CPL Resources shares fall further as firm warns of Brexit risk

Shares in leading Irish recruiter CPL Resources continued their post-Brexit vote fall, yesterday, as the group warned the impact on its business of Britain’s vote to leave the EU remains uncertain.

CPL’s share price is now down by more than 20% since June 23 — when it sat at €6.14 — and fell 1.61% yesterday to €4.90.

“CPL’s net fees from outside Ireland currently represent 26% of its total net fees and the main exposure to the UK is through its healthcare and life sciences segments,” said Ross Harvey of Davy Stockbrokers.

In a brief trading update, CPL yesterday said its profits and revenues continued to grow in the second half of its financial year and that its full-year profits – for the 12 months to the end of June - should meet market expectations.

Analysts expect a 4% rise in profits, to €15.6m, for the period.

However, the impact of Britain voting to leave the EU remains to be seen as the group enters a new fiscal year, but management yesterday attempted to put a positive slant on the development.

“We are monitoring the effects of the recent Brexit vote in the UK and assessing its implications for our business. Our initial assessment is that it presents both challenges and opportunities for us.”

Goodbody Stockbrokers’ Gerry Hennigan said amid the obvious market concern from the Brexit fall-out, CPL’s higher exposure to the Irish market should offer “a degree of comfort” to investors.

He also interpreted the company’s outlook regarding Brexit as offering “near-term challenges in the UK market and medium-term opportunities in Ireland.”

CPL said its balance sheet and cash flow remain strong.