Lower blue collar revenue offsets strong first half profit

Level 6, 51 Shortland Street
PO Box 12832, Penrose, Auckland 1642
Tel 09 526 8770 Fax 09 579 0224
awfmadison.co.nz
MEDIA RELEASE
29 October 2018
Lower blue collar revenue offsets strong first half profit growth from white collar
 Revenue down 1% to $141.6 million
 EBITDA down 27.4% to $5.2 million (refer note 1 below)
 Net profit after tax down from $3.4m to $2.1 million
 White collar segment earnings increased 14.4% to $3.9 million
 AWF segment earnings fell $2.2 million to $1.0 million
 Interim Dividend steady at 8.0 cents per share
One-off costs associated with the failure of three construction industry customers’ have impacted revenue and
profit contribution from AWF Madison Group’s (“Group”) blue collar business, AWF, in the six months to
September 2018.
However, continued strength in the New Zealand economy helped revenue and profit to grow strongly in the
Madison Recruitment and Absolute IT white collar businesses, resulting in flat Group revenue.
As advised to the market on 16 October, three debtors in Auckland and Christchurch were placed into
liquidation.
The Group has provided $800,000 for doubtful debts associated with these businesses. In addition, the Group
incurred approximately $1.0 million in costs related to redeploying migrant workers assigned to those
businesses; and delays in the initial deployment of migrant workers within the first six months of arrival, due to
mismatch of skills with client workflow.
During the period, strong cash flow allowed the Group to repay $3.0 million of bank debt. Tighter debtor
management enabled the Group to reduce trade receivables to $35.4 million, from $41.8 million at 31 March
2018.
In September, subsidiary company AWF Limited, paid $666,000 to acquire Select Dunedin from Select
Recruitment Ltd.
“The purchase of Select Dunedin expands our presence in temporary staffing and permanent recruitment in the
Dunedin region, and is immediately earnings-accretive,” said AWF Madison CEO Simon Bennett.
A fully-imputed Interim Dividend of 8.0 cents per share (unchanged from 2017) will be paid on 3 December
2018, to shareholders on the register at close of business on 19 November 2018 (the Record Date).
The Dividend Reinvestment Plan (DRP), which was introduced during the last financial year (and applied to the
31 March 2018 Final Dividend when 402,412 new Ordinary shares were issued, worth $773,000), will apply to
the Interim Dividend. The Board has determined that up to 50% of this Interim Dividend will be allowed to
participate in the forthcoming distribution.
Shareholding Directors have, again, committed to participate to the full extent of their respective entitlements
under the DRP, as they did in July; and, as a mark of their confidence in the business, have signified their
intention to purchase additional Ordinary shares during the applicable trading window.

Level 6, 51 Shortland Street
PO Box 12832, Penrose, Auckland 1642
Tel 09 526 8770 Fax 09 579 0224
www.awfmadison.co.nz

For the Board
Ross Keenan: Chairman Simon Bennett: CEO

Contact: Simon Bennett, CEO (09) 917 1010

Ends

Note 1 Reconciliation – EBITDA to Profit before tax
EBITDA is a non-generally accepted accounting principle term and reconciles to reported Profit before tax as
follows:







30-Sep-1830-Sep-17
EBITDA5,1527,093
Depreciation and amortisation expense1,6421,864
Finance costs637741
Profit before tax2,8734,488
$000'S
6 months

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Appendix 1
2.1
2.2-a
2.2-b
2.2-c
2.2-d
2.2-e
2.2-f
3.1
3.2
3.3
3.4
3.5
1.3(l)
2.3(a)
Revenue141,577 143,078
Investment revenue- -
Fair value gain on settlement of Absolute IT Ltd earn-out- -
Direct costs(1,752)(986)
Employee benefits expense(128,735)(129,001)
Depreciation and amortisation expense(1,642)(1,864)
Impairment- -
Other operating expenses(5,938)(5,998)
Finance costs(637)(741)
Acquisition related expenses- -
Profit before tax2,873 4,488
Income tax expense(821)(1,070)
Profit for the period2,052 3,418
Discontinued operations
Profit/(loss) from discontinued operations- -
Profit for the period2,052 3,418
Other comprehensive income- -
Total comprehensive income for the period, net of tax2,052 3,418
Profit for the year is attributable to:
Equity holders of the parent2,052 3,418
Non controlling interests- -
2,052 3,418
Total comprehensive income is attributable to:
Equity holders of the parent2,052 3,418
Non controlling interests- -
2,052 3,418
Earnings per share
Total basic earnings per share (cents/share)6.310.5
Consolidated Income Statement
Reporting Period
Previous
Corresponding
Period
$NZ'000$NZ'000
There are no material changes in accounting policies applied in the preparation of the financial statements.
The full year financial statements have been audited.
All statements are prepared in accordance with New Zealand Equivalents to International Financial Reporting
Standards.
There are no accounting policies which the directors believe are critical to the portrayal of AWF Madison Group
Limited's financial condition and results and which require the directors judgements and estimates about matters that
are inherently uncertain.
The interim financial statements have not been audited
See attached file for further comment
Comments
Dividend Payment Date3-Dec-18
See attached file
2,052-40.0%
Record Date19-Nov-18
Interim/Final Dividend
Amount per securityImputed amount per
security
Interim8.0 cents3.111
Full Year Preliminary Announcement
AWF Madison Group Limited
Results for announcement to the market
Reporting PeriodSix months to 30 September 2018
Net profit/(loss) attributable to security holders2,052-40.0%
Profit/(loss) from ordinary activities after tax attributable to security holder
Previous Reporting PeriodSix months to 30 September 2017
Amount
Revenue from ordinary activities141,577-1.0%
$NZ'000Percentage change
NZX App 1 - Pg.1/4

