Cpl Resources : Headline Final results 2017

Results for the Full Year Ended 30 June 2017

Highlights

• Proposal to return €25 million in capital to all shareholders by way of a Tender Offer

• Revenue increased by €21.8 million, to €455.2 million

• Gross Profit increased by 3% to €71.8 million

• 3% increase in Profit before tax to €15.8 million

• Earnings per share of 43.7 cent (2016: 43.9 cent)

• Total dividend per share of 11.5 cent (2016: 11.0 cent) John Hennessy, Chairman commented:

"The Group's results for the year ended 30 June 2017 show growth in revenue and profit before tax, reflecting expansion of our team, development of our service offering and broadening of our geographical footprint.

In recent months, the Board has considered a range of strategic and financial options to enhance shareholder value, particularly taking account of the continued generation of positive cash flows by the Group. Cpl remains a profitable, cash generative business and has built up a net cash position of €33.6 million as at 30 June 2017. Following careful consideration and having taken appropriate advice, the Board has determined that a return of surplus capital is in the best interests of shareholders. Consequently, subject to shareholder approval, we intend to return up to

€25 million of surplus capital, in the form of a tender offer, to shareholders

The Board is recommending a final dividend of 5.75 cent per share. This will bring the total dividend for the year to 11.5 cent per share.Based on current trends and circumstances in our main markets we expect to deliver further growth in our business during the financial year to 30 June 2018."

Anne Heraty CEO added:

"We continued to grow our international footprint opening offices in Munich and Boston during the year. We now have over 40 offices in 10 countries. These offices provide Cpl clients with the international reach they need especially in resourcing local talent. We also made further strategic progress with the acquisition of RIG Healthcare Group. This is Cpl's first entry into the locum doctor market and enhances the Company's operating presence in the UK, following the acquisition of Clinical Professionals in September 2015.

We will continue to invest wisely to capture opportunities for growth. Cpl has a strong balance sheet with net assets of €103.7 million generated over the 27 years of continuous profitability. We believe our balance sheet and strong cash flows give us the resources to invest in the growth and expansion of our business while also returning capital to shareholders."

This announcement contains inside information

For Further Information:

Anne Heraty, CEO, Cpl Resources Plc: +353 1 614 6000

Mark Buckley, CFO, Cpl Resources Plc: +353 1 614 6000

Ivan Murphy/ Daragh O'Reilly, Davy Corporate Finance: +353 1 679 6363

Melanie Farrell/ Jonathan Neilan, FTI Consulting: +353 1 765 0888

Cpl Resources Plc

The financial year ended 30 June 2017 has been a year of growth in revenue and profit before tax for Cpl.

Highlights of the Group's performance include:

• Revenue increased by €21.8m to €455.2m

• Gross Profit increased by 3% to €71.8m

• 3% increase in Profit before tax of €15.8m

• Earnings per share of 43.7 cent

• Total dividend per share of 11.5 cent

• Proposal to return €25 million in capital to all shareholders by way of a Tender Offer

* as % of gross profit

The Group's results for the year ended 30 June 2017 show growth in revenue and profit before tax, reflecting expansion of our team, development of our service offering and broadening of our geographical footprint.

Our revenue grew by €22 million in the financial year, up 5% on the prior year, and Group gross profit and profit before tax grew by 3% in the year. The demand for talented temporary staff among our clients grew at a stronger pace than for permanent employees across most sectors during the year, with temporary fees growing by 12%. The demand for permanent staff was adversely affected by changes in regulation in the healthcare sector and concerns about Brexit, which slowed recruitment decisions by certain employers. Our profit before tax is modestly ahead of the prior financial year, which, in light of the changed mix of business between temporary and permanent recruitment in the year, is a positive performance.

At year end, the Group had a strong balance sheet, with net assets of €104 million at 30 June 2017, up from €94 million in the prior year. We ended the year with net cash of more than €33 million, after investing €10 million in RIG Healthcare Group and funding the working capital demands arising from the continued growth in our temporary business. It is in this context that we are pleased to announce the intention to return capital to shareholders by way of a tender offer.

In recent months, the Board has considered a range of strategic and financial options to enhance shareholder value, particularly taking account of the continued generation of positive cash flows by the Group. As part of this the Board has, and will continue to, review acquisition and investment opportunities which may optimise value for shareholders and in June this year we were pleased to announce the acquisition of a 91% shareholding in RIG Healthcare Group.

Cpl remains a profitable, cash generative business and has built up a net cash position of €33.6 million as at 30 June 2017. Following careful consideration and having taken appropriate advice, the Board has determined that a return of surplus capital is in the best interests of shareholders.

Consequently, subject to shareholder approval, we intend to return up to €25 million of surplus capital, in the form of a tender offer, to shareholders (the "Tender Offer"). As was the case in the Group's previous return of capital to shareholders in 2011, the return of capital will be made by way of a fixed price tender offer structure. The Tender Offer will be made at a price per Ordinary Share of €6.75 (the "Tender Price").

The Board believes that a return of capital in the amount proposed represents the most effective use of those shareholder funds and that the continued strength of the Group's balance sheet, and its cashflow generation after the return of those funds, will be sufficient to pursue the Group's stated growth objectives. The Tender Offer provides all shareholders with choice (that is, the discretion to participate) and certainty of value. Those shareholders who do not wish to participate can retain their full existing investment in the company.

Further details on the Tender Offer are included in the section entitled "Proposed Tender Offer".

Once again our people have delivered outstanding service to our clients and candidates during the year. The continuous growth in our business poses challenges to our teams, and they have responded well to these challenges. Our customers continue to give us very positive feedback on the service they receive.

On behalf of the Board, I would like to thank all of our people for their commitment, dedication and hard work, delivered daily for the benefit of the whole Group. I also wish to thank our clients and candidates for their continued support, their valuable input and their loyalty to our business.

In March 2017, Colm Long was appointed to the Board as an independent non-executive director. Colm has extensive experience of media and digital businesses and has contributed very positively to the Board since his arrival. We are delighted to welcome him and look forward to working with him in the future.

As the Group embarks on its next phase of growth, the Board has appointed Mark Buckley, current CFO, to the position of Deputy CEO and COO for the Group, with responsibility for operational performance and delivery of service to clients. We look forward to working with Mark as he takes on these important roles.

I am also delighted to announce that Lorna Conn has been appointed CFO of the Cpl Group. The Board and management look forward to working with Lorna, who will join us on 2 October 2017.

Cpl has delivered earnings per share in the twelve months to 30 June 2017 of 43.7 cent. The Group also has a progressive dividend policy which reflects underlying earnings growth and our continued financial strength.

The Board is recommending a final dividend of 5.75 cent per share. This will bring the total dividend for the year to 11.5 cent per share. The dividend, if approved by the shareholders, will be