REG - Robert Walters PLC - Full Year Results <Origin Href="QuoteRef">KWE.L</Origin> <Origin Href="QuoteRef">RWA.L</Origin>

Robert WaltersAnnouncement

26/02/2015 07:13

RNS Number : 9096F
Robert Walters PLC
26 February 2015
26 February 2015
ROBERT WALTERS PLC
(the 'Company' or the 'Group')
Results for the year ended 31 December 2014
PROFITS UP 80%
Robert Walters plc (LSE: RWA), the international specialist professional recruitment consultancy, today announces its results for the year ended 31 December 2014.
Financial and Operational Highlights
Year ended
2014
2013
% change
% change (constant currency*) 
Revenue
679.6m
597.7m
14%
19%
Gross profit (net fee income)
215.3m
199.2m
8%
14%
Operating profit
18.2m
10.8m
68%
78%
Profit before taxation
18.2m
10.1m
80%
91%
Basic earnings per share
15.3p
8.4p
82%

*Constant currency is calculated by applying prior year exchange rates to local currency results for the current and prior years.
 Strong net fee income growth in constant currency across all of the Group's regions driving an 80% increase in profit before taxation, to 18.2m.
 Excellent performance in the UK with net fee income increasing by 24%. 
o Growth across both London and the regions.
o Increased activity in permanent financial services recruitment in London.
 Asia Pacific net fee income up 8% in constant currency.
o Emerging market strategy has proven successful with our newer operations in Malaysia, Thailand, and Vietnam, in particular, delivering excellent growth in net fee income.
o Strong growth also delivered across more established markets such as Japan, Singapore and Hong Kong.
o Australia returned to growth during the fourth quarter. Record performance in New Zealand.
 Europe net fee income up 10% in constant currency.
o Excellent contract growth in France and Benelux.
o Permanent recruitment grew strongly in Belgium and Ireland. Spain delivered record net fee income.
 Other International net fee income up 35% in constant currency. 
o Middle East business more than doubled net fee income year-on-year.
o US had a record year across both New York and San Francisco.
 Resource Solutions, the Group's recruitment process outsourcing business continued to deliver significant net fee income growth in the UK and Asia across both new and existing clients.
 Final dividend per share increased 13% to 4.35p (2013: 3.86p).
 Group headcount increased to 2,631 (2013: 2,307).
 1.3m shares were purchased at an average price of 3.11 for 4.0m, in line with the Group's share buyback programme.
 Strong balance sheet with net cash of 14.3m as at 31 December 2014 (2013: 18.6m).
Robert Walters, Chief Executive, said:
"We delivered an excellent performance in 2014, increasing profit before taxation by 80%. This is testament to the strength, depth and diversity that the Group now has in terms of both geography and discipline. 
"Early trading in 2015 has been in line with expectations. Whilst we are mindful of continued Eurozone uncertainty, we believe we are very well positioned to capitalise on both current and future growth opportunities."
The Company will be holding a presentation for analysts at 10am today at Newgate Communications, Sky Light City Tower, 50 Basinghall Street, London EC2V 5DE.
The Group will publish an Interim Management Statement for the first quarter ended 31 March 2015 on 8 April 2015. 
- Ends -
For further information please contact:
Robert Walters plc
Robert Walters, Chief Executive
Alan Bannatyne, Chief Financial Officer
+44 (0) 20 7379 3333
Newgate Communications
Fergus Wylie
Madeleine Palmstierna
+44 (0) 20 7680 6550
 
