Monday, 10 August 2009

Offshore outsourcing helps Harvey Nash

(By Anthony Miller – Monday 10th August 2009 8:00am). Recruitment, and now burgeoning offshore IT services player, Harvey Nash is set to report flat revenues (i.e. some £200m) for the first half to 31st July, according to today’s trading update (see here). However, gross profit will be 5% down, which by our calculations means gross margin will dip under 16%. The company gave no statement on profit further down the P&L, but operating margins in the same period last year were 2.2%. Harvey Nash’s Vietnam-based offshore IT services business has grown to represent 20% of group OP (see Offshoring now 20% of Harvey Nash’s profit) and it sounds like this may rise further given the decline in the company’s traditional recruitment services. We will learn more at the end of September.

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