Harvey Nash performed ahead of budget in the first quarter

Recruitment specialist Harvey Nash said it performed ahead of budget during the first quarter to end-April. Revenue rose 18% and gross profit 6%, driven by a greater proportion of flexible labour services in the business mix.

Operating profit, stated before non recurring items and the investment made in two new offices, is 10% ahead of last year.

The Group is also relocating its London office achieving approximately £0.8m of annualised like for like savings, at a one-off cost of circa £0.6m.

Trading in US markets remains encouraging with good growth seen in the first quarter. UK and European trading is more modest, while Outsourcing continues to perform well.

The group announced today the acquisition of the entire issued share capital of Talent-IT BVBA, a Belgium based IT project and recruitment company, for an initial cash consideration of €1.7m. Talent-IT is headquartered in Antwerp and specialises in providing clients with flexible-working, highly skilled IT professionals for their permanent or project based vacancies.

In the year ended 31 December 2011, Talent-IT and its wholly owned subsidiary Team4Talent BVBA reported a combined profit before taxation of approximately €0.7m, turnover of approximately €11.3m and as at 31st December 2011 had gross assets of €4.4m and net assets of €0.5m.

The Harvey Nash Group has no term debt and continues to enjoy overall banking facilities of circa £40m.

Subject to approval at the ABM on 28th June 2012, and as previously announced, the Group proposes to pay a final dividend for the year of 1.635p per share.

This marks an increase of 10% on the dividend for the same period in 2011 of 1.48p. The total dividend of 2.66p per share for the year represents an increase of 10% on 2010/11 (2.42p).

Results for the year ended 31st January 2012 exceeded expectations as the Group benefited from its broad portfolio of services, strong geographic footprint and significant market share gains.

The outlook for freelance contracting remains encouraging with little evidence of a slowdown. As a result, the Board is pleased to report that underlying organic first quarter trading is on track and the acquisition of Talent-IT is expected to contribute an additional 5% increase to Group PBT (before non-recurring items) this year and a 10% increase next year.

Albert Ellis, CEO, said: "We are delighted with the first quarter financial results given the economic uncertainty right now. We are also very pleased with the acquisition of Talent-IT which when merged with our existing successful Harvey Nash business, the merged entity will be the clear market leader in Technology recruitment in the profitable Benelux region."

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