About Robert Walters
Robert Walters is a market-leading international specialist professional recruitment consultancy with over 2,600 staff spanning 24 countries. We specialise in the placement of the highest calibre professionals across the disciplines of accountancy and finance, banking, engineering, HR, IT, legal, sales, marketing, secretarial and support and supply chain and procurement. Our client base ranges from the world's leading blue-chip corporates and financial services organisations through to SMEs and start-ups. 
Businesses worldwide rely on us to find the very best specialist professionals to drive their business forward and those same professionals trust us to manage their long-term careers.
www.robertwalters.com
Robert Walters plc
Results for the year ended 31 December 2014
Chairman's Statement
I am very pleased to report that the Group delivered an exceptionally strong performance in 2014, increasing profit before taxation by 80% (91%*). Our strategy of long-term investment in the business across both our established businesses and high-growth potential, emerging recruitment markets has enabled us to leverage the Group's operational gearing to deliver an excellent result for the year. 
Revenue was up 14% (19%*) to 679.6m (2013: 597.7m) and gross profit (net fee income) increased by 8% (14%*) to 215.3m (2013: 199.2m). Operating profit was up 68% (78%*) to 18.2m (2013: 10.8m) and earnings per share increased by 82% to 15.3p per share (2013: 8.4p per share). The Group has a strong balance sheet with net cash of 14.3m as at 31 December 2014 (31 December 2013: 18.6m). Permanent recruitment represents 69% (2013: 69%) of recruitment net fee income.
In line with our strategy, we have grown staff numbers in emerging markets and in mature markets where activity levels are increasing and additionally we have won a number of new Resource Solutions clients in the UK and Asia. Headcount at the end of the year increased by 14% to 2,631 (2013: 2,307). 
The Board will be recommending a 13% increase in the final dividend to 4.35p per share which combined with the interim dividend of 1.65p per share will result in a total dividend of 6.0p per share (2013: 5.4p). In 2014, 1.3m shares were purchased at an average price of 3.11 for 4.0m through the Group's long-term share buy-back programme. The Board is authorised to re-purchase up to 10% of the Group's issued share capital and will be seeking approval for the renewal of this authority at the Annual General Meeting on 3 June 2015.
Finally, I would like to thank everyone in the Group for their hard work, drive, commitment and loyalty. 
Leslie Van de Walle
Chairman
25 February 2015
Chief Executive's Statement
Review of Operations
The excellent performance in 2014 served to further highlight the strength, depth and diversity that the Group now has in terms of both geography and discipline. We have been able to leverage this strength to deliver an 80% (91%*) increase in profit before taxation, a result that was particularly impressive given that market conditions in two of the Group's largest markets, Australia and France, remained challenging for much of last year. 
We have a strong blend of permanent and contract recruitment net fee income, a truly global footprint of growing recruitment businesses across both established and embryonic recruitment markets plus a market-leading recruitment process outsourcing business - all of which is underpinned by a powerful international brand and a strong and experienced senior management team. 
The recruitment industry continues to evolve through the advent of new resourcing strategies and technologies and we remain firmly at the forefront of these developments. The role of a high-quality specialist professional recruitment consultancy, such as Robert Walters, to filter and manage the increased volume of data and the number of communication channels available to candidates and clients has never been more important. In addition, our Resource Solutions business ensures we are extremely well placed to benefit from the trend towards an outsourced recruitment model. 
Asia Pacific (42% of net fee income)
Revenue was 251.4m (2013: 260.1m) and net fee income was 90.5m (2013: 92.1m) an increase of 8% in constant currency. This delivered an operating profit increase of 45% (59%*) to 10.5m (11.5m*) (2013: 7.2m).
In Asia we have benefited from strong growth within our larger, more mature and market-leading businesses in Japan, Singapore and Hong Kong and, very encouragingly, we are also now seeing positive returns from our more recent investments in a number of the region's emerging recruitment markets. Our operations in Malaysia, Thailand and Vietnam in particular have delivered excellent net fee income growth and, critically, have the capacity to grow into substantial businesses. 
Australia returned to growth in the fourth quarter and in New Zealand, our businesses in Auckland and Wellington both delivered record performances. 
Resource Solutions in Asia won a number of new clients and also successfully extended a number of existing client deals. 
UK (33% of net fee income)
Revenue was 311.9m (2013: 235.7m), net fee income increased by 24% to 71.1m (2013: 57.2m) and operating profit more than doubled to 5.2m (2013: 2.5m).
The UK had an excellent year as both client and candidate confidence continued to improve. Growth was broad-based and spread across both London and the regions, with disciplines such as commerce finance, legal and sales & marketing delivering particularly strong performances. Also of particular note, was the beginning of a recovery in the permanent financial services market in London, with recruitment levels across risk, compliance and projects particularly high.
To continue to build on this performance and further extend our regional presence, we have opened a new office in St. Albans. 
Resource Solutions continued to deliver impressive results increasing net fee income significantly year-on-year. 
Europe (20% of net fee income)
Revenue was 106.4m (2013: 93.9m) and net fee income increased 4% (10%*) to 43.8m (46.1m*) (2013: 42.0m) producing a 73% increase in operating profit to 2.2m (2.3m*) (2013: 1.3m).
Market conditions across the Eurozone were mixed. In France, our largest business in the region, the permanent recruitment market remained challenging, however our contract business continues to go from strength to strength and produced excellent growth. 
Recruitment activity levels across the Benelux region were more favourable, with our business in Belgium the standout performer across both the permanent and contract markets. We continue to focus on Germany as a key growth market for the Group and are also very encouraged by the strong performance in a number of our smaller markets in the region such as Spain and Ireland.
Other International (5% of net fee income)
Revenue was 9.9m (2013: 8.0m) and net fee income increased by 25% (35%*) to 9.9m (10.7m*) (2013: 7.9m) producing an operating profit of 0.3m (operating profit of 0.2m*) (2013: operating loss of 0.2m).
Other International comprises the US, South Africa, the Middle East and Brazil. Our business in the US had a record year with both San Francisco and New York delivering excellent growth. In New York, much like London, we have seen a recovery in the permanent financial services market with areas such as compliance particularly active, whilst the technology-driven San Francisco market remains extremely buoyant. 
Client and candidate confidence in Brazil remains low, our office in Dubai more than doubled net fee income year-on-year whilst in South Africa net fee income grew strongly and we are now one of the largest international players in the market. 
Current Trading and Outlook
Having entered seven new countries since 2010, the Robert Walters Group now has over 2,600 staff spanning 24 countries. We have focused on increasing the profitability and productivity of our fledging businesses and the Group as a whole, delivering an 80% uplift in profit before taxation and an increase in consultant productivity. 
Early trading in 2015 has been in line with expectations. Whilst we are mindful of continued Eurozone uncertainty, we believe we are very well positioned to capitalise on both current and future growth opportunities. 
Robert Walters
Chief Executive
25 February 2015
Consolidated Income Statement
FOR THE YEAR ENDED 31 DECEMBER 2014

