Manufacturing slump knocks Kinetic
A SHARP downturn in manufacturing recruitment has forced a Manchester employment agency to cut staffing levels by 25%.
In recently-filed accounts Kinetic Recruitment Services, which specialises in providing staff to the manufacturing, engineering and technical markets, said the deterioration of the economy earlier this year had forced its hand.
In their report the directors said: “Trading for the first three quarters of the year was in line with expectations with quarter four resulting in a significant downturn in the core manufacturing business, in line with the current economic climate.
“As a result a significant cost reduction programme has been implemented resulting in a 25% reduction in staffing and related overheads.”
Further details were not given regarding the cuts but the loss of a quarter of Kinetic’s staff would lead to around 20 redundancies.
The directors said gross margins had been protected through the long-term diversification into the rail, infrastructure and nursing recruitment markets.
The accounts also reveal that managers paid £2.2m when they acquired the Kinetic Technical subsidiary last year. The business, which specialises in staff for the oil and gas industries, was bought by a team led by managing director Neil McCarthy in November 2008.
The proceeds of the deal helped Kinetic to record a pre-tax profit for the year to March 31 of £1.9m compared with £336,257 last time on sales of £19.2m, down 14%. It recorded an operating loss of £325,015 compared with a profit of £108,896 last time.
