Parity upbeat on improvement in net fee income

Data and technology-focussed recruitment and professional services provider Parity Group said in an update on Monday that its first-half net fee income was expected to be up to 9% higher against the second half of 2021.

The AIM-traded firm said that would make it the first time in more than three years that it had increased net fee income in sequential reporting periods.

It also reported an improved operating performance in the six months ended 30 June, following its actions to refocus the business and streamline its cost base during the prior year.

Adjusted EBITDA for the first half was expected to be around £0.3m, following an EBITDA loss in the latter six months of last year.

“Having successfully rebuilt the core recruitment business platform within Parity, we are beginning to see this capability make a positive impact on the performance of the business,” said executive chairman Mark Braund.

“During the period, we materially improved customer relationships and the size and quality of Parity's virtual bench of skilled technology contractors, re-establishing it as one of the best of its kind addressing the public sector market.

“With improvements in mobility and skills transfer, Parity's access to these skilled resources will be increasingly valuable as we focus more of our attention on the commercial, private, sector.”

Braund said with that foundation in place, the firm was “evolving” its proposition to include relevant new areas of business to support future growth.

“Permanent recruitment is one such opportunity, driven by demand from current clients and the wider market.

“I am delighted that the investment we have made during the first half of 2022 to develop our permanent recruitment team is already beginning to pay back with a positive contribution to our first half performance.

“We are seeking to develop this revenue stream further in the second half.”

The last nine months had seen “significant change” in the make-up, focus and strength of the team, Mark Braund said.

“The enthusiasm, commitment and tenacity of all my colleagues is at the core of Parity's turnaround.

“We still have much more to do but with each step we are making, our foundations are getting stronger.

“The balance of the year will be focused on maintaining our positive momentum and positioning the business for further growth in 2023.”

At 1138 BST, shares in Parity Group were up 0.97% at 8.33p.

Reporting by Josh White at Sharecast.com.