2014
2013

'000
'000
Revenue 
679,604
597,719
Cost of sales
(464,286)
(398,525)
Gross profit
215,318
199,194
Administrative expenses
(197,098)
(188,360)
Operating profit
18,220
10,834
Finance income
137
121
Finance costs
(464)
(797)
Gain (loss) on foreign exchange
266
(87)
Profit before taxation
18,159
10,071
Taxation
(6,904)
(3,915)
Profit for the year
11,255
6,156



Attributable to:


Owners of the Company
11,255
6,156
Earnings per share (pence): 


Basic
15.3
8.4
Diluted
13.9
7.7
The amounts above relate to continuing operations.
Consolidated Statement of Comprehensive Income
FOR THE YEAR ENDED 31 DECEMBER 2014

2014
2013

'000
'000
Profit for the year
11,255
6,156
Items that may be reclassified subsequently to profit and loss:


Exchange differences on translation of overseas operations
(1,553)
(5,164)
Total comprehensive income and expense for the year
9,702
992



Attributable to:


Owners of the Company
9,702
992
Consolidated Balance Sheet
AS AT 31 DECEMBER 2014

2014
2013

'000
'000
Non-current assets


Intangible assets
9,577
9,517
Property, plant and equipment
8,156
9,300
Deferred tax assets
8,216
8,998

25,949
27,815
Current assets


Trade and other receivables
168,240
153,700
Corporation tax receivables
117
1,949
Cash and cash equivalents
38,205
30,071

206,562
185,720
Total assets
232,511
213,535



Current liabilities


Trade and other payables
(125,527)
(124,149)
Corporation tax liabilities
(3,672)
(2,314)
Bank overdrafts and loans
(23,904)
(11,496)
Provisions
(377)
(606)

(153,480)
(138,565)
Net current assets
53,082
47,155



Non-current liabilities


Deferred tax liabilities
(10)
(39)
Provisions
(1,647)
(1,049)

(1,657)
(1,088)
Total liabilities
(155,137)
(139,653)
Net assets
77,374
73,882



Equity


Share capital
17,192
17,177
Share premium
21,753
21,753
Other reserves
(73,410)
(73,410)
Own shares held
(8,765)
(5,876)
Treasury shares held
(19,860)
(19,860)
Foreign exchange reserves
2,432
3,985
Retained earnings
138,032
130,113
Equity attributable to owners of the Company
77,374
73,882
Consolidated Cash Flow Statement
FOR THE YEAR ENDED 31 DECEMBER 2014

