5 January 2011 – acquisition and change of adviser

Following hot on the heels of our comment that Staffline needs to make acquisitions, the trade and assets of Kelburn Industrial, a Newcastle-based provider of recruitment solutions, have been acquired. However, no financial details have been released at this stage so it is impossible to assess the impact this will have. A change of Nominated Adviser and Broker to Liberum Capital has also been announced. We continue to believe that acquisitions are key and there is serious potential for growth but on balance retain our HOLD recommendation for the time being.