Nakama (AIM:NAK) announces its final audited results for the year ended 31 March 2020, together with the publication of its annual report and accounts (the "Annual Report").
The Company will post the Annual Report to shareholders this week and make a copy available on its website www.nakamagroupplc.com.
· Group revenue decreased by 27.5 per cent. to £9.7m (2019: £13.4m)
· Net fee income reduced by 29.5 per cent. to £2.9m (2019: £4.1m)
· Net fee income percentage decreased to 30.0 per cent. (2019: 30.8 per cent.)
· Operating profit moved to a loss of £182,000 (2019: profit £91,000)
Nakama Group plc
Tim Sheffield, Chairman
00 44 20 7236 2400
Robert Thesiger, Chief Executive Officer
00 44 20 3588 4560
Allenby Capital Limited (Nominated Adviser and Broker)
00 44 20 3328 5656
Nick Naylor / Liz Kirchner
Nakama Group's strategy is to support the talent acquisition programmes of high growth companies across multiple industries. We provide permanent and contract recruitment solutions to a broad range of clients across Europe and Asia Pacific geographies.
The primary objective of the executive management team is to focus on delivering acceptable returns for shareholders and take advantage of the opportunities in the sectors in which we operate.
2020 has been another challenging period for the Group: the onset of COVID 19 has had an immediate impact on the group and has seen trading decline accordingly. As a business we took immediate and decisive action which saw us take advantage of the various government support schemes. We immediately implemented a working from home strategy and reduced our cost base in line with our reduced levels of trading.
In the UK the proposed changes to IR35 (since revised) also had a big impact on our contractor business and the deferral of these changes came too late. As a result, our UK contractor business declined during the year.
Due to the Covid-19 pandemic the Group's revenues for the year ended 31 March 2020 were lower by 27.6% compared to the prior year at £9.7m (2019: £13.4m) and Net Fee Income ("NFI") was 29.3% lower at £2.9m (2019: £4.1m). This reduction in revenue was primarily a result of poor overall consultant performance. We are disappointed not to increase revenues and saw a reduction in EBITDA to negative £76,000 (2019: £424,000).
Outlook and summary
2020 has been an incredibly challenging year, however, I am very proud of the way we have met these challenges and continued to trade. We have recently announced a sale of our trading businesses to Sanderson Group as it has become increasingly clear that without an injection of capital the Group may not be able to continue to trade. Further details of the proposed disposal are set out in a circular sent to shareholders on 10 December 2020. Should the proposed disposal, which is subject to shareholder approval, proceed the Company will become an AIM Rule 15 cash shell. As such, the Company , will either be required to make an acquisition or acquisitions constituting a reverse takeover under AIM Rule 14 on or before the date falling six months from the date of becoming a cash shell or be re-admitted to trading on AIM as an investing company under the AIM Rules (which requires the raising of at least £6 million) failing which, the Company's shares would then be suspended from trading on AIM pursuant to AIM Rule 40. Admission to trading on AIM would be cancelled six months from the date of any suspension should the suspension not have been lifted beforehand.
This has been a difficult journey for the Company and our teams across the Group have worked hard in trying to reposition the business onto a more positive footing. I would like to thank our valued members of staff for their hard work during a prolonged challenging period.
11 December 2020