2014
2013

'000
'000
Cash generated from operating activities
11,270
19,240
Income taxes paid
(3,232)
(2,798)
Net cash from operating activities
8,038
16,442



Investing activities


Interest received
137
121
Purchases of computer software
(1,016)
(1,096)
Purchases of property, plant and equipment 
(2,294)
(1,351)
Purchase of non-controlling interest
(482)
(715)
Net cash used in investing activities
(3,655)
(3,041)



Financing activities


Equity dividends paid
(4,087)
(3,826)
Proceeds from issue of equity
15
567
Interest paid
(464)
(797)
Proceeds from bank loans and overdrafts
12,381
-
Repayment of bank loans
-
(3,061)
Purchase of own shares
(4,032)
-
Proceeds from exercise of share options
465
-
Net cash generated (used) in financing activities
4,278
(7,117)
Net increase in cash and cash equivalents
8,661
6,284



Cash and cash equivalents at beginning of year
30,071
26,022
Effect of foreign exchange rate changes
(527)
(2,235)
Cash and cash equivalents at end of year
38,205
30,071
Consolidated Statement of Changes in Equity
FOR THE YEAR ENDED 31 DECEMBER 2014

Share capital
Share premium
Other reserves
Own shares held
Treasury shares held
Foreign exchange reserves
Retained earnings
Total equity
Group
'000
'000
'000
'000
'000
'000
'000
'000
Balance at 1 January 2013
17,114
21,249
(73,410)
(9,121)
(19,860)
9,149
126,397
71,518
Profit for the year
-
-
-
-
-
-
6,156
6,156
Foreign currency translation differences
-
-
-
-
-
(5,164)
-
(5,164)
Total comprehensive income and expense for the year
-
-
-
-
-
(5,164)
6,156
992
Dividends paid
-
-
-
-
-
-
(3,826)
(3,826)
Credit to equity for equity-settled share-based payments
-
-
-
-
-
-
3,855
3,855
Deferred tax on share-based payment transactions
-
-
-
-
-
-
776
776
Transfer to own shares held on
exercise of equity incentives 
-
-
-
3,245
-
-
(3,245)
-
New shares issued
63
504
-
-
-
-
-
567
Balance at 31 December 2013
17,177
21,753
(73,410)
(5,876)
(19,860)
3,985
130,113
73,882
Profit for the year
-
-
-
-
-
-
11,255
11,255
Foreign currency translation differences
-
-
-
-
-
(1,553)
-
(1,553)
Total comprehensive income and expense for the year
-
-
-
-
-
(1,553)
11,255
9,702
Dividends paid
-
-
-
-
-
-
(4,087)
(4,087)
Credit to equity for equity-settled share-based payments
-
-
-
-
-
-
1,708
1,708
Deferred tax on share-based payment transactions
-
-
-
-
-
-
(280)
(280)
Transfer to own shares held on exercise of equity incentives
-
-
-
677
-
-
(677)
-
New shares issued and own shares purchased
15
-
-
(3,566)
-
-
-
(3,551)
Balance at 31 December 2014
17,192
21,753
(73,410)
(8,765)
(19,860)
2,432
138,032
77,374
Statement of Accounting Policies
FOR THE YEAR ENDED 31 DECEMBER 2014
Accounting Policies
Basis of preparation 
Robert Walters plc is a Company incorporated in the United Kingdom under the Companies Act.
The financial report for the year ended 31 December 2014 has been prepared in accordance with the historical cost convention and with International Financial Reporting Standards (IFRSs), including International Accounting Standards and Interpretations as adopted for use by the European Union, though this announcement does not itself contain sufficient information to comply with IFRSs.
The Group had net cash of 14.3m at 31 December 2014. Despite the volatile and uncertain global economic conditions, the Group remains confident of its long-term growth prospects. The Group has a strong balance sheet and considerable financial resources, together with a diverse range of clients and suppliers across different geographic locations and sectors. As a consequence, the Directors believe that the Group is well placed to manage its business risks successfully. After making enquiries, the Directors have formed ajudgement, at the time of approving the accounts, that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, the Directors continue to adopt the going concern basis in preparing the accounts.
The financial information in this announcement, which was approved by the Board of Directors on 25 February 2015, does not constitute the Company's statutory accounts for the year ended 31 December 2014 but is derived from these accounts. Statutory accounts for 2013have been delivered to the Registrar of Companies and those for 2014will be delivered following the Company's Annual General Meeting. The auditors have reported on these accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis without qualifying their report and did not contain statements under Section 498(2) or (3) of the Companies Act 2006.
The Annual General Meeting of Robert Walters plc will be held on 3 June 2015 at 11 Slingsby Place, St Martin's Courtyard, London WC2E 9AB.
1.
Segmental information


