As filed with the Securities and Exchange Commission on August 3, 1999
--------------------------------------------------------------------------------
                       SECURITIES AND EXCHANGE COMMISSION

                              Washington D.C. 20549

                                    FORM 20-F


                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                    For the fiscal year ended March 31, 1999
                         Commission file number 0-28662

                             PROFESSIONAL STAFF PLC
             (Exact name of Registrant as specified in its charter)

                                England and Wales
                 (Jurisdiction of incorporation or organization)

                                 Buckland House
                                 Waterside Drive
                              Langley Business Park
                                 Slough SL3 6EZ
                                     England
                       -----------------------------------
                    (Address of principal executive offices)

           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

                Title of                        Name of each exchange
               each class                        on which registered
               ----------                        -------------------

                  None                                  None

           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                   Ordinary Shares, nominal value 2p per share
                                (Title of Class)

              SECURITIES FOR WHICH THERE IS A REPORTING OBLIGATION
                      PURSUANT TO SECTION 15(d) OF THE ACT:

                                      None
                                (Title of Class)

Indicate the number of issued shares of each of the issuer's classes of capital
or common stock as of the close of the period covered by the annual report:

              8,496,353 Ordinary Shares, nominal value 2p per share
                             -----------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:

         Yes |X|  No |_|

Indicate by check mark which financial statement item the Registrant has elected
to follow:

         Item 17 |_| Item 18 |X|
--------------------------------------------------------------------------------

                      Page 1 of 48-Exhibit Index on Page 30

<PAGE>




                                TABLE OF CONTENTS


PART I.........................................................................4
      Item 1.  DESCRIPTION OF BUSINESS.........................................4
      Item 2.  DESCRIPTION OF PROPERTY........................................12
      Item 3.  LEGAL PROCEEDINGS..............................................12
      Item 4.  CONTROL OF REGISTRANT..........................................12
      Item 5.  NATURE OF TRADING MARKET.......................................13
      Item 6.  EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY
               HOLDERS........................................................13
      Item 7.  TAXATION.......................................................14
      Item 8.  SELECTED FINANCIAL DATA........................................18
      Item 9.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
               FINANCIAL CONDITION AND RESULTS OF OPERATIONS..................19
      Item 9A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK......25
      Item 10. DIRECTORS AND OFFICERS OF REGISTRANT...........................25
      Item 11. COMPENSATION OF DIRECTORS AND OFFICERS.........................27
      Item 12. OPTIONS TO PURCHASE SECURITIES FROM REGISTRANT OR SUBSIDIARIES.27
      Item 13. INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS.................29

PART II.......................................................................29
      Item 14. DESCRIPTION OF SECURITIES TO BE REGISTERED.....................29

PART III......................................................................29
      Item 15. DEFAULTS UPON SENIOR SECURITIES................................29
      Item 16. CHANGES IN SECURITIES AND CHANGES IN SECURITY FOR
               REGISTERED SECURITIES..........................................29

PART IV.......................................................................29
      Item 17. FINANCIAL STATEMENTS...........................................29
      Item 18. FINANCIAL STATEMENTS...........................................29
      Item 19. FINANCIAL STATEMENTS AND EXHIBITS..............................30


                                        2

<PAGE>



                                  Introduction


         In this Annual Report on Form 20-F (the "Annual Report"), references to
"U.S. dollars", "dollars", "U.S.$" or "$" are to currency of the United States
of America (the "U.S." or the "United States"), references to "pounds sterling",
"sterling", "(pound)", "pence" or "p" are to currency of the United Kingdom of
Great Britain and Northern Ireland (the "U.K." or "United Kingdom"). The Company
publishes its consolidated financial statements in pounds sterling. Solely for
the convenience of the reader, this Annual Report contains translations of
certain pound sterling amounts into U.S. dollars at specified rates. These
translations should not be construed as representations that the pound sterling
amounts actually represent such U.S. dollar amounts or have been, could have
been, or could be, converted into U.S. dollars at the rate indicated or at any
other rate. Unless otherwise indicated, the translations of pounds sterling into
U.S. dollars have been made at $1.6140 per (pound)1.00, the noon buying rate in
the City of New York for cable transfers in pounds sterling as certified for
customs purposes by the Federal Reserve Bank of New York (the "Noon Buying
Rate") on March 31, 1999, the date of the most recent balance sheet of the
Company included herein.

