AWF annual profit falls 23% on goodwill writedown, sales rise

AWF Group, the contract labour company, reports a 23% fall in net profit as it writes down the value of its goodwill, even though sales rose by 19%.

BUSINESSDESK: AWF Group, the contract labour company, reported a 23% fall in net profit as it wrote down the value of its goodwill, even as sales increased 19%.

Net profit fell to $2.6 million in the 12 months ended March 31 from $3.2m the previous year. That included non-cash accounting adjustments from amortisation and an impairment charge on goodwill.

AWF's sales rose to $119.2m from $95.8m, beating the $100m target announced in October.

"The company saw an increased demand for recruitment and placement of high caliber temporary and permanent staff with both existing and new customers," chief executive Mike Huddleston said.

The shares climbed 8.3% to $2.60 in trading yesterday.

The result included full-year earnings from the group's acquisition of Panacea, which operates in the healthcare sector, and mining sector business AWF Mourant.

It only includes two months trading from the recently acquired Tradeforce.

The Auckland-based company's earnings before interest, tax, depreciation and amortisation (EBITDA) rose about 27% to $7.4m.

Underlying earnings, which strip out non-cash items, climbed about 27% to $4.6m.

The board announced it will pay a final dividend of 8 cents per share. That takes the total annual payment to 13 cents per share for the year, up from 10.2 cents in 2011.