Northland Capital Partners View on the City - Management Resource Solutions

Management Resource Solutions (LON:MRS) SECTOR – SUPPORT SERVICES RATING – CORP* MARKET CAP – £9.1m CURRENT PRICE – 4.3p^# ANALYST – MIKE JEREMY	Year-end June	2017A	2018A	2019E	2020E
	Revenue (A$m)	52.4	69.1	No forecasts provided
	EBITDA (A$m)	(4.9)	12.3
	Adj. pre-tax Profit (A$m)	(10.6)	6.0
	Adj. EPS (A$c)	(13.0)	3.0
	DPS (A$c)	-	-
	Net Cash/(Debt) (A$m)	(15.7)	(20.4)
	P/E (x)	-	3.2
	Dividend yield (%)	-	-
	EV/EBITDA (x)	(7.1)	3.2
	SOURCE: Northland Capital Partners Limited estimates. #Priced at prior trading day close. *Northland Capital Partners Limited acts as Nomad and Broker to Management Resource Solutions plc and therefore this information should be viewed as a Marketing Communication. 1GBP=A$1.77.

Trading update – FY19 in-line with board expectations

NORTHLAND VIEW

In a Trading Update Management Resource Solutions reported “the first six months of FY19 was a period of continued progress for the Group.”
The company provided updated guidance for FY19, expecting trading in-line with Board expectations:

§ Net Revenue of A$73.0m - 75.0m (FY18: $69.1m);

§ EBITDA of A$12.0m - 14m (FY18: $12.3m);

§ Profit before Tax $8.0m - 9.0m (FY18: $6.0m);

§ EPS of A4.5 - 5.1c per share (2.6p - 3.0p per share at an A$/GBP exchange rate of 1.7).

Performance has been driven by strong demand for MRS' services in the resources and construction markets in Australia, continued investment in core profitable assets and rigorous cost management, plus a strong focus on new markets with higher margins. The process of restructuring, review of assets and depreciation, debt restructuring and improved internal synergies will continue through FY19.
The Group intends to announce Interim Results on 28 February.

MRS delivered a strong 2017/18 turnaround. We have noted high levels of Australian government spending on core civil infrastructure and growth in the construction sector, factors which are echoed in the company’s own confidence in its outlook, augmented by the restructuring measures and improvements in operational efficiency the company has put into action.

COMPANY DESCRIPTION

Management Resource Solutions plc through its subsidiaries Bachmann Plant Hire and MRS Services Group, offers plant hire, equipment repair, refurbishment and fabrication, mine rehabilitation, earthmoving, road construction and support services.