         Professional Staff plc prepares its financial statements in accordance
with accounting principles generally accepted in the United States ("U.S.
GAAP"). The financial statements and other financial data included elsewhere in
this Annual Report have been prepared in accordance with U.S. GAAP, unless
otherwise stated. The Company prepares its financial statements on the basis of
a financial year beginning on April 1 and ending on March 31. References to a
fiscal year in this Annual Report shall, unless otherwise indicated, be
references to the financial year of the Company ending on March 31 of such year.
In this Annual Report, financial results and operating statistics are, unless
otherwise indicated, stated on the basis of such financial years.

                   ------------------------------------------


         Unless otherwise specified or the context otherwise requires, in this
Annual Report, the "Company" or "Professional Staff" refers to Professional
Staff plc together with its subsidiaries, "Lab Staff" refers to Lab Staff
Limited, "Executives on Assignment" refers to Executives on Assignment Limited,
"Salisbury" refers to Salisbury Consulting Group Limited, "S-Com" refers to
S-Com Computer Systems Engineers Limited, "SDS" refers to SDS Computer Group
Limited, "The Woolf Group" refers to The Woolf Group, Inc., "Euromedica" refers
to Euromedica plc and Euromedica International Limited combined, "EPL" refers to
EPL Overseas Limited "S-Com EPL" refers to S-Com and EPL combined, and
"Praxis" refers to Praxis Executive Task Force Limited.

         The Company was incorporated on February 20, 1990 under the laws of
England and Wales. Its principal executive offices are located at Buckland
House, Waterside Drive, Langley Business Park, Slough SL3 6EZ, United Kingdom
(telephone 44-1-753-580-540).


                                        3

<PAGE>



                                     PART I

Item 1.  DESCRIPTION OF BUSINESS

         Professional Staff is a specialty staffing services company based
mainly in the United Kingdom and the United States, providing temporary and
permanent placement services to the technology, science and management sectors.
Since the Company's initial public offering in August 1996, the Company has
completed seven significant acquisitions which have expanded the range of
specialty services, geographic markets and industry sectors that the Company
serves. Within the technology sector, the Company offers highly specialized
professionals in telecommunications, datacommunications, IT and specialty
engineering. Major customers of the Company's technology staffing services
include BT, Orange, Ericsson, Qualcomm, Lucent and Nokia. Within the science
sector, in which the Company continues to dominate the UK staffing market, the
Company offers scientists and laboratory technicians with expertise in more than
500 different skills in disciplines including chemistry, microbiology and
biotechnology. In the United States, the Company offers clinical research
professionals and associated services to major pharmaceutical and clinical
research organisations. The Company's science division also includes Europe's
largest executive search consultancy dedicated to the pharmaceutical, bioscience
and healthcare industries. The Company's major clients within the science sector
include Glaxo Wellcome, Astra Zeneca, SmithKline Beecham, Merck, Sharp & Dohme
and Evans Medical. Within the management sector, in which the Company leads the
UK market, the Company offers interim managers and executives across a broad
spectrum of industry and commerce.

         The Company's head offices are located in Langley near London. In
addition, the Company has offices throughout the United Kingdom, in San
Francisco and Chapel Hill, North Carolina in the United States, and in Brussels
and Munich in continental Europe.

Industry Overview

         The staffing industry in the United Kingdom, including both temporary
and permanent staffing, is the largest in Europe and has experienced significant
growth. From 1995 to 1998, the total market grew from an estimated $18.5 billion
to $25.6 billion, or approximately 38%. The penetration rate, measured as the
number of temporary workers expressed as a percentage of the total work force,
is estimated by the Federation of Recruitment and Employment Services ("FRES")
to be approximately 3.3%. The UK market is highly fragmented with approximately
2,500 companies active in a deregulated environment. The overall trend in
continental Europe has been toward progressive liberalization and recent
deregulation has created new development opportunities for the staffing
industry. See "--Regulation."

