InterQuest Group PLC - Termination of Contract within CCL
Pubished 12th August 2011
Termination of Contract within CCL
InterQuest Group plc (AIM: ITQ.L) announces that due to apparent impropriety and alleged fraud within a major client of the recently acquired Contract Connections Limited (“CCL”), the client has terminated its contract with CCL (“the Termination”).
The client has withheld, pending an ongoing investigation, £0.6 million owed to CCL which has arisen during the normal course of business. In the opinion of the Board and its legal advisors, the Termination represents a breach of the contract between CCL and the client. The Board therefore believes that there will be a path to seeking restitution and potentially damages in due course.
However, in light of these circumstances, the Board believes it would be appropriate to impair both the receivable (£0.6 million) and the related goodwill arising on the business combination (£2.0 million), totalling approximately £2.6 million.
As such, while the Group as a whole continues to trade well and the Board continues to explore expansion opportunities, the Group’s results for the year ending 31 December 2011 will be adversely impacted.
The Termination is not considered material in relation to the prospects of the Group in future financial periods as it will reduce the number of contractors currently on assignment by approximately 40 out of a total in excess of 1200 across the Group.
Outside of CCL, the Group continues to trade in-line with the Board’s expectations, delivering revenue growth and increasing levels of profitability.
The Board will update investors on this issue as and when appropriate and, as previously notified, will announce results for the half year ended 30 June 2011 on 13 September 2011.
For further information please contact:
|InterQuest Group plc||Threadneedle Communications||finnCap|
|020 7025 0100||020 7653 9850||020 7600 1658|
|Gary Ashworth, Executive Chairman||Caroline Evans-Jones||Marc Young|
|Michael Joyce, Finance Director||Fiona Conroy||Charlotte Stranner|
The InterQuest Group is a specialist IT recruitment Group providing contract and permanent recruitment services within niche disciplines in the UK and Europe. The Group comprises seventeen separately branded specialist divisions covering a broad range of skill sets and industries including Public Sector, SAP, Oracle, CRM Testing, Banking, Insurance, Retailing, Pharmaceuticals, Media, Analytics, Infrastructure and Communications.