Appendix 1Full Year Preliminary Announcement
AWF Madison Group Limited
Results for announcement to the market
Total diluted earnings per share (cents/share)6.310.5
NZX App 1 - Pg.2/4

Appendix 1Full Year Preliminary Announcement
AWF Madison Group Limited
Results for announcement to the market
Issue of Share Capital773 -
Treasury shares conversion & cancellation costs- -
Share based payments83 (22)
Total transactions with shareholders(1,848)(2,498)
2.3(b)
Assets
Non-current assets
Property, plant and equipment3,279 2,498
Goodwill (Prior year comparative restated)39,411 38,620
Other intangible assets14,845 16,079
57,535 57,197
Current assets
Cash and cash equivalents5,669 6,269
Trade and other receivables35,429 41,830
Taxation receivable145 -
41,243 48,099
Total assets98,778 105,296
Equity and liabilities
Capital and reserves
Share capital28,371 27,598
Treasury account- -
Equity-settled employee benefits reserve466 383
Retained earnings8,226 8,878
Equity attributable to equity holders of the parent37,063 36,859
Total equity37,063 36,859
Non-current liabilities
Deferred tax Liabilities2,680 2,748
Borrowings33,000 36,000
35,680 38,748
Current liabilities
Trade and other payables25,835 28,867
Bank Overdraft- -
Borrowings- -
Taxation payable- 622
Provisions200 200
Absolute IT Limited earn-out payment- -
26,035 29,689
Total liabilities61,715 68,437
Total equity and liabilities98,778 105,296
$NZ'000$NZ'000
Consolidated Balance Sheet
Reporting Period
Previous
Corresponding
Period
Treasury shares converted- 229
Equity at end of period37,063 37,856
Dividends paid(2,704)(2,705)
Equity at beginning of period36,859 36,936
Profit for the period2,052 3,418
Consolidated Statement of Changes in Equity
Reporting Period
Previous
Corresponding
Period
$NZ'000$NZ'000
NZX App 1 - Pg.3/4

Appendix 1Full Year Preliminary Announcement
AWF Madison Group Limited
Results for announcement to the market
2.3(c)Consolidated Cash Flow Statement
Cash flows from operating activities
Receipts from customers146,810 154,350
Payments to suppliers and employees(138,373)(138,915)
Net cash generated from operations8,437 15,435
Interest Received- -
Interest paid(638)(741)
Income taxes paid(1,656)(2,815)
Net cash from operating activities6,143 11,879
Cash flows from investing activities
Proceeds on disposal of property, plant and equipment36 72
Payments for property, plant and equipment(1,122)(248)
Payments for other intangible assets(60)(27)
Acquisition (666)-
Net cash from/(used in) investing activities(1,812)(203)
Cash flows from financing activities
Proceeds from the issue of share capital773 229
Share issue costs- -
Dividends paid(2,704)(2,705)
Proceeds from borrowings(3,000)-
Repayment of borrowings- -
- -
Net cash from/(used in) financing activities(4,931)(2,476)
Net increase/(decrease) in cash held(600)9,200
Cash and cash equivalents at start of the year6,269 1,117
Net cash and cash equivalents at end of the year5,669 10,317
2.3(d)Final Dividend
Payment Date
Number of shares on issue (ordinary plus restricted)
Dividend per share$NZ
Total dividend monies
2.3(e)
2.3(f)Net Tangible Assets per Security
Net Tangible Assets$NZ '000
Net Tangible Assets per Security$NZ
2.3(g)Acquisitions/Disposals
Acquisition
Entity name
Control gained or lost
Date of gain or loss of control
Contribution to profit$NZ '000
Disposal
Entity name
Control gained or lost
Date of gain or loss of control
Contribution to profit$NZ '000
2.3(h)There are no associate or joint venture entities at the reporting date.
- -
- -
-$ 0.43-$ 0.46
Reporting Period
Previous
Corresponding
Period
(14,513)(15,092)
Reporting Period
Previous
Corresponding
Period
A dividend reinvestment plan is in operation.
$ 0.080$ 0.080
$2,670,289$2,644,575
3 December 201827 November 2017
33,378,60833,057,193
$NZ'000$NZ'000
Reporting Period
Previous
Corresponding
Period
Reporting Period
Previous
Corresponding
Period
Repayment of vendor on settlement of Absolute IT Limited earn-out
payment
NZX App 1 - Pg.4/4

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Ordinary and Restricted SharesNZAWFE0001S8
EMAIL: announce@nzx.com
Notice of event affecting securities
AWF Madison Group Limited
David LazarusDirectors Resolution
09-526-877509-526-266326102018
Enter N/A if not
applicable
In dollars and cents
Retained Earnings
$0.080000
NZD
$2,670,289
Date Payable
$$0.005556$0.031111
$
19 November, 20183 December, 2018