Impellam anticipates lower earnings following 'subdued' period

27th Sep 2018 12:35

(Sharecast News) - Managed services and specialist staffing firm Impellam Group saw its shares dive on Thursday after a "subdued" period of trading led the board to expect lower earnings than last year.The firm released a trading update which cited the "challenging" nature of the NHS market, which has been impacted by a reduction in spending and IR35 tax legislation, as a major driver behind its current issues, with the retail sector also described as problematic."The seasonal uplift that we would expect to see in the retail market after the end of the summer period has not yet happened, as many of our retail customers continue to experience difficult trading conditions. We also continue to be affected more generally by the uncertainty around Brexit negotiations," the company said.Exchange rates have also caused problems for the company, as non-UK businesses represent 50% of its total EBITDA.As such, Impellam reported that EBITDA for the current financial year is expected to be lower than in 2017, but the company remains confident in its strategy.To this end, its managed services businesses in the UK and Australia are growing ahead of expectations as is its entire US business, on a like-for-like currency basis.Meanwhile, the company reported that chief financial officer Alison Wilford will leave the company on October 31 to take up the same role in a privately held company.Julia Robertson, chief executive of Impellam, said "The board and I would like to thank Alison for her contributions during her 3 years with Impellam, the last 2 years as the group's chief financial officer. We wish her every success in the future.''Consequently, Impellam has appointed Brian Porritt as interim chief financial officer, a non-board role, until Wilford's replacement has been recruited.Impellam's shares were down 16.94% at 515.00p at 1236 BST.