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TOTAL STAFFING SOLUTIONS LIMITED
ChairmanÕs Letter (continued)
ÒStrong management team, a focus on candidate and client service and a clear strategic direction.Ó
Humanis under the agreement has the right to appoint three directors to the board, according to ASX guidelines.
The Merger is unanimously recommended by both the Boards of TSS and Humanis and each Director intends to vote their respective shareholdings in favour of the Merger.
The merged company will be a leading mid tier Australasian labour hire provider and the major advantages of the merger include the ability to:
¥ Create and enhance TSSÕs blue collar labour hire divisions through the integration of TSSÕs Australian, and WestaffÕs Australian and New Zealand operations.
¥ Increase the sales lead generation capacity for UltimateSkills by means of collegial working relationships with Westaff; and
¥ Enhance the ability to obtain operational scale and cost efficiencies through the delivery of homogenous services to customers and supplier procurement systems.
This is a significant step forward for the company and we are very proud of the labour hire business we have built over the past two years. To now merge with such an iconic brand as Westaff which is known for quality customer service makes us confident that the greater economies of scale will greatly benefit our customers and shareholders.
With a strong management team, a focus on candidate and client service and a clear strategic direction encompassing both domestic and international recruitment, the outlook for Total Staffing Solutions is very positive. We look forward to working with you as we continue to grow and expand your company.
Bryan Gardiner Chairman
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TOTAL STAFFING SOLUTIONS LIMITED Ð Annual Report 2009
TOTAL STAFFING SOLUTIONS LIMITED Highlights
¥ Organic growth achieved in difficult ¥ market conditions.
Signing of agreement on 6 May 2009 for acquisition of Ultimate Skills Global, ratified at general meetingofshareholderssubsequent to year end on 15 July 2009.
Announcement of merger with Humanis Group Limited to create a leading mid tier Australasian labour hire provider.
¥ Rationalisation of cost structure to ensure future growth as economy comes out of downturn.
¥ Increase to debtor finance facility to fund growth.
¥
FINANCIAL
Total Staffing Solutions today reported a consolidated loss before tax of ($7,453,638) for the year ended 30 June 2009 from continuing operations and a net loss after tax of ($11,647,203) including a loss from discontinued operations of ($5,740,306).
This consolidated loss includes a number of one-off items expenses including:
¥ $239,916 in one off legal costs.
¥ $2,433,233 in impairment charges recognised in the income statement relating to write down of goodwill and intellectual property held in OSS balance sheet.
¥ $458,286 in share based payment expenses. ¥ Provision for doubtful debts against trade receivables
totaling $220,481 recognised during the year.
¥ Provision for doubtful debt against contracts in progress of $388,188 in OSS paid for but where the services where not delivered or made good. As at 30 June 2009 there is a pending legal claim for the amount to be recovered.
¥ Write down of contracts in progress by $245,180 in OSS due to severe downturn in the international recruitment market between November 2008 to April 2009.
¥ Bad debt expense totaling $308,088.
¥ Redundancy expenses totaling $133,192.
¥ Loss on sale of $5,699,689 (after income tax) of the 51% interest in Sstar HR International Pty Ltd, trading as MPi, reported in this financial report as a discontinued operation.
The net asset deficiency position of ($2,076,165) includes the following:
¥ Strong current trade and other receivables of $5,996,635.
¥ Write down of goodwill of $8,807,616 relating to loss on disposal of MPi and impairment of goodwill on acquisition of WIP from CFM Global and Eclipse Staffing.
¥ Borrowings of only $4,435,894 which includes $3,462,880 as the drawdown on the debtor finance facility with Bibby.
¥ $6,913,303 in trade and other payables.
¥ Post reporting date the company has successfully negotiated an increase to its debtor finance facility from $4.0 million to $5.8 million to enable the business to continue to grow at the projected rates.
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