         Specialty staffing services have become a significant component of
human resource management. Staffing companies create value by providing the
flexible work force that allows client companies to focus on core competencies.
Strategic recruitment outsourcing allows companies effectively to manage human
resources in response to operational fluctuations and economic and product
cycles. Increasingly, corporations are turning to temporary workers as a means
to achieve greater operating efficiency, to transfer fixed labor costs to
variable costs, to add flexibility to operations, to reduce risks associated
with hiring permanent employees and to import skills missing from their
organizations.

         Permanent recruitment services with dedicated technical expertise are
also becoming increasingly important as demand has reduced the pool of available
specialty professionals and made it more difficult to locate qualified
candidates. For these reasons the Company believes that clients have become
increasingly reliant upon specialty permanent placement and search services.

         Technology Sector. Telecommunications services is one of the fastest
growing sectors of the staffing industry. The expansion of the global market for
communication services and the continued development of new technology has been
accompanied by substantial expenditure on developing new equipment and services
required to upgrade existing and develop new networks. Particularly in less
developed countries with limited existing communications infrastructure, the
number of subscribers has increased substantially as the installation of
wireless networks proves more cost-efficient and expeditious than the rollout of
landline networks. Expenditures on equipment and service are driven by changing
technology as existing land line and wireless networks that represent first
generation technology are converted to accommodate second generation digital
technologies. The Company expects

                                        4

<PAGE>



that in the next several years newer third generation technologies will be
developed that will deliver voice, data and video signals. These new
technologies should continue to stimulate expenditures for services and
equipment.

         Information Technology services, including data communications and
specialty software engineering, is also a fast growing sector as a result of
increased demand for personnel in a range of computer-related disciplines,
including technical project support, software development, documentation systems
and database management.

         Industries involved in high and emerging technologies continue to
experience strong growth and an increasing reliance on both core and contingent
skills at the right levels and at the right time. Management believes that rapid
technological change, intense competition and increasing specialization have all
resulted in an increasing use of and reliance by employers upon providers of
specialty staffing services.

         Science Sector. Science services has been a growing sector in the
United Kingdom following the Company's pioneering of the use of temporary
professionals in the scientific laboratory. The use of temporary scientific
professionals has grown in recent years in the pharmaceutical, biotechnology,
environmental, food, chemical and petrochemical industries. This growth is the
result of increased acceptance of the use of temporary workers as well as
shortages of certain scientific skills. In the United States, demand for
clinical trials staffing services is being driven by the unprecedented growth in
the clinical trial segment of the drug development industry. Technological
advances and market demand for novel drug therapies have led pharmaceutical and
biotechnology companies ("sponsors") to produce over 400 new drug compounds a
year. Concurrently, stringent approval requirements demand a greater number of
trials per compound and a greater number of patients per trial. As a result of
the growth in this segment, sponsors are increasing their reliance on clinical
trial outsourcing services to gain access to greater clinical trial capacity and
a larger supply of experienced clinical trial personnel with specific
therapeutic expertise. Management believes that science services in both the UK
and the US offer significant opportunities for future growth.

         Management Sector. The use of interim managers and executives in the UK
is an emerging market, in which the Company has been one of the leading
pioneers. There is now growing acceptance of the flexibility and cost
effectiveness of using interim managers alongside the regular management team,
not simply as a solution to a crisis. Management believes that the management
sector offers significant opportunities for future growth.

Business Strategy

         Management believes that the Company has achieved a strong competitive
position in the staffing industry attributable to a number of business
strategies, including the following:

         Operating only in specialized sectors. The Company operates in highly
focused sectors of the staffing industry through businesses with readily
identifiable trade names related to the sector served. These sectors are
technology, science and management and, as such, offer higher added value
services to clients. The Company believes that the large number of discrete
technology and scientific skills, the need for large candidate databases to
match candidates' skills with clients' needs and the importance of established
client relationships raise the barriers to entry for competitors in these
sectors. Through its teams of recruitment consultants and its delivery systems,
the Company believes it offers its clients quality service due to its
exceptional understanding of the skills required for each sector.

