New Business and VAT Deferral Update

5 October 2020

STAFFLINE GROUP PLC

("Staffline" or the "Group")

New Business and VAT Deferral Update

Staffline, the Recruitment and Training group, provides the following update on new business and VAT deferral.

PeoplePlus update

PeoplePlus, the Group's adult skills and training division, is pleased to announce it has been selected as a provider for the Department for Work and Pensions' ("DWP") Commercial Agreement for the Provision of Employment and Health Related Services ("CAEHRS") framework.

CAEHRS replaces the DWP's existing Umbrella Agreement which expires in 2021. It will become the default framework for contracting employability and health related programmes. CAEHRS will run for five years (2020-2025) and the framework will cover a potential aggregate contract value of £7.5 billion.

This UK-wide commercial agreement is organised into a national Lot and seven regional Lots split across two tiers. Tier 1 covers the commissioning of services with a value of over £11 million in England and £6 million in Scotland and Wales. Tier 2 covers the commissioning of services with a value of between £2 million and £11 million in England and £2 million to £6 million in Scotland and Wales.  

PeoplePlus has been successful in securing a place on the national Lot and has been selected as a Tier 1 provider in all six regions across England and Scotland, and as a Tier 2 provider in Wales. 

Recruitment GB update

Staffline is also pleased to announce a three-year contract extension of an existing agreement to provide contingent labour to Tesco, a significant customer of the Group in terms of scale.  This agreement continues to build on an 11-year working relationship in which Staffline has provided innovative, value added solutions to Tesco's Distribution network.

VAT deferral

The Group notes the Chancellor's recent statement giving businesses who have deferred VAT due from 20 March 2020 to 30 June 2020, the option to pay in smaller payments over a longer period.

As a result, instead of paying the full VAT amount due by the end of March 2021, Staffline can make smaller payments up to the end of March 2022, interest free. This payment period will now ensure that the Group has additional time in which to consider and implement mitigating actions with regards to liquidity as set out in its 2020 interim results.

Ian Lawson, Executive Chairman of Staffline, commented:

"We are delighted to be extending our working partnership with Tesco, a long-term and valued customer, in addition to our PeoplePlus' services being represented so widely across the CAEHRS framework.

"We also welcome the Chancellor's recent amendments to existing VAT deferral measures, which further support the Group's wider actions to further alleviate liquidity pressures in the medium term."

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About Staffline - Recruitment, Training and Support

Enabling the Future of Work™

Staffline is the UK's market leading Recruitment and Training group. It has three divisions:

Recruitment GB

Staffline is the UK's leading provider of flexible blue-collar workers, supplying approximately 40,000 staff per day on average to around 450 client sites, across a wide range of industries including agriculture, supermarkets, drinks, driving, food processing, logistics and manufacturing.

Recruitment Ireland 

The recruitment Ireland business is a leading end to end solutions provider operating across 20 industries, 10 branch locations, 15 onsite customer locations and offering RPO, MSP, temporary and permanent solutions across the island of Ireland.

PeoplePlus Division

Staffline is the leading adult skills and training provider in the UK, delivering apprenticeships, adult education, prison education and skills-based employability programmes across the country.