- Net turnover MSEK 556 (658)
- Operating profit MSEK 19 (-11)
- Profit after tax MSEK 11 (-9)
- Earnings per share SEK 0,16 (-0,13)
- RC Consultants, sold in the beginning of 2005, had a net turnover of MSEK 101 and an operating profit of MSEK 6 for the first quarter 2004
- The capital gain on the sale of RC Consultants is included in the operating profit for the first quarter 2005 with MSEK 57

Operations
The Group net turnover for the period was MSEK 556 (658). The lower turnover is primarily due the sale of the subsidiary, RC Consultants, in the beginning of 2005. RC Consultants had a net turnover of MSEK 101 during the first quarter 2004. The lower turnover is also a result of lower volumes within the activity area Temporary Staffing in Sweden, primarily within the areas conversion projects and Industry and Logistics.

The Nordic temporary staffing market is marked by continued price pressure, which results in lower gross margins. The operating profit, excluding capital gain on the sale of RC Consultants, was MSEK -38 (-11). RC Consultants reported an operating profit of approximately MSEK 6 during the first quarter 2004. Costs for the ongoing restructuring programme together with other nonrecurring costs of approximately MSEK 20, are included in the operating profit for the first quarter 2005. The restructuring costs include phase-out costs for personnel and other external costs such as rent, IT-systems and consulting fees.

ProffCom’s Norwegian operation, sold after the end of the period, is included in the consolidated report for the first quarter 2005 with a net turnover of MSEK 9 and an operating profit of MSEK -4.

Changed principles for accounting of franchise income
Proffice has changed accounting principle for income from franchise, which means that only the fee which Proffice receives from the franchise-holder is reported as net turnover. Proffice has previously reported the total net turnover generated from the franchise-holder as a group net turnover. The profit is not affected by this change of principle. The comparative figures for 2004 have been changed in accordance with the new principle. See further information under accounting principles below.

Restructuring programme
The restructuring programme which started in March 2005 runs according to plan. Restructuring costs together with other nonrecurring costs account for MSEK 20 during the first quarter. Additional restructuring costs are estimated at MSEK 5. Our estimate of a profit increase for 2005 of MSEK 40 through the restructuring programme remains the same. The business structure for Temporary Staffing in Sweden has been simplified to create a clearer division of responsibility and an increased focus on sales. A new candidate system has been implemented in order to improve the recruiting process to find candidates for permanent positions at client companies as well as for assignments with the temporary staffing operation. Within Proffice’s Danish operation the central administration has been reduced and at the same time some larger customer contracts have been renegotiated to improve profitability. The number of positions within the parent company is being substantially reduced with a decentralized responsibility for e.g. IT. In April, ProffCom’s Norwegian operation was sold.

Sweden
The net turnover was MSEK 342 (378), which is a reduction by 10 per cent compared to the same period last year. The operating profit, excluding undistributed parent company cost, was MSEK -17 (-4). The reduced turnover is a result of lower volumes in the activity area Temporary Staffing in Sweden, primarily in the areas conversion projects and Industry and Logistics. The lower earnings are primarily a result of the cost for the ongoing restructuring programme and other nonrecurring costs.

Norway
Net turnover increased to MSEK 124 (215), which is a reduction of 42 per cent compared to the same period last year. Adjusted for RC Consultants, which was sold in the beginning of 2005, the growth was 9 per cent compared to the same period last year. The operating profit, excluding the capital gain for RC Consultants, was MSEK -3 (6). The operating loss is a result of the loss in ProffCom’s Norwegian operations which was sold in April 2005. Proffice’s other operations in Norway, Temporary Staffing and Recruitment and also Career & Development show good developments.

Denmark
The net turnover was MSEK 52 (43), a 21 per cent increase compared to the same period last year. The operating profit was MSEK -11 (-5). The increased turnover is a result of increased volumes in temporary staffing for the health care sector. The operating loss is primarily relating to ProffCom’s Danish operation. The profitability is, however, still not satisfactory for the activity areas Temporary Staffing and necessary measures to achieve positive earnings for this operation include, among other things, a continued reduction of administrative costs and an increased focus on the doctor staffing operation.

Finland
The net turnover was MSEK 38 (22), which corresponds to an increase of 73 per cent compared to the same period last year. The operating profit was MSEK 3 (2). The Tampere operation has showed a strong growth and good profitability during a number of years. The measures implemented at the end of 2004 for the Helsinki operation had the intended result and also this operation reports increased turnover and earnings, compared to the same period last year. The callcenter operation continues to have a positive development.

Net turnover and operating profit per activity area
As per the first quarter 2005, Proffice will report net turnover and operating profit for Temporary Staffing and Recruitment, Outsourcing, Career & Development. The net turnover for Recruitment has earlier been reported together with Career & Development. The operating profit has previously been reported per country only.

Temporary Staffing and Recruitment show a net turnover of MSEK 443 (533), and an operating profit of MSEK -14 (1). The reduction in turnover is due to the sale of RC Consultants at the beginning of 2005, and lower volumes for the Swedish operation, primarily within the areas conversion projects and Industry and Logistics. The health care operation has had a strong development and shows positive earnings.

Outsourcing had a net turnover of MSEK 100 (103) and an operating profit of MSEK -11 (-4). The lower turnover as well as lower earnings is related to ProffCom’s Norwegian and Danish operations.

Career & Development had a net turnover of MSEK 13 (22) and an operating profit of MSEK -3 (2). The lower turnover and lower earnings are due to reduced activities within conversion projects performed by Proffice in Sweden. The lower earnings are also due to the build up of the Swedish organization, made with the aim to take advantage of new business opportunities generated by funds for conversion projects made available by TSL Employment Security Fund (Trygghetsfonden).

The parent company’s undistributed operating cost was MSEK -10 (-10).

Personnel
The average number of full-time employees was 5,617 (6,008).

Turnover
The net turnover decreased by 16 per cent to MSEK 556 (658). As described above, the turnover for 2004 has been reported according to the changed accounting principles related to franchise.

Earnings development

Operating profit amounted to MSEK 19 (-11), which is equivalent to a margin of 3.4 (-1.7) per cent. The operating profit includes a capital gain of MSEK 57 on the sale of RC Consultants.