Parity Group plc ("Parity" or the "Group" or the "Company"), the data and technology focussed professional services business, announces its full year results for the year ended 31 December 2020.
· Transformation begun in 2019 is complete and the business returned to an Operating Profit in 2020 of £23k (2019: Operating loss of £725k).
· Removed £4.2m of operating costs, enabling £1.6m to be invested back into the business.
· Significantly improved operational gearing with new operating model.
· Reduction of staff numbers and headcount costs has enabled investment in people who bring new skills.
· Updated team's incentives to be geared towards profitable growth, managing down reliance on revenues that delivered little or no margin.
Post period end and outlook
· Encouraging start to 2021, with new business wins including a contract from the Scottish government representing a total opportunity of up to £5m over the next three to six years, plus a number of other public and private sector wins amounting to an estimated £400,000 in External contribution during the financial year.
· Having significantly improved its working capital management over the past two years the Group has secured a new debt facility from Leumi ABL that will support its future growth ambitions.
· Investment in technology has enabled greater efficiency, stronger margins and supports the growth opportunity, with more future plans in this area.
· While the short-term economic impacts of the pandemic have affected performance, in the longer term it has accelerated the trends that underpin Parity's new strategy.
· If the pandemic eases as expected, anticipate more growth in H2 2021 as business confidence returns.
Year ended 31 December
Operating profit before non-underlying items
Operating profit / (loss)
Adjusted profit before tax
Loss before tax
Net cash excluding lease liabilities
Commenting on the results, John Conoley, Non-Executive Chairman of Parity Group plc, said:
"I am delighted to see the real progress made in 2020 and it is especially pleasing to be able to report a second half profit in 2020. In 2019 the Board made a decision to change the strategic direction of the business, to focus on the growing opportunity in data and to position Parity as the partner of choice for clients who want to realise the true potential of their data. Clearly despite the challenges of the pandemic, the change in strategic direction was the right decision and the growth in profitability should continue. This is my last statement as Non-Executive Chairman of Parity Group plc and I leave Parity in a strong position."
Matthew Bayfield, Chief Executive, said:
"Despite the Covid-19 pandemic we have been able to deliver an operating profit in 2020 and report a profit before tax in the second half of 2020, which is testament to the viability of our new strategy and to the dedication and skill of our people, who I would like thank for their hard work during a very challenging time.
"Whilst the pandemic has made this year difficult for many businesses, it has also underlined the need for strong data management and data governance in businesses and government bodies. This is exactly where Parity sits and where we see opportunity for growth. We are now operating in a truly digital economy sooner than we expected and Parity is extremely well placed to benefit from this. We are more confident than ever in our ability to deliver above average total shareholder returns in the coming years, despite the lasting impacts of the pandemic."
Matthew Bayfield, CEO and Mike Johns, CFO will provide a live presentation relating to the final results for 2020 via the Investor Meet Company platform on 21st Apr 2021 at 1:00pm BST.
The presentation is open to all existing and potential investors. Questions can be submitted pre-event via the Investor Meet Company dashboard up until 9am the day before the meeting or at any time during the live presentation.
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