Having previously warned on FY results back in September (see ReThink rethinks FY outlook) and then just week dispensed with the services of its founding CEO (see ReThink rethinks CEO), AIM-listed IT recruitment-cum-consultancy firm ReThink Group (RTG) has rethought its FY profit forecast – which now appears to be a loss forecast. Interim CEO Steve Wright notes that although net fee income (gross profit) increased by 11% last year, ‘increased investment in the business at the outset of 2012’ pushed the Group into loss.
RTG turned over £79m in 2011 with NFI at £18m, making a £1.8m pre-tax profit (see ReThink rethinks Aiimi brand). Almost 85% of RTG’s gross profit in 2011 came from its core recruitment activities (including RPO – recruitment process outsourcing). It was a decline in permanent recruitment in H2 2012 that precipitated the warning. Wright made no comment about RTG's side-line consulting (Aiimi) business. We will likely have to wait till April to hear the full story.