         Employing qualified and experienced sales teams. In the technology
sector, recruitment consultants are generally computer or business graduates,
trained in the specific industry in which they work. The Company's recruitment
consultants working in the scientific sector generally have university degrees
in science, including many with PhDs. Each consultant is qualified in a
specialized scientific discipline such as analytical chemistry, biochemistry,
microbiology, organic chemistry or food science, among others. As a result, the
Company's sales teams are experienced and well qualified to understand and serve
the specific needs of clients in each of the sectors in which it operates.

         Providing value-added services. Management places great importance on
providing a high quality, flexible service. Encouraging as well as responding to
the trend toward flexible employment practices, the Company is able to deliver
qualified candidates whose skills are carefully matched to each assignment and
who are available when needed. The Company focuses on achieving an exceptional
understanding of clients' needs, quickly identifying

                                       5

<PAGE>



suitable candidates who meet those needs and then managing the process of
selection and assignment and administering the ongoing service.

         Identifying qualified candidates. The Company invests in recruitment
advertising through the Internet and other media to identify and recruit
qualified professionals who are available for client assignments. The Company's
databases contain approximately 25,000 names in technology, 30,000 names in
science and 5,000 names in management.

         Emphasizing a partnership approach. Management emphasizes a partnership
approach that offers added value to both clients and candidates. For example,
Lab Staff advises candidates on interview and presentation skills. In addition,
the Company offers information to its clients regarding the availability of
skills and on appropriate and prevailing salary levels. Under S-Com's "Skills
Management" approach, the Company assesses with its clients both current and
future skills requirements. For its contractors S-Com EPL pays special
attention to financial, social and accommodation issues, particularly in the
case of remote or overseas assignments.

         Operating decentralized management with central financial controls.
Each of the Company's subsidiaries focuses on its own service sector,
technology, skills and clients. The Company operates in a decentralised manner
which encourages an entrepreneurial environment within each subsidiary.
Operating company managers are given latitude to concentrate on their market and
manage day-to-day operations within their areas of expertise. The Company's
management regularly monitors operations and results are reported and
consolidated monthly. The Company's businesses operate discrete accounting
systems in accordance with the specific requirements of each business, but
report results under a common reporting timetable and framework and according to
common accounting policies. Treasury operations are controlled centrally. Each
operating company's financial planning, budgeting and forecasting is
co-ordinated by the Company's Chief Financial Officer.

         Continuing investment in advanced information systems and office
technology. The Company believes its databases and operating systems permit a
rapid and precise response to client needs and a high degree of productivity.
Management believes that the responsiveness of these systems provides an
important competitive advantage. The Company budgets for continuing investment
in operating systems to benefit from advances in office technology.

Growth Strategy

         The Company is pursuing a growth strategy which includes investment in,
and development of, its current businesses combined with an acquisition strategy
to increase the size and scale of services within existing markets served and to
enter new specialty sectors.

         In the technology sector, the Company believes that it is well
positioned to generate internal growth as a result of its focus in the growing
telecommunications, datacommunications and IT industries and in the specialty
engineering sectors it serves. In addition, S-Com EPL has established a growing
presence in the United States and Germany.

         In the science sector, the Company intends to strengthen its position
as the market leader in the United Kingdom by expanding its range of staffing
services to higher skill levels and further promoting its existing brands. The
acquisition of Euromedica, the largest executive search firm in Europe dedicated
exclusively to the pharmaceutical, bioscience and healthcare sectors, expands
the Company's operations in science employment into selected European countries.
The acquisition of The Woolf Group gives the Company a significant presence in
science employment in the United States. The Company intends to accelerate the
implementation of The Woolf Group's growth strategies, which include entry into
new regional operations in the United States.

         In the interim management sector, a relatively new and developing
market, the Company believes it is well positioned to achieve greater market
penetration by increasing sales to existing clients and developing business with
new clients. The acquisition of Praxis further strengthened the position of the
Company in this sector, making it the leading provider of interim executives and
managers in the United Kingdom.

         The Company intends to pursue and evaluate further acquisition
opportunities which fit within its growth strategy. The Company's acquisition
policy is to expand its presence in its current sectors, facilitate entry into
new

                                        6

<PAGE>


geographic areas within its current sectors and permit expansion into new
specialty growth markets within the United Kingdom. The primary criteria for
evaluating each potential acquisition include the nature and degree of
specialization, growth potential within the sector served, geographic coverage,
quality of management and its commitment to the business on an ongoing basis,
profitability trends and transaction terms believed by the Company to be
favorable.

