Investors

Annual Report and Accounts 2008/2009

The principal activity of the company during the year was the provision of quality Information Technology, Communications and e-business Human Capital and software solutions to Blue Chip Clients both Nationally and Internationally.

IT Human Resources plc's core business is the provision of contract staff resourcing, permanent recruitment and retained search recruitment to Blue Chip Clients in some 20+ countries worldwide. As a wholly owned subsidiary ITHR Consulting Ltd provides consulting services focussed on IT project governance, project and programme management and software development and integration, predominantly to the Telecommunications and Mobile Internet Services sectors. As stated in previous Annual Reports ITHR Consulting has been heavily invested in the last couple of years and the result of that considerable investment is now starting to be realised, as I will further detail later.

IT Human Resources plc is a proudly independent organisation, wholly funded, owned and managed by the Directors and Employees of the Company. All growth since our inception in 1999 has been achieved organically and has been driven by our quality ethos in all of our business dealings with all stakeholders; be they with our customers, candidates or suppliers and by our desire to succeed in a spirit of true partnership.

Our aim is to innovate our chosen marketplaces with total professionalism whilst being flexible enough through our independence not only to meet but exceed our Clients' expectations.

Now in our 11th year of trading I am pleased to present IT Human Resources plc's 10th annual Group Report and Accounts for the year ended 31st March 2009 - another record year for us.

This past year has been a landmark year in our industry. First and foremost it has marked our 10th “birthday” of trading in which all current employees helped us celebrate in style. This is no mean feat given that in our short existence we have seen out not only the “recessions” of the post Y2K boom era, 9/11 and Dot.Com bubble burst but also in the last 18 months what many have called the fastest and deepest recession since the 1950’s caused by the Global financial crisis, worldwide banking collapse and the resulting “Credit Crunch”. This period has seen unprecedented contraction in all recruitment sectors and in particular our core IT market where many competitors at best have reported falling revenues and profits and at worst significant losses and even bankruptcy.

With this backdrop in mind I am pleased to report yet another record breaking year for IT Human Resources plc. Group revenues increased some 85% for the year to £24.2m from £13.2m, Gross Operating Income increased in excess of 150% on FY2007/08 to just over £6.39m and as mooted earlier Profit Before Tax combined across all our businesses rose an impressive 245%. This has resulted at year end with cash in hand significantly increased, a positive balance sheet and retained reserves that I know from my 23 years in the industry would be the envy of our similar sized direct competitors.

In this accounting period we have increased our business levels in all of our various activities, be they contract resourcing, recruitment or consulting/software development, which is quite an exceptional performance given the current economic climate.

Our recruitment and resourcing arm did fall somewhat short of our ambitious growth plans and we are currently in the process of providing further impetus to that business in order to re-establish past growth patterns with the appointment of some key senior personnel and a greater focus from the Board on our core business which will most definitely include a hunt for a strategic acquisition, given our financial strength.

Our consulting arm, on the other hand, enjoyed a year of phenomenal growth. This, I believe, is for two reasons: Firstly to the focus of the Board and the belief that was shown in the business (mentioned in earlier Annual Reports) and the considerable investments that were made in the Company. Secondly, the exceptional quality of the senior management team of the business, both inherent and assembled, that are “best of breed” and without parallel in our chosen specialist markets. As a result, I believe, we are now one of the world’s leading consulting and software development specialists in our field.

Looking forward to FY2009/10 our continuing current operations lead me to predict a modest growth this year with target revenues of between £28-32m being at the upper end of our expectations. Like every Company we are feeling the effects of the current and continuing recession with Client budget constraints proving to be a major challenge, placing revenue and margins under increased pressure.

However, as always, and with an unwavering belief in our core values we remain optimistic for the coming year which backed by our fastidious financial prudence in the “good times” and a very strong cash position and balance sheet we are looking forward to an adventurous FY2009/10:

Firstly in April 2009 ITHR Consulting opened its London based 80 seat software development centre; designed to bring their best of breed technical and commercial specialists together for the first time in our own dedicated facility. This will not only allow us to better fulfil current contractual obligations but will also allow us to further expand into new market segments.

Secondly and since the close of FY2008/09 we have further diversified and set up a new subsidiary - ITHR Online Ltd - to take to market in the UK MSEmploy, (an already proven brand in other 6 other countries, including Germany, France and the USA) a highly innovative and totally new online recruitment initiative which is endorsed and supported by perhaps the world’s number one IT software organisation. Thirdly we have targeted this year to use our considerable financial stability and reserves to focus on finding a strategic acquisition to complement our existing resourcing and recruitment business.

Lastly and after 10 happy years based out of our prestigious HQ offices overlooking London’s Leicester Square (with first class viewing seats to pretty much every film premiere held in London) we will be re-locating to much larger premises in order to focus our future growth and the huge opportunity that lies ahead as the UK and the world head tentatively out of the recession and back into growth - where, I firmly believe IT Human Resources plc will be ideally placed to take great advantage.

Sean Gallagher
Managing Director