \n \n 751.8 \n \n \n \n \n \n 80.0 \n \n \n \n \n 77.9 \n \n \n \n \n \n 909.7 \n \n \n \n \n \n 747.8 \n \n \n \n \n 83.9 \n \n \n \n \n 83.1 \n \n \n \n \n 914.8 \n \n \n \n \n \n \n Republic of Ireland \n \n \n \n \n - \n \n \n \n \n \n 30.6 \n \n \n \n \n \n - \n \n \n \n \n \n 30.6 \n \n \n \n \n \n - \n \n \n \n \n 27.8 \n \n \n \n \n - \n \n \n \n \n 27.8 \n \n \n \n \n \n \n Portugal \n \n \n \n \n 0.2 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n \n 0.2 \n \n \n \n \n \n 0.1 \n \n \n \n \n - \n \n \n \n \n - \n \n \n \n \n 0.1 \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n 752.0 \n \n \n \n \n \n 110.6 \n \n \n \n \n 77.9 \n \n \n \n \n \n 940.5 \n \n \n \n \n \n 747.9 \n \n \n \n \n 111.7 \n \n \n \n \n 83.1 \n \n \n \n \n 942.7 \n \n \n \n \n \n \n   \n \n \n No customer contributed more than 10% of the Group's revenue during either 2021 or 2020. \n \n \n   \n \n \n 5 Expenses by nature \n \n \n   \n \n \n Expenses by nature are as follows: \n \n \n   \n \n \n Underlying expenses \n \n \n \n \n \n \n \n \n \n \n \n \n \n 2022 \n \n \n £m \n \n \n \n \n 2021 \n \n \n £m \n \n \n \n \n \n \n Employee benefits expenses - cost of sales \n \n \n \n \n \n 836.2 \n \n \n \n \n \n 834.1 \n \n \n \n \n \n \n Other cost of sales \n \n \n \n \n 21.1 \n \n \n \n \n 25.7 \n \n \n \n \n \n \n Employee benefits expenses - administrative expenses \n \n \n \n \n 47.3 \n \n \n \n \n 46.1 \n \n \n \n \n \n \n Depreciation and software amortisation \n \n \n \n \n 5.6 \n \n \n \n \n 6.3 \n \n \n \n \n \n \n Operating lease expenses \n \n \n \n \n 1.2 \n \n \n \n \n 1.5 \n \n \n \n \n \n \n Other administrative expenses \n \n \n \n \n 17.1 \n \n \n \n \n 18.7 \n \n \n \n \n \n \n \n \n \n \n \n \n \n 928.5 \n \n \n \n \n 932.4 \n \n \n \n \n \n \n Disclosed as: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n Cost of sales \n \n \n \n \n 857.3 \n \n \n \n \n 859.9 \n \n \n \n \n \n \n Administrative expenses - excluding non-underlying expenses \n \n \n \n \n 71.2 \n \n \n \n \n 72.5 \n \n \n \n \n \n \n \n \n \n \n \n \n \n 928.5 \n \n \n \n \n 932.4 \n \n \n \n \n \n \n   \n \n \n Auditors' remuneration \n \n \n \n \n \n \n \n \n \n \n \n \n \n 2022 \n \n \n £'000 \n \n \n \n \n 2021 \n \n \n £'000 \n \n \n \n \n \n \n Fees payable to the Company's auditor for the audit of the Company's annual accounts \n \n \n \n \n 17 \n \n \n \n \n 15 \n \n \n \n \n \n \n Fees payable to the Company's auditor and its associates for other services: \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n ...

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