Parity Group PLC – PTY – Interim results

Parity Group PLC – PTY – Interim results

Parity Group plc (“Parity” or the “Group” or the “Company”), the data and technology focussed professional services business, announces its half year results for the six months ended 30 June 2020.

Headlines:

·    Return to a more active market post the initial Covid related downturn in H1. Recent new business wins include:

o  Parity has been granted two new lots on the Digital and Technology Services Dynamic Purchasing System for the Scottish Government. The framework agreement covers the provision of high-end digital specialists and cyber security specialists.

o  In partnership with CyberGym, Parity has won a place on the Northern Ireland Co-Operation Overseas (NI.CO) Cyber Security Training Services Framework to provide consultancy and recruitment support.

o  The Company has also started work on various permanent roles covering data and digital specialist roles in international markets.

·    Transformation programme effectively complete with annualised gross operating cost savings achieved in excess of £4m. No material non-underlying costs anticipated in H2.

·    After £1.8m of re-investment in transformation, including IT infrastructure, recruitment and marketing, net annualised operating costs have reduced by £2.4m, the full impact of these savings to be felt in 2021.

·    Wind down of low-margin Scottish government contract still contributing to reduction in net revenue from (£6.1m in H2 2019 to £5.3m H1 2020) but adjusted operating profit now growing, £0.03m in H2 2019 to £0.25 in H1 2020

·    The Board anticipates the 2020 full year adjusted profit before tax will be similar to that achieved in 2019 of £115,000.

·    Net cash before lease liabilities as at 30 June 2020 of £0.65m compared to net debt before lease liabilities of £1.17m as at 30 June 2019.

 

  

Key Financials

For the six months ended 30 June 2020

 

Six months

to 30.06.20
(Unaudited)

 

£’000

Six months

to 30.06.19

(Unaudited)

(Restated)

£’000

Year

to 31.12.19

(Audited)

(Restated)

         £’000

Revenue

29,949

44,514

80,409

Net revenue

5,339

7,541

13,616

Operating profit before non-underlying items

246

414

447

Adjusted profit before tax1

61

203

115

Loss before tax

(383)

(541)

(1,057)

Net cash/(debt) excluding lease liabilities

654

(1,174)

1,397

 

1 Profit before tax and non-underlying items

 

 

John Conoley, Non-Executive Chairman of Parity Group plc, said:

“We are pleased to be able to report an adjusted profit before tax in the first half year despite the impact of the Covid pandemic. Since the period end we have seen an improvement in market conditions and have converted some important opportunities into new business. The management team and staff are all to be congratulated on how they have responded to the business and personal challenges they have faced this year.”

Matthew Bayfield, Chief Executive, said:

 “We are digital and data specialists and the world is becoming ever more reliant on people with the skills to manage data and to be able to do so remotely. The changes brought on by Covid have brought us opportunities as well as challenges, we have remained close to our clients and are benefitting from not having furloughed any of our staff.

“With more remote working, cyber security has become an even more critical business function and we are well placed to help our clients manage their needs in this area. Working with CyberGym we see particularly strong growth opportunities in this market segment.

“The Company is now much closer to being where we set out to be when I became CEO eighteen months ago. We are leaner and more efficient, are clearer in our market position and have recruited a team who can deliver on the business plan, our prospects are good.”

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