Operations

         The following table sets forth the structure, by sector, of the
Company's principal operations and services provided.
<TABLE>
<CAPTION>
Business Sector       Principal Industries Served                  Brand Name                        Services Provided
---------------       ---------------------------                  ----------                        -----------------
<S>                   <C>                                          <C>                               <C>
Technology            Telecommunications,                          S-Com EPL                        Temporary Staffing
                      Datacommunications,
                      IT, Specialty Software Engineering

Science               Pharmaceutical, Chemicals,                   Science Recruitment Group
                      Biotechnology, Food & Beverage,                  Lab Staff                     Temporary Staffing
                                                                       ESCA                          Permanent Recruitment
                                                                       Scientech                     Permanent Recruitment
                                                                   Salisbury Advertising &
                                                                      Marketing                      Recruitment Advertising
                                                                   Euromedica                        Executive Search
                                                                   The Woolf Group                   Clinical Trials Staffing

Management            All industry sectors                         Executives on Assignment          Temporary Staffing
                                                                   Praxis Executive Taskforce        Temporary Staffing
                                                                   ESA                               Permanent Recruitment and
                                                                                                     Temporary Staffing
</TABLE>

         In fiscal 1999, S-Com and EPL were fully integrated into a single
subsidiary of the Company operating under the S-Com EPL name.

         In fiscal 1999, following the determination of all remaining contingent
consideration, the Company restructured Salisbury's operations by selling or
terminating minor non-core activities and transferring other operations to the
Company's Management and the Science divisions. ESCA, which provides science
professionals for permanent appointments from research scientists through to
senior management levels, and Scientech, which supplies laboratory level
scientists and technicians for permanent positions, have been transferred to the
Science Recruitment Group. ESA, which provides permanent recruitment services in
technology and civil engineering, has been transferred to the management
division.

         Staffing and Recruitment Services in Technology

         S-Com EPL. S-Com EPL specializes in providing temporary and contract
systems engineers and other specialists to the telecommunications and
datacommunications industries. S-Com EPL also provides information technology
and specialty engineering skills to these and other sectors including the
defense industry and for air traffic control systems. Skills provided include
systems planning and design, project management, software application
development, systems and network implementation, systems integration, high-level
programming and system maintenance.

         S-Com EPL has pioneered a partnering approach with telecommunications
equipment manufacturers and service providers for the roll out of new networks
for mobile telephones. The Company identifies bidders for license awards and
helps the bidder to identify the specific skills required to complete the
rollout successfully. The Company plans the delivery of the technical personnel
required, and in some cases, subsequently manages the staffing of projects. The
planning process is generally undertaken some months before the license is
awarded. While the Company attempts to align itself strategically with key
bidders, it seeks to avoid exclusive arrangements so that it can provide
services to any successful bidder. S-Com EPL currently has operations in the
United Kingdom, Germany and in the United States and is providing contractors in
some 25 countries.


                                        7

<PAGE>




         Staffing and Recruitment Services in Science

         Lab Staff, ESCA and Scientech (the Science Recruitment Group). Lab
Staff is the leading temporary staffing business specializing in the laboratory
sciences in the United Kingdom. It provides temporary scientists and technicians
to industrial employers, government laboratories and research institutions
throughout the United Kingdom. Average assignment length is six months, and
approximately 15% of assignments are ultimately converted to permanent
assignments for which a fee is generally payable. ESCA and Scientech provide
scientific management and laboratory level permanent placement services,
respectively. The businesses seek to provide quality service to their clients by
understanding each client's highly technical needs, quickly identifying suitable
candidates that meet those needs and managing the process of introducing a
candidate and administering the ongoing service with a minimum of client
involvement.

         The three brands, Lab Staff, ESCA and Scientech, now operate within an
umbrella brand, the Science Recruitment Group which represents a single source
for science employers' recruitment needs whether for temporary or permanent
positions, senior management or laboratory technicians.

