RTC : Annual Report 2020

Annual Report for the year ended 31 December 2020

Stock code: RTCwww.rtcgroupplc.co.uk

Welcome to the RTC Group Annual Report 2020

Highlights

RTC Group Plc is an AIM listed recruitment business that focuses on white and blue-collar recruitment, providing temporary and permanent labour to a broad range of industries and customers in both domestic and international markets through its geographically defined operating divisions.

UK division

Through its Ganymede and ATA Recruitment brands the Group provides a wide range of recruitment services in the UK.

Ganymede specialise in recruiting the best technical and engineering talent and providing complete workforce solutions to help build and maintain infrastructure and transportation for a wide range of UK and international clients. Ganymede is a market leader in providing a diverse range of people solutions to the rail, energy, construction, highways, and transportation sectors. With offices strategically located across the country, Ganymede provides its clients with the benefit of a national network of skilled personnel combined with local expertise.

Ganymede tailors its solutions to suit its clients' needs. Whether it's recruiting permanent and temporary technical, engineering and safety-critical roles or providing fully managed workforce solutions of recruitment, training, account management, contingent labour and fleet provision, Ganymede works closely with its clients to understand their requirements, keeping their goals in mind every step of the way.

ATA Recruitment provide high-quality technical recruitment solutions to the manufacturing, engineering, and technology sectors. Working as an engineering recruitment partner supporting businesses across the UK, ATA Recruitment has a strong track record of attracting and recruiting the best engineering talent for our clients. ATA's regional offices which are strategically located in Leicester and Leeds each have dedicated market-experts to ensure ATA delivers excellence to both our clients and candidates.

The Group headquarters are located at the Derby Conference Centre which also provides office accommodation for its operating divisions in addition to generating rental and conferencing income from space not utilised by the Group.

International division

Internationally, through our GSS brand we work with customers across the globe that are focused on delivering projects in a variety of sectors. GSS has a track record of delivery in some of the world's most hostile locations.

Working closely with its customers GSS provides contract and permanent staffing solutions on an international basis, providing key personnel into new projects and supporting ongoing large-scale project staffing needs. GSS typically recruit across a range of disciplines and skills from operators and supervisors, through to senior management level.

Learn more

RTC maintains a corporate website atwww.rtcgroupplc.co.uk containing a wide range of information of interest including:

• • latest news and press releases

• • company reports

Contents

Overview

Chairman's statement ........................................................................................................................................................................................ 2

Strategic report

Chief Executive's operational and strategic review ................................................................................................................................. 3

Business model ....................................................................................................................................................................................................... 8

Key performance indicators .............................................................................................................................................................................. 9

Risk Management ................................................................................................................................................................................................ 10

Finance Director's report .................................................................................................................................................................................. 12

Governance

Section 172 statement ....................................................................................................................................................................................... 14

Directors' report ................................................................................................................................................................................................... 16

Corporate governance statement ................................................................................................................................................................. 21

Audit committee report .................................................................................................................................................................................... 24

Remuneration report .......................................................................................................................................................................................... 26

Financial reports

RTC Group

Independent auditor's report to the members of RTC Group Plc ................................................................................................... 28

Consolidated statement of comprehensive income ............................................................................................................................. 35

Consolidated statement of changes in equity ......................................................................................................................................... 36

Consolidated statement of financial position .......................................................................................................................................... 38

Consolidated statement of cash flows ........................................................................................................................................................ 39

Notes to the Group financial statements .................................................................................................................................................. 40

RTC Company

Company statutory financial statements ................................................................................................................................................... 63

Company statement of financial position ................................................................................................................................................. 64

Company statement of changes in equity ................................................................................................................................................ 65

Notes to the Company financial statements ............................................................................................................................................ 66

Shareholder information

Directors and advisers ........................................................................................................................................................... 72

Overview

Chairman's statement

For the year ended 31 December 2020

I am pleased to present the final report for the year.

Group 2020 has been a particularly challenging year with all but the first two months being deeply affected by the rapid onset and escalation of the COVID virus. Nonetheless protective measures commenced during January and decisions on a strategic level to focus on balance sheet preservation and cost control were taken immediately.

Trading in the Group continued to deliver satisfactory results for most of the first quarter but the rumble of thunder, distinctly audible in the first three months, morphed into very difficult conditions from March onwards in certain areas of the business. These were mainly focussed on the Derby Conference Centre and some parts of UK recruitment. The wisdom of our specialisation in infrastructure and international contract recruitment was demonstrated as revenues in railway maintenance in the UK and services to military installations overseas continued with only limited drops in revenues.

As mentioned in our interim statement, we were able to deliver a profit in the period and made valuable improvements in our cash position. The expectation at that time was that the second half would continue to be as difficult as the first and that history told us that there was a considerable possibility of a second wave of infections but we were confident that we could continue to trade profitably. The outcome for the second half and the year as a whole have justified that confidence and we have been assisted by a successfully negotiated conclusion of phase one of our contract to supply smart meter Installation engineers to the electricity supply industry where revenues were guaranteed over the first three years.

During the year full use has been made of Government initiatives established to assist the UK Economy which have assisted all our businesses to continue to operate normally, albeit at reduced levels.

Our UK technical & engineering recruitment operations, now part of Ganymede, had a difficult year in fragile market conditions, but were able to produce a creditable trading result. In other areas, Ganymede continued to prosper with slightly reduced levels of demand in both rail and infrastructure and in the energy division despite the slower than expected growth of our contract to train and supply operatives to serve the roll out of the government smart meter policy.

Our international division, Global Staffing Solutions, continued in line with expectations. However, global travel bans impacted some workforce mobilisation activities.

Capital investment

We continue to invest in the development of our businesses.

Dividends

In the conditions which have unfolded in 2020 it was considered prudent to suspend the payment of dividends and to concentrate on balance sheet improvement in preparation for the expected need to invest in business changes and developments in the future. It is unlikely that we will be recommending a return to payments in the near future.

Staff

I should like to thank our staff at all levels for their loyalty, hard work and enthusiasm during the course of a most taxing year.

Outlook

On a positive note, we remain confident that the present global medical emergency will eventually be put behind us, but we see no signs of that at this time as we pin our hopes on science and vaccines. Notwithstanding that expectation, the process of recovery as it comes is likely to suffer for some time from the aftershocks from these conditions and the inevitable re-shaping of human behaviour coupled with the continued efforts to reduce the carbon footprints of world energy production and consumption and the settling down of our departure from the EU. We believe that we have explored these matters and that we have a roadmap for successful trading in the years to come. The establishment of strong and stable Government, the passing at long last of our exit from the European Union and the establishment of a robust trading arrangement with Europe, give us cause to anticipate more a predictable and promising future.

W J C Douie

WJC Douie, Chairman 21 February 2021

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