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Workforce management company People Infrastructure (ASX: PPE) continues its acquisition drive after entering a binding agreement to buy Melbourne-based SwingShift Nurses for $3.1 million.
It is a move that follows the completion of an acquisition of technology staffing businesses eCareer Employment Services and Illuminate Search and Consulting for $5.15 million in January.
Just like that purchase the nursing deal will be funded by People Infrastructure's existing cash reserves, which were bolstered by an 83.6 per cent lift in net profit after tax in the December half. As at 31 December, the group's net cash position stood at $7.2 million.
Swingshift Nurses is a preferred supplier to most public sector hospitals in Victoria with a special focus on the mental health market.
"The acquisition of SwingShift Nurses is highly complementary to our existing Victorian nursing staffing business," says People Infrastructure chief executive officer Declan Sherman.
"The Business is well established in the Victorian market and will facilitate further growth into the mental health market.
"People Infrastructure is especially attracted to the business due to its strong position in the Victorian specialist nursing on-hire contracting market, and its long term relationships with its customers."
The acquisition is expected to generate $1 million in EBITDA in the 12 months following completion, which is due in the coming weeks.
PPE's profit after tax reached $11.6 million in the December half, while normalised EBITDA was almost 50 per cent higher at $21 million.
The company did however receive $13.2 million in JobKeeper wage subsidies during 2020.
The group forecasts a normalised EBITDA of $35-37 million in the current financial year.
"Looking forward into the second half of FY21, whilst we are aware that the economic and operational uncertainty relating to COVID-19 may still have implications for our clients, we note the general stability that is returning to the sectors which we serve and we continue to focus on driving growth in niches where we can demonstrate a clear point of difference in our product and services offering," Sherman said in February.
"We continue to look at both the opportunity to grow organically into new sectors as well as use our strong balance sheet for acquisition opportunities that would expedite that growth."
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