Highams Systems Services

Highams, a supplier of IT services to the insurance and finance sectors, has been in the wars lately due to challenging conditions in the IT sector in particular and recruitment market in general. Nevertheless, in the year to March pre-tax losses were hauled back from £2m to £298,000, though sales were lower at £16.8m (£20.7m). Encouragingly, there were signs of improvement in the second half following some restructuring. Pre-tax profits at Highams Recruitment and Highams Business Solutions (HBS) came in at £72,000 on sales of £7m. Interim figures showed pre-tax losses of £370,000, including trading losses and closure costs associated with its consultancy business. Market conditions for the supply of IT staff (both permanent and contract) remained tough. The board says the aggregate number of contractors working with clients continued to fall. Chairman Nigel Graham Maw admits: 'Our markets remain patchy.' But there have been signs of improvement since the start of the calendar year. Client vacancies are increasing, and there has been a rise in sales enquiries at HBS. Although the effects of a recovery will not flow into its first-half figures, Maw argues that 'business will gradually improve over the next 12-18 months'.

Sector: General Industrials

Companies: Highams Systems Services

Market cap: £1.4m

PE Forecast: 4.8

Share price: 7.25p

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