Ferret's Stock to Watch: SKILLED GROUP LIMITED09:06, Monday, 20...

Ferret's Stock to Watch: SKILLED GROUP LIMITED
09:06, Monday, 20 February 2006

COMPANY SAYS ITS CORE HIRING BUSINESSES REMAIN STRONG

Sydney - Monday - February 20: (RWE Aust Business News)
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OVERVIEW
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Skilled Group Ltd (SKE) is now run by Greg Hargrave, the son of
the founder, and looks to be in safe hands.
The shares were languishing around $3 on November 24 and have
climbed more than a dollar since, and accelerated after the company
spelled out a guidance upgrade on December 20 with Corporatefile.
Mr Hargrave, managing director and CEO, is imbued by getting the
right culture into a business and has a passion that the right people
should fit the right job, rather than pursue financial rewards which in
any case appear to come naturally when based on this strategy.
Skilled Group aims to be Australia's largest, diversified
services company.
It covers trades, engineering professionals, production and
logistics, personnel, hospitality and events, child care, rail,
education, nursing and call centres.
The company is also involved in fire truck manufacturing,
workshop fabrication and machining, and a grab bag of port activities
including pollution control, wharf repair, installation and
construction in power and communications etc.
Mr Hargrave told the Australian Financial Review that his father
Frank built the labour hire firm - it is now called a staff services
company - from the early 1960s until it diversified in the 1990s into
project management and other capital-intensive vehicles.
Since taking over the reins Mr Hargrave has sought to refocus
the Skilled brand on its core business of supplying experienced staff.
He told Corporatefile that demand across the company's businesses
in the first half has been strong and it's expecting continued strength
for the remainder of the financial year.
Skilled Group reported EBITDA, excluding divestments, of $34.9
million in the 2005 financial year.
Mr Hargrave said the company was still on track to achieve EBITDA
growth guidance of 15 to 20 per cent in the current year.
"There's been particular strength in the mining and resources
sector, transport, logistics and infrastructure," he said.
"Margin growth has been a continuing focus of our management team
and we've seen EBITDA margin growth in the first half.
"In FY05, excluding profit on divestments, our EBITDA to
revenue was 4.2 per cent and we expect an improvement in FY06," Mr
Hargrave declared.

SHARE PRICE MOVEMENTS
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Shares of the Skilled Group edged 2c higher to $4.21 on Friday,
not far from its rolling high for the year of $4.26. Low was $2.20.
Dividend is 16c to yield of 3.8 per cent. Earnings per share is 24.73c
and p/e ratio is an 17.02. The company has 103.5 million shares on issue
with a market cap of $434 million.
In the last financial year sales revenue increased 13 per cent to
$833.6 million, while net profit (including profit from divestments)
was up 48 per cent at $24.3 million.
Excluding profit from divestments, profit was $13.3 million.
Sales revenue from Managed Labour Services rose 27.4 per cent to
$779.3 million, and EBITDA was 25.3 per cent higher at $33.1 million.
Net debt was reduced to $25 million from $55 million at June 2004

BACKGROUND
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Skilled Group was listed on the Australian Stock Exchange on
July 27, 1994.
Skilled has 40 years of experience in workforce solutions,
developing a team of dedicated, highly qualified people producing results
for clients across Australia and New Zealand.
By delivering specialist workforce solutions, Skilled is
committed to helping clients become more productive through better use
of one of its greatest assets - people.
Skilled is a national workforce services company built on a
passion for providing superior service with the very best people and a
commitment to safety and the community.
The company claims to be the industry leader in specialist
workforce solutions through the delivery of flexible labour and
project-based workforce solutions, including shut downs,
installations and relocations, and total workforce management,
It specialises in primary manufacturing, food and
pharmaceuticals, automotive and machinery.
In mining and energy it includes transport and logistics,
primary services government and defence.
Skilled workforce management covers training and apprenticeship,
OH&S and IR expertise provide clients with flexibility, risk management,
reduced workforce related costs and ultimately productivity improvements.