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Parity profits plunge after losing consultancy services contract with Ministry of Defence

"Trading remains in line with expectations and the board's confidence in the refreshed strategy is reflected in its continuing investment," said John Conoley, non-executive chairman
military
Profits were hit by costs related to the delay and subsequent loss of the MoD contract

Parity Group PLC's (LON:PTY) profits plunged in 2018 after the Ministry of Defence (MoD) decided against renewing a consultancy services contract with the company.

Adjusted pre-tax profit dropped 48.7% to £850,000 last year due to costs related to the delay and subsequent loss of the MoD contract.

READ: Parity shares under the cosh after losing staffing contract with Scottish government

Revenue increased 2.7% to £86.1mln but was led higher by the lower margin recruitment business.

The adjusted pre-tax margin fell to 1.0% from 2.0% last year.

Last year, the company took action to address its performance by exiting its loss-making virtual reality business Inition and focusing on its higher-margin data consultancy services division.  

"Reorganising and reshaping of our proposition will build on our strengths as trusted partners with deep and lasting relationships that empower clients to make bold data-led business decisions,” said John Conoley, non-executive chairman.

"Trading remains in line with expectations and the board's confidence in the refreshed strategy is reflected in its continuing investment.”

Shares dropped 10% to 7p in morning trading.

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