Staffline Recruitment has posted a 35 per cent rise in full-year pre-tax profit boosted by its onsite division and announced a £12 million deal with a major food supplier.
The business, which has branches in Wolverhampton and Birmingham, added that it is confident of further progress in 2007 as its pipeline of onsite prospects is stronger than ever.
Pre-tax profit for the year to December 31 rose to £3.4 million from £2.5 million a year earlier, as revenues increased 37 per cent to £84.1 million.
The Nottingham company said its onsite division now represented 68 per cent of group turnover and the number of operations had risen from 53 at the end of 2005 to 71 by the end of 2006.
Staffline also said trading in the first eight weeks of 2007 was up on-year and in line with its expectations.
Chief executive Andy Hogarth also said the business had signed a £12 million contract with a UK manufacturer of poultry-based food products. The deal will be to supply staff across five sites, primarily in the east of England.
"This is a particularly prominent deal for us," said My Hogarth, who also owns Hogarths hotel in Solihull.
Mr Hogarth added that business had not been effected by the Government's decision to limit immigration from Romania and Bulgaria - more than 50 per cent of Staffline workers come from Eastern European countries.
He said: "At the moment there are still enough people coming over from Slovakia and Poland. We are having to work a bit harder to find the skilled workers - but I do not believe that the ban on workers from Romania and Bulgaria will go on forever."
Staffline also announced its first acquisition since flotation in 2004 with the buy of Onsite Partnership, a Market Harborough-based recruitment company, for an initial cash payment of £2 million.
The company added it expects its acquisition of Onsite Partnership to make a positive contribution to Staffline in the current financial year.
The initial payment for the purchase will be followed by additional cash payments over three years, depending on the levels of new business.
Onsite Partnership, which operates across the Midlands and Bristol, has annual revenues in excess of £10 million and is expected to be profitable this year, Staffline said.
Mr Hogarth said the purchase was a good fit for Staffline and would allow the business - which has primarily specialised in food manufacturing - to extend its reach in the distribution and logistics market.
"We will be focusing on developing the business in both these sectors," Mr Hogarth added. "The supermarkets are continuing to exert a great pressure on costs, which provides us opportunities with suppliers."
Mr Hogarth said that Staffline would continue to look at expanding the business into other sectors - such as telesales - by acquisition.
The company set a final dividend of 1.7 pence, increasing its total dividend for the year by 42 per cent to 2.7p. Shares were 4p up at 1391[2044]2p.
