The People Infrastructure Ltd (ASX: PPE) share price has faded from its morning gains after the company released its FY21 full-year results.
Shares in the staffing business rallied 8.85% within the first few minutes of trade to a high of $4.55.
At the time of writing, the People Infrastructure share price is up 3.11% to $4.31.
People Infrastructure share price rallies on strong growth in FY21
People Infrastructure grew considerably in FY21, both organically and via acquisitions. Some key highlights include:
- Revenue rose 19% to $444 million
- Underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) jumped 33% to $38 million
- Underlying net profit after tax and amortisation lifted 37% to $25 million
- Final fully franked dividend of 6 cents per share
What happened to People Infrastructure in FY21?
The People Infrastructure share price has been a steady performer in 2021, up 20% year-to-date.
The company completed a number of acquisitions throughout the year to drive greater staffing sector diversification and accretive growth. Companies acquired in FY21 include:
- Ecareer & Illuminate (IT) in December 2020
- Swingshift (Healthcare) in March
- Techforce (Industrial) and Vision Surveys (Op services) in June
All divisions, both organic and acquired, made strong contributions to growth. The company said that in the final quarter of FY21, all divisions were either at or exceeding record profit contribution.
In relation to recent COVID-related restrictions and lockdowns, the company said they impact a portion of clients and in different ways. Some clients have seen increased demand for new services while other clients have seen business activity restricted. Overall, the company said the recent impact is far smaller than the initial wave of COVID-19.
Management commentary
People Infrastructure CEO Declan Sherman commented on the record results, saying:
People Infrastructure confronted a number of challenges in FY21 due to the impact of COVID-19. The business has shown tremendous resilience to bounce back over the last 12 months. As a result, we are pleased to announce a significant increase in revenue and earnings.
The business demonstrated a steady increase in billed hours in the second half versus the first half and a significant increase in permanent billings in the second half versus the first half. This was consistent across all divisions and as a result the company is starting FY22 in a very strong position.
Despite the near-term volatility and impact of COVID-19, Sherman remains confident in the company's ability to navigate through uncertainty.
Any short term impacts on our clients are significantly mitigated by our regional and product diversity.
Importantly, the outlook for the employment market continues to be positive in the sectors that we service and we look forward to continuing to work with clients to manage their problems around staffing shortages.
What's next for People Infrastructure?
Looking ahead, People Infrastructure flagged that there may be some short term volatility due to NSW and Victorian lockdowns. But this could also be mitigated by its regional and industry diversification.
Management said that the company would continue to be on the lookout for acquisition opportunities in staffing and managed services to drive geographic spread and/or further expand its service offering.
The People Infrastructure share price will go ex-dividend on Friday, 3 September for a 6 cents per share dividend.
