FINANCIALS: Hydrogen ready for lift off
17 March 2014
The chairman of global specialist recruitment company Hydrogen Group says he is hopeful the company’s strategy of investing for the medium term will begin to pay off, starting this year.
Mon, 17 Mar 2014
The chairman of global specialist recruitment company Hydrogen Group says he is hopeful the company’s strategy of investing for the medium term will begin to pay off, starting this year.
As Hydrogen Group announced a 25% fall in pre-tax profit to £2.4m for 2013 from £3.2m in 2012, Ian Temple tells Recruiter: “We have invested a lot ready for the much forecasted upturn. We are ready for it but in terms of profitability and real top-line growth we are not yet there.”
During 2013 administration costs increased by 5% to £29.4m, due largely to IT and infrastructure costs from opening news offices in Houston, US, and Stavanger, Norway, and a new London headquarters. Headcount of 383 at the end of 2013 was 4% up on a year previously.
“We hope to get momentum this year and increase this in the next few years… Our strategy is not predicted on the short term, it’s a medium-term strategy,” says Temple.
Tim Smeaton, Hydrogen’s chief executive officer, adds: “We recognised that the immediate impact of this increased investment could be a reduction in short-term profits. We remain confident that, with our current focus on growth and our high operational gearing, we are well positioned to scale up the business.”
Temple says that Asia and Singapore are particularly promising markets. Last year Singapore grew its net fee income (NFI) by 24%. “We have got critical mass there,” he says. Hydrogen’s Houston office is also performing strongly, albeit “coming from a low base”, he adds.
According to a company statement accompanying the results, “one of the main pillars of the 2016 strategy is a growing international presence to reduce the reliance on UK revenues”.
However, the results show that this is already happening, with UK NFI declining by 3% in 2013, and NFI from outside the UK rising by 9% to £13.9m.
However, Hydrogen’s international performance was patchy, with Australia seeing a 19% decline in NFI. “All the signs are of another tough years in Australia,” says Temple.
Temple says the main risk to the company not achieving its targets is that the anticipated recovery in the company’s traditional sectors, finance, particularly financial services and technology “don’t come through”.
Financial highlights
Revenue +9% £181.6m (2012: £167m)
Net fee income + 2% £31.9m (2012: £31.3m)
Profit before tax -25% £2.4m (2012: £0.2m)
International NFI +9% making up 44% of total (2012: 41%)
17% increase in technical and scientific business
Contract NFI +5% to £16.9m
As Hydrogen Group announced a 25% fall in pre-tax profit to £2.4m for 2013 from £3.2m in 2012, Ian Temple tells Recruiter: “We have invested a lot ready for the much forecasted upturn. We are ready for it but in terms of profitability and real top-line growth we are not yet there.”
During 2013 administration costs increased by 5% to £29.4m, due largely to IT and infrastructure costs from opening news offices in Houston, US, and Stavanger, Norway, and a new London headquarters. Headcount of 383 at the end of 2013 was 4% up on a year previously.
“We hope to get momentum this year and increase this in the next few years… Our strategy is not predicted on the short term, it’s a medium-term strategy,” says Temple.
Tim Smeaton, Hydrogen’s chief executive officer, adds: “We recognised that the immediate impact of this increased investment could be a reduction in short-term profits. We remain confident that, with our current focus on growth and our high operational gearing, we are well positioned to scale up the business.”
Temple says that Asia and Singapore are particularly promising markets. Last year Singapore grew its net fee income (NFI) by 24%. “We have got critical mass there,” he says. Hydrogen’s Houston office is also performing strongly, albeit “coming from a low base”, he adds.
According to a company statement accompanying the results, “one of the main pillars of the 2016 strategy is a growing international presence to reduce the reliance on UK revenues”.
However, the results show that this is already happening, with UK NFI declining by 3% in 2013, and NFI from outside the UK rising by 9% to £13.9m.
However, Hydrogen’s international performance was patchy, with Australia seeing a 19% decline in NFI. “All the signs are of another tough years in Australia,” says Temple.
Temple says the main risk to the company not achieving its targets is that the anticipated recovery in the company’s traditional sectors, finance, particularly financial services and technology “don’t come through”.
Financial highlights
Revenue +9% £181.6m (2012: £167m)
Net fee income + 2% £31.9m (2012: £31.3m)
Profit before tax -25% £2.4m (2012: £0.2m)
International NFI +9% making up 44% of total (2012: 41%)
17% increase in technical and scientific business
Contract NFI +5% to £16.9m
