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Staffline - Very stong H2 likely

October 2012

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • STAF
  • Price:
  • 227p
Staffline's H1 results to 30 June contained few surprises. Sales were up 36% to £163.9m. Operating profit was flat at £3.8m whilst pretax profit down by £0.1m to £2.8m due to higher interest charges (net debt £8.4m). Eps was 12p. The reason for the massive jump in turnover but not profit is the inclusion of the Work Programme contract, the government initiative to reduce long-term unemployment. This contract, which is running in Birmingham and the Black Country, recorded a £0.4m loss on sales of £5.5m, which offset improved profits on the core blue-collar recruitment business. Overall 4,500 people passed through the scheme (DWP restriction prevents Staffline from disclosing exactly).The core recruitment business, whi ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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