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Impellam full-year revenue up 5.7% in 2018; investments, UK market conditions affect profit

March 14, 2019

Revenue was up 5.7% on a constant currency basis at Impellam Group plc for the full-year 2018. The UK-based company reported growth was driven by the group’s managed services segment. Gross profit was affected by challenging market conditions in the UK healthcare, education and retail markets.

The company also noted competitiveness of its international businesses improved.

Profit for the year fell to £13.3 million (US$16.7 million) from £31.1 million in the prior year. Impellam cited costs related to investments such as Ignite, its recruiters’ operating system; and ShiftWise, a technology solutions platform. The company also noted contraction of the healthcare, education and retail markets in the UK; the gross margin wind-down of two MSPs in North America in 2017 and the increased cost of compliance.

(£ millions) Full-year 2018 Full-year 2017 % change % change (constant currency) Full-year 2018 (US$ millions)
Revenue £2,276.7 £2,171.3 4.9% 5.7% $2,865.0
Gross profit £282.3 £285.5 -1.1% 0.1% $355.2
Gross margin 12.4% 13.1%      
Profit for the period £13.3 £31.1 -57.2%   $16.7

<Header> Revenue by segment for United Kingdom and North America

(£ millions) Full-year 2018 Full-year 2017 % change % change (constant currency) Full-year 2018 (US$ millions)
Managed services-UK, Europe and Australasia £1,154.6 £1,019.4 13.3% 13.3% $1,452.9
Specialist staffing-UK, Europe and Australasia £800.0 £811.9 -1.5% -1.5% $1,006.7
Managed services-North America £183.3 £187.2 -2.1% -0.8% $230.7
Specialist staffing-North America £198.3 £213.8 -7.2% -1.8% $249.5

North America managed services and specialist staffing revenue both fell on a constant currency basis. US managed services was down due to the timing of wins and losses. The company reported the merger in October of its US and UK talent acquisition and managed solutions businesses — rebranded as Guidant Global — has “accelerated the transformation” of Impellam’s portfolio and enabled the expansion of one client from the US to the UK as well as a further new client win.

Specialist staffing in the US noted good performances from technology.

Earlier this year, the company also announced that it plans to demerge subsidiary Carlisle Support Services Group Ltd., in order to focus on its managed services and specialist staffing portfolio.

Share price and market cap

Impellam shares closed down 15.14% to £464.60; the company had a market cap of £270.22 million, according to FT.com.


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