24 January 2017
Empresaria Group plc ("Empresaria" or the "Group")
Trading Update and Notice of Results
Record profit, ahead of market expectations
Empresaria (AIM: EMR), the international specialist staffing group, today announces a trading update for the financial year ended 31 December 2016, ahead of announcing its final results on Wednesday 1 March 2017.
The Board is pleased to advise that full year profitability will be slightly ahead of market expectations. Adjusted profit before tax growth is expected to be approximately 23% year on year, representing a record profit level for the Group. Net fee income is approximately 20% ahead of the prior year and diluted adjusted earnings per share is expected to be up 12% on the prior year.
There were strong performances across the Group, with Headway in Germany, Skillhouse in Japan and Monroe in South East Asia all delivering solid growth year on year. In addition, the Group's businesses in Finland, Australia, China, India, Chile and the Technical & Industrial brands in the UK performed well. As announced at the half year, following a short period of uncertainty in the UK prior to the EU referendum, the UK region has seen stable activity levels return. Overall in the UK, this has led to profitability being down year on year, however the Group has reduced costs and is encouraged by the increased business activity as it moves into 2017. In the Middle East, the weak economic conditions persisted in the second half and expected improvements did not materialise. The business has been restructured accordingly and the Group expects an improved result in 2017 from this region.
The Group's USA investment, Pharmaceutical Strategies, is integrating well, having won a number of new clients and improved penetration across key clients. The decision during the year to invest in their management team and their largest client having reduced its overall spend on staffing requirements has resulted in a short-term impact on profitability. Despite this, the business continues to see good growth opportunities going forward.
As part of its 'Invest & Develop' strategy, the Group invested in two international brands in the period, strengthening the Group's presence in key global growth sectors. In July, the Group invested in Rishworth Aviation, the second largest recruitment company in the Aviation sector, operating across the UK, Continental Europe and Asia Pacific regions. The second investment, in October, was ConSol Partners, a specialist IT recruiter with a focus on the niche sectors of communications & mobile, cloud technologies and the digital supply chain, operating across the UK, Continental Europe and USA. Both businesses are performing well and demonstrating positive growth potential for the coming years.
Joost Kreulen, Chief Executive of Empresaria, said:
"Empresaria has demonstrated the benefit of its diversified business model, producing strong results with adjusted profit before tax up 23% on the prior year. We continue to deliver on our strategy: strengthening a multi-branded group, with a focus on developing leading brands that are diversified and balanced by geography and sector.
Alongside the strong growth in a number of regions, we are particularly pleased with the performance of the two international investments made during the year: Rishworth Aviation and ConSol Partners, with both performing well. These, alongside the successful integration of Pharmaceutical Strategies, are all important illustrations of the success of the Group's 'Invest & Develop' strategy and we look forward to the growth opportunity that these businesses have as part of the wider Group.
Overall, we are pleased with the record profit the Group has delivered, once again showing the strength of the diversified business model and the strategy the Group is delivering on. As such, we continue to see exciting growth opportunities for the Group in 2017."