Cpl shares fall sharply after 13pc profit dip
Shares in Dublin-listed recruitment company Cpl Resources plummeted yesterday after it announced a 13pc fall in pre-tax profit in the six months ending December 31.
The shares closed down 18.6pc at €5.25 each.
The profit dip comes after the company ramped up investment in its operations. It was broadly in line with analysts' forecasts.
The company - spearheaded by former Anglo-Irish Bank non-executive director Anne Heraty - saw its revenue jump 5pc in the period.
"We are experiencing gradual improvements in market conditions, although significant pricing challenges and economic headwinds are being experienced in a number of sectors and locations," Cpl chairman John Hennessy said in a statement released yesterday.
"Margin pressure continues across the temporary staffing market and this market segment remains highly competitive.
"The Cpl team has continued to work closely with our clients to understand their specific requirements and with our candidates in order to match their skills to those client requirements," Mr Hennessy said.
Analysts revised their profit forecasts downwards after the statement was released.
"Economic uncertainty combined with competitive and client pressures are causing challenges for the company," Davy's Ross Harvey said.
Mr Harvey said Davy now forecasts a full-year pre-tax profit of €13m for Cpl. In its last fiscal year the company made a pre-tax profit of €14.4m.
The company said it had significantly increased investment in the business "in order to be well positioned to take advantage of expected improvements in our key markets."
"Our strong financial position will provide us with the resources to capitalise on growth opportunities as they arise," Mr Hennessy said.
Cpl's gross profit rose 5pc in the period. Gross profit from permanent job placements rose 11pc to €11.2m in the six-month period.
Over 40pc of the company's fees from permanent placements came from outside Ireland.
Gross profit on temporary job placements was €17.1m, a 1pc jump.
Cpl employs over 7,400 people and is based in Percy Place, Dublin 4.