         Euromedica. Euromedica, which was acquired by the Company in March
1999, is the largest executive search firm in Europe dedicated exclusively to
the pharmaceutical, bioscience and healthcare sectors. Euromedica provides
executive-level recruitment services to clients through the United Kingdom and
continental Europe. The company has a network of offices serving the United
Kingdom, Belgium, Holland and Germany as well as licence arrangements covering
France and Spain and associates or joint ventures in the United States, the Far
East and India. The Company believes that the acquisition of Euromedica
substantially enhances the Company's permanent placement business while
providing Lab Staff with in-country bases and local expertise for assisting with
the development of temporary scientific staffing services in Europe.

         The Woolf Group. The Company acquired the Woolf Group in March 1999.
Headquartered in Chapel Hill, North Carolina, The Woolf Group specializes in the
recruitment and placement of clinical research professionals on a contract basis
for pharmaceutical, biotechnology, clinical research and site management
organizations. The Company also provides meeting planning services, primarily
for investigator meetings to initiate clinical trials, to those same companies.
In addition, the Company recently began providing permanent placement services
in response to the increasing demand for permanent clinical research
professionals and senior management positions. The Company's clients are
primarily located in North Carolina, Virginia, New Jersey, Pennsylvania,
California, Massachusetts, New York and Texas.

         The Woolf Group markets it clinical research staffing services to
companies engaged in the clinical trial stage of drug development. The Company
recruits and places a variety of clinical research professionals, including
monitors, project managers, medical writers, medical officers, clinical research
coordinators and quality assurance auditors. The objective of the clinical
staffing business is appropriately and responsively to identify and match
clinical research professionals with each client's staffing needs. To do so, The
Woolf Group adheres to a comprehensive standard operating procedure when seeking
to fulfil clients' requirements.

         Staffing and Recruitment Services in Interim Management

         Executives on Assignment and Praxis Executive Taskforce. The Company
acquired Praxis Executive Taskforce in October 1998. Executives on Assignment
and Praxis Executive Taskforce place experienced executives on temporary
assignments across all functions in all types of industrial, commercial and
public sector activity throughout the United Kingdom. Management believes that
together, these companies are the leading employment business dedicated
exclusively to this sector. All senior recruitment consultants in the business
are experienced executives with knowledge and insight into management and its
functions. Their effective selection of qualified candidates and accurate
matching of these to clients' needs is fundamental to the business. Assignments
range from senior executive officers to middle management, and are typically for
periods of six to twelve months.

         Candidates

         The identification and recruitment of qualified professionals who are
available for client assignments is a key component of the Company's operations.
The Company expends considerable efforts and resources in maintaining

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<PAGE>



its candidate databases. The Company's databases contain approximately 25,000
names in technology, 30,000 names in science, and 5,000 names in management.

         Candidates are sourced principally through advertising and direct
solicitation. In the technology sector, candidates are sourced through
advertising in trade journals such as Mobile Europe, Computer Weekly and
Computer Contractor, as well as globally through the Internet. In the science
sector, the Company advertises in the specialty trade press such as New
Scientist, Chemistry in Britain and other journals relevant to a specific
industry such as food, plastics or biotechnology. In the management sector
candidates are sought through advertising, usually in national newspapers such
as The Times, The Sunday Times and The Daily Telegraph. The Company also
receives a considerable number of unsolicited resumes without the need for
specific advertising or solicitation. Universities are a valued source of newly
qualified candidates and the Company recruits at a number of universities
through university web sites and attendance at career and job fairs.

         In technology, candidates are selected for possible assignments
initially on the basis of the technical information provided on the resume and
are normally interviewed in depth on the telephone and in person where
appropriate. The recruitment consultant assesses a candidate's suitability for
the assignment based on a detailed understanding of the skills required by a
client. In science, all candidates for temporary or permanent positions are
interviewed in person by the Company's recruitment consultants and their skills
and experience are precisely matched to the demands of the assignment. In
management, only candidates meeting strict selection criteria are accepted onto
the Company's database. Those selected for possible assignments are interviewed
personally by both the Company's recruitment consultants and by the client.

         Clients

         Over 60% of the Company's revenues in the technology sector are derived
from clients in the telecommunications industry and include both equipment
manufacturers and service providers such