Interim Results
ATA GROUP PLC
26 August 1999
ATA Group plc
Interim results for the six months ended 2 July 1999
ATA Group plc ('ATA') is a human resource support services
group, which provides employment solutions and training
services to client companies in England, Scotland and
Wales. ATA floated on the Alternative Investment Market
in June 1998.
HIGHLIGHTS
* Turnover £3.1m (1998: £3.4m)
* Pre-tax profit £0.19m (1998: £0.55m)
* Earnings per share 2.03p (1998: 6.25p)
* Maintained interim dividend of 2.0p
Commenting on the results Bill Douie, Chairman, said:
'The difficult conditions experienced in manufacturing in
the first half have inevitably impacted on the interim
results. Nonetheless, the Directors are encouraged by a
continuing recovery in operating ratios and look forward
to a more positive second half.'
ENQUIRIES:
ATA Group plc Tel: (0117) 924 1600
Bill Douie, Chairman
Clive Chapman, Chief Executive
College Hill Tel: (0171) 457 2020
Richard Pearson
Giles Cooper
ATA GROUP PLC
CHAIRMAN'S STATEMENT
FOR THE SIX MONTHS ENDED 2 JULY 1999
I am pleased to present the interim report of the company
for the period to 2 July 1999.
PROGRESS
As expected, conditions have been difficult, particularly
in manufacturing, and inevitably there has been a knock on
effect on the results of our most significant recruitment
business, Engineering Technology. There can be no doubt
that the continuing strength of sterling has provided a
testing environment for companies who are major exporters
or who suffer from import competition. Encouragingly,
there is some evidence that industry is learning to live
with a strong currency and confidence is returning, helped
by a more robust world economy.
More importantly, consultant numbers have been maintained
and significant advances in the development of management
skills at all levels in our company have resulted in
enhanced performance in our Sales and Advertising
selection recruitment businesses towards the end of the
period. Additionally, as recently reported, we have
opened a further location south of London, in Croydon, and
early signs are encouraging.
Development of our training business continues steadily
although securing Corporate courses has progressed at a
slower rate than planned. There are encouraging signs of
acceleration of bookings for the second half and beyond
and expansion of accommodation capacity at The Fairbourne
Hotel is at the planning permission stage.
Since the period end terms have been agreed for the
acquisition of a majority interest in the business of
Sloan Shrago, an occupational psychology consultancy.
Services are provided to Corporate clients to assist in
the establishment of human resource tactics to ensure
achievement of strategic objectives. In addition to the
existing provision of teambuilding, leadership and
personal development training, ATA Group intends to
establish a range of services in organisational
development to provide for the client needs identified by
Sloan Shrago.
Shareholders will also have noted our recent announcement
of the appointment of Peter McWeeney as finance director.
TRADING RESULTS
As previously announced difficult conditions have
adversely affected the trading performance in the first
half and pre tax profits in the period have fallen to
£191,459 (1998 £546,853). Earnings after corporation tax
of £60,021 are £131,438 and earnings per share, calculated
on the average number of shares in issue in the period,
are 2.03 (1998 6.25p)
DIVIDENDS
I am pleased with the success with which the Group has
handled a difficult period and the Directors remain
confident that a manufacturing recovery will continue
during the second half. Accordingly a maintained interim
dividend of 2.0p per share net will be paid on 17
September 1999 to shareholders on the register of members
on 10 September 1999.
OUTLOOK FOR THE REMAINDER OF 1999
ATA's predominant market place in recruitment remains
manufacturing industry and, whilst confidence has
recovered to an extent, the positive environment during
recovery from recession following the departure from ERM
is unlikely to re-emerge in the near future. Nonetheless,
the Directors are encouraged by a continuing recovery in
operating ratios and look forward to a more positive
second half. Although the two training companies are at
an early stage in their development and are unlikely to
form a significant part of 1999 results, both expected
performance in the second half and the accelerating pace
of long term developments encourage the Board to view
their future with confidence.
