Engineer recruitment specialist Morson expects 2012 will be another tough year, with margins under pressure, after it saw profits fall in 2011.
The UK provider of technical contracting personnel to the technical industries saw adjusted pre-tax profit fall 12.4% to £7.1m in 2011 from £8.1m the year before. This was partly the result of a rise in the cost of sales, while 2010 saw a one-off net gain on acquisition of business.
Group revenues rose 11.0% to £507.9m from £457.6m the year before, while group net fee income was up 10.9% to £38.9m from £35.1m in 2010.
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Basic earnings per share were down 36.2% from 15.69p to 10.01p.
Net debt at year end was up 43.7% to £33.3 m from £23.2m at the end of 2010. With debt and working capital requirements on the rise, the dividend has been sacrificed, as previously announced back in December.
Gerry Mason, Non Executive Chairman, said: "We expect our core markets to remain solid but margin pressures to continue. We have several key contract renewals and extensions that fall due in 2012 and will be focused on achieving these, developing service capabilities and expertise and planning for the longer term growth of the business.
"Aerospace, particularly on the civil side, is performing well and remains the largest business sector for us. Rail has recently seen government support for further future rail improvement programmes. We expect nuclear power to become a key contributor to the UK's energy needs and that there will be an increasing resource requirement in the near future entailing not just new nuclear stations but also the site support facility, control environment and the upgrading work needed on the UK power transmission grid and infrastructure."
The share price fell 1.18% to 42.00p.
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