Staffline Group PLC (LON:STAF) has said its full-year trading is expected to be in line with market expectations although net debt has risen due to transformation and acquisition costs.
In a trading update for the financial year ended 31 December 2018, the AIM-listed recruitment and training group said its revenues are anticipated to be around 18% higher than the £957.8mln reported for 2017.
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The company said its Recruitment division has continued to grow, with the acquisitions completed during the year performing ahead of management expectations.
It added that its PeoplePlus division, which has now successfully transitioned into the UK's leading Skills and Training provider, made good progress in the year.
The firm said the apprenticeship levy continues to present an excellent opportunity for growth in this area, and, along with Prison Education contract wins – announced yesterday - is offsetting the reduced activity from the run-off of the Work Programme.
One-off transformation costs
As part of the completion of the transformation of the Group's PeoplePlus division away from reliance on the Work Programme, Staffline pointed out that significant exceptional one-off costs have been incurred in 2018.
The group said no further exceptional costs relating to the end of the Work Programme are expected in 2019.
It added that the total exceptional costs will be £20mln in 2018, principally due to the PeoplePlus transformation, and whilst the group remains highly cash generative, these costs, together with second-half acquisition considerations, have resulted in an increase in its net debt to around £63mln as at 31 December 2018.
Staffline said it will announce its preliminary results for the year ended 31 December 2018 on Wednesday 30 January 2019.