W.J.C.Douie, Chairman
26 August 1999.
ATA GROUP PLC
GROUP PROFIT AND LOSS ACCOUNT
Note 6 Months 6 Months 12 Months
to to to
2/7/99 3/7/98 31/12/98
(unaudited)(unaudited) (audited)
£'000 £'000 £'000
TURNOVER 2 3101.4 3404.2 6863.3
OPERATING PROFIT 172.1 538.0 1043.4
Net interest receivable 19.3 9.3 41.8
PROFIT ON ORDINARY
ACTIVITIES
BEFORE TAXATION 191.4 547.3 1085.2
Taxation 3 (60.0) (175.8) (333.0)
PROFIT ON ORDINARY
ACTIVITIES
AFTER TAXATION 131.4 371.5 752.2
Dividends 4 129.6 129.6 376.0
RETAINED PROFIT 1.8 241.9 376.2
EARNINGS PER SHARE (pence) 5 2.03 6.25 12.12
ATA GROUP PLC
GROUP BALANCE
at 2/7/99 at 3/7/98 at 31/12/98
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
FIXED ASSETS
Tangible assets 789.4 690.4 779.1
Intangible assets 89.2 73.6 95.9
878.6 764.0 875.0
CURRENT ASSETS
Stock 13.0 11.3 14.6
Debtors 805.5 873.3 687.8
Short term deposits 950.0 1150.0 750.0
Cash at bank 110.5 86.3 607.0
1879.0 2120.9 2059.4
CREDITORS: Due within one year (1622.7) (1831.8) (1750.4)
NET CURRENT ASSETS (LIABILTIES) 256.3 289.1 309.0
TOTAL ASSETS LESS
CURRENT LIABILITIES 1134.9 1053.1 1184.0
CREDITORS: Due after more than (183.8) (243.2) (234.7)
one year
NET ASSETS 951.1 809.9 949.3
CAPITAL AND RESERVES
Called up share capital 64.8 64.8 64.8
Capital redemption reserve 50.0 50.0 50.0
Share premium account 433.2 428.7 433.2
Profit and loss account 403.1 266.4 401.3
SHAREHOLDERS' FUNDS 951.1 809.9 949.3
ATA GROUP PLC
GROUP CASH FLOWSTATEMENTS
6 Months 6 Months 12 Months
to to to
2/7/99 3/7/98 31/12/98
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
CASH INFLOW FROM
OPERATING ACTIVITIES 68.3 604.7 1282.5
Returns on investments and
servicing of finance 28.7 9.3 30.2
Taxation - (147.1) (287.6)
Capital expenditure (119.5) (140.0) (328.0)
Acquisitions - (461.0) (473.7)
Equity dividends paid (246.3) (176.5) (306.1)
Net cash inflow (outflow)
before use of liquid resources (268.8) (310.6) (82.7)
and financing
(Increase) decrease in short (200.0) (425.0) (25.0)
term deposits
Net proceeds from issue of - 522.7 439.2
share capital
Increase (decrease) in medium (27.7) 293.2 269.5
term loan
INCREASE (DECREASE) IN CASH (496.5) 80.3 601.0
BALANCES
ATA GROUP PLC
NOTES TO THE INTERIM REPORT
FOR THE SIX MONTHS ENDED 2 JULY 1999
1 ACCOUNTING POLICIES
The accounting policies used in the preparation of the
interim accounts are consistent with those used in the
preparation of the audited annual accounts for the year
ended 31 December 1998. The group financial information
consolidates the accounts of ATA Group plc and all of
its material subsidiary undertakings using the
acquisition method.
The comparative figures for the year ended 31 December
1998 do not constitute statutory accounts within the
meaning of S.240 of the Companies Act 1995, but they
have been derived from the audited financial statements
for that year, which have been filed with the Registrar
of Companies, and on which our auditors gave an
unqualified report.
2 SEGMENTAL ANALYSIS
6 Months 6 Months 12 Months
to to to
2/7/1999 3/7/1998 31/12/1998
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
TURNOVER
Recruitment and 2,789.1 3,233.0 6,385.1
consultancy
Training 312.3 171.2 478.2
3,101.4 3,404.2 6,863.3
OPERATING PROFIT
Recruitment and 206.7 529.6 1,053.7
consultancy
Training (34.6) 8.4 (10.3)
172.1 538.0 1,043.4
3 TAXATION ON PROFIT ON ORDINARY ACTIVITIES
The taxation charge for the period to 2 July 1999 has
been provided at the estimated rate applicable to the
group for the year.
4 DIVIDENDS
An interim dividend of 2.0p per ordinary share will be
paid on 17 September 1999 to shareholders on the
register of members on 10 September 1999.
5 EARNINGS PER SHARE
The earnings per share have been calculated on the
profit on ordinary activities after taxation and on the
weighted average number of shares in issue during the
period. The fully diluted earnings per share (arising
from the share option schemes detailed in the
Prospectus) are not materially different from the basic
earnings per share and have not been disclosed.