2014
2013


'000
'000
i) 
Revenue:



Asia Pacific
251,363
260,145

UK
311,941
235,734

Europe
106,351
93,855

Other International
9,949
7,985


679,604
597,719




ii) 
Gross profit:



Asia Pacific
90,536
92,069

UK
71,100
57,161

Europe
43,798
42,036

Other International
9,884
7,928


215,318
199,194
1.
Segmental information (continued)


2014
2013


'000
'000
iii) 
Profit before taxation:



Asia Pacific
10,502
7,242

UK
5,248
2,540

Europe
2,173
1,258

Other International
297
(206)

Operating profit
18,220
10,834

Net finance costs
(61)
(763)

Profit before taxation
18,159
10,071




iv) 
Net assets:



Asia Pacific
28,318
26,929

UK
22,247
11,309

Europe
6,993
8,099

Other International
864
376

Unallocated corporate assets and liabilities*
18,952
27,169


77,374
73,882
* For the purposes of segmental information, unallocated corporate assets and liabilities include cash, bank loans, corporation and deferred tax balances.
The analysis of revenue by destination is not materially different to the analysis by origin and the analysis of finance income and costs are not significant.
The Group is divided into geographical areas for management purposes, and it is on this basis that the segmental information has been prepared.


v)
Other information - 2014
P,P&E and software additions
Depreciation and amortisation
Non-current assets
 Assets
Liabilities


'000
'000
'000
'000
'000

Asia Pacific
1,298
1,580
11,379
53,265
(24,947)

UK
1,718
1,628
5,090
102,471
(80,224)

Europe
225
678
1,109
24,496
(17,503)

Other International
69
65
155
5,741
(4,877)

Unallocated corporate assets and liabilities*
-
-
8,216
46,538
(27,586)


3,310
3,951
25,949
232,511
(155,137)







1.
Segmental information (continued)







v)
Other information - 2013
P,P&E and software additions
Depreciation and amortisation
Non-current assets
Assets
Liabilities


'000
'000
'000
'000
'000

Asia Pacific
623
1,821
11,766
49,077
(22,148)

UK
1,470
1,733
5,171
96,075
(84,766)

Europe
268
408
1,680
23,883
(15,784)

Other International
86
62
200
3,482
(3,106)

Unallocated corporate assets and liabilities*
-
-
8,998
41,018
(13,849)


2,447
4,024
27,815
213,535
(139,653)
*For the purposes of segmental information, unallocated corporate assets and liabilities include cash, bank loans, corporation and deferred tax balances.




2014
2013


'000
'000
vi)
Revenue by business grouping:



Robert Walters
463,685
454,375

Resource Solutions (recruitment process outsourcing)
215,919
143,344


679,604
597,719
2.
Finance costs


2014
2013


'000
'000

Interest on bank overdrafts
443
771

Interest on bank loans
21
26

Total borrowing costs
464
797
3.
Taxation


2014
2013


'000
'000

Current tax charge



Corporation tax - UK
622
-

Corporation tax - Overseas
5,327
4,387





Adjustments in respect of prior years



Corporation tax - UK
102
-

Corporation tax - Overseas
494
99


6,545
4,486

Deferred tax



Deferred tax - UK
984
701

Deferred tax - Overseas
(573)
(1,315)





Adjustments in respect of prior years



Deferred tax - UK
(277)
44

Deferred tax - Overseas
225
(1)


359
(571)

Total tax charge for year
6,904
3,915





Profit before taxation
18,159
10,071





Tax at standard UK corporation tax rate of 21.5% (2013: 23.25%)
3,904
2,341

Effects of:



Unrelieved (relieved) losses
853
(54)

Other expenses not deductible for tax purposes
118
114

Overseas earnings taxed at different rates
1,340
1,067

Adjustments to tax charges in previous years
544
141

Impact of tax rate change
145
306

Total tax charge for year
6,904
3,915
4.
Dividends


2014
2013


'000
'000

Amounts recognised as distributions to equity holders in the year:



Interim dividend paid of 1.65p per share (2013: 1.54p)
1,267
1,116

Final dividend for 2013 of 3.86p per share (2012: 3.68p)
2,820
2,710


4,087
3,826

Proposed final dividend for 2014 of 4.35p per share 
(2013: 3.86p)
3,179
2,843



The proposed final dividend of 3,179,000 is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements.
The final dividend, if approved, will be paid on 12 June 2015 to those shareholders on the register as at 22 May 2015.

5.
Earnings per share

The calculation of earnings per share is based on the profit for the year attributable to equity holders of the parent and the weighted average number of shares of the Company.





2014
2013


'000
'000

Profit for the year attributable to equity holders of the parent
11,255
6,156






2014
2013


Number 
of shares
Number 
of shares

Weighted average number of shares:



Shares in issue throughout the year
85,886,614
85,570,741

Shares issued in the year
59,929
107,243

Treasury and own shares held
(12,161,441)
(12,682,876)

For basic earnings per share
73,785,102
72,995,108

Outstanding share options
7,017,561
7,206,147

For diluted earnings per share
80,802,663
80,201,255
6.
Intangible assets


Goodwill
Computer software
Total


'000
'000
'000

Cost:




At 1 January 2013
7,919
7,420
15,339

Additions
-
1,096
1,096

Disposals
-
(428)
(428)

Foreign currency translation differences
49
(231)
(182)

At 31 December 2013
7,968
7,857
15,825

Additions
-
1,016
1,016

Disposals
-
(664)
(664)

Foreign currency translation differences
16
(18)
(2)

At 31 December 2014
7,984
8,191
16,175

Accumulated amortisation and impairment: 




At 1 January 2013
-
5,862
5,862

Charge for the year
-
815
815

Disposals
-
(210)
(210)

Foreign currency translation differences
-
(159)
(159)

At 31 December 2013
-
6,308
6,308

Charge for the year
-
749
749

Disposals
-
(440)
(440)

Foreign currency translation differences
-
(19)
(19)

At 31 December 2014
-
6,598
6,598

Carrying value:




At 1 January 2013
7,919
1,558
9,477

At 31 December 2013
7,968
1,549
9,517

At 31 December 2014
7,984
1,593
9,577
The carrying value of goodwill primarily relates to the acquisition of Talent Spotter in China (1,101,000) and the historic acquisition of the Dunhill Group in Australia (6,847,000). The historical acquisition cost of Talent Spotter was 768,000, with the movement to the current carrying value a result of foreign currency translation differences. Goodwill is tested annually for impairment, or more frequently if there are indications that goodwill might be impaired. The recoverable amount of the goodwill is based on value in use in perpetuity. The key assumptions in the value in use are those regarding expected changes to cash flow during the period, growth rates and the discount rates.
Estimated cash flow forecasts are derived from the most recent financial budgets and an assumed average growth rate of 6% for years two to five, which does not exceed the long-term average potential growth rate of the respective operations. The forecast for revenue and costs approved by the Board reflect the latest industry forecasts and management expectations based on past experience. 
The value of the cash flows is then discounted at a post-tax rate of 6.6% (pre-tax rate of 10.7%), based on the Group's estimated weighted average cost of capital and risk adjusted depending on the location of goodwill. The forecast cash flow analysis has also been adjusted for a terminal growth rate, between 2-4% depending on location, for year six onwards.
Management has undertaken sensitivity analysis taking into consideration the impact in key assumptions. This included reducing the cash flow growth from Year two onwards by 0%, 10% and 20% in absolute terms. The sensitivity analysis shows no impairment would arise under each scenario.
7.
Property, plant and equipment


Leasehold improvements
'000
Fixtures, fittings and office equipment
'000
Computer equipment
'000
Motor vehicles
'000
Total
'000

Cost:






At 1 January 2013
6,535
10,731
5,923
85
23,274

Additions
171 
444
720
16
1,351

Disposals
(33)
(412)
(499)
(50)
(994)

Foreign currency translation differences
(286)
(781)
(359)
(5)
(1,431)

At 31 December 2013
6,387
9,982
5,785
46
22,200

Additions
727
671
888
8
2,294

Disposals
(319)
(275)
(867)
(34)
(1,495)

Foreign currency translation differences
11
(258)
(58)
(2)
(307)

At 31 December 2014
6,806
10,120
5,748
18
22,692








Accumulated depreciation and impairment:






At 1 January 2013
2,544
4,733
4,045
56
11,378

Charge for the year
826
1,160
1,194
29
3,209

Disposals
18
(329)
(473)
(50)
(834)

Foreign currency translation differences
(198)
(377)
(273)
(5)
(853)

At 31 December 2013
3,190
5,187
4,493
30
12,900

Charge for the year
834
1,392
965
11
3,202

Disposals
(311)
(186)
(843)
(29)
(1,369)

Foreign currency translation differences
(6)
(143)
(46)
(2)
(197)

At 31 December 2014
3,707
6,250
4,569
10
14,536








Carrying value:






At 1 January 2013
3,991
5,998
1,878
29
11,896

At 31 December 2013
3,197
4,795
1,292
16
9,300

At 31 December 2014
3,099
3,870
1,179
8
8,156
8.
Trade and other receivables


2014
2013


'000
'000

Receivables due within one year:



Trade receivables
122,735
117,127

Other receivables
4,295
3,337

Prepayments and accrued income
41,210
33,236


168,240
153,700
Included within prepayments and accrued income is a provision against the cancellation of placements where a candidate may reverse their acceptance prior to the start date. 
The value of this provision as of 31 December 2014 is 1,411,000 (31 December 2013: 1,115,000). The movement in the provision during the year is a charge to administrative expenses in the income statement of 296,000 (2013: 60,000).
As at 31 December 2014, in the UK, invoices aggregating 4.2m were sold under a non-recourse factoring arrangement, incurring charges of 0.1m.
9.
Trade payables and other payables: amounts falling due within one year


2014
2013


'000
'000

Trade payables
5,514
3,794

Other taxation and social security
19,543
20,393

Other payables
19,199
20,404

Accruals and deferred income
81,271
79,558


125,527
124,149
There is no material difference between the fair value and the carrying value of the Group's trade and other payables.
10.
Bank overdrafts and loans


2014
2013


'000
'000

Bank overdrafts and loans: current
23,904
11,496


23,904
11,496





The borrowings are repayable as follows:



Within one year
23,904
11,496


23,904
11,496
In January 2014, the Group renewed and extended its three-year committed financing facility to 35.0m which expires in November 2016. At 31 December 2014, 23.4m (2013: 11.0m) was drawn down under this facility.
The Group has a short-term facility of Renminbi 10m (1.0m) of which Renminbi 5m (0.5m) remains outstanding as at 31 December 2014. The loan is secured against cash deposits in Hong Kong.
The Directors estimate that the fair value of all borrowings is not materially different from the amounts stated in the Consolidated Balance Sheet of 23,904,000 (2013: 11,496,000). 
11.
Notes to the cash flow statement


2014
2013


'000
'000

Operating profit
18,220
10,834

Adjustments for:



Depreciation and amortisation charges
3,951
4,024

Loss on disposal of property, plant and equipment and computer software
350
378

Charge in respect of share-based payment transactions
1,708
3,855

Operating cash flows before movements in working capital
24,229
19,091

Increase in receivables
(16,097)
(33,151)

Increase in payables
3,138
33,300

Cash generated from operating activities
11,270
19,240
12.
Reconciliation of net cash flow to movement in net funds




2014
2013


'000
'000

Increase in cash and cash equivalents in the year
8,662
6,284

Cash (outflow) inflow from movement in bank loans
(12,381)
3,061

Foreign currency translation differences
(555)
(2,242)

Movement in net cash in the year
(4,274)
7,103

Net cash at beginning of year
18,575
11,472

Net cash at end of year
14,301
18,575
Net cash is defined as cash and cash equivalents less bank loans.

This information is provided by RNS
The company news service from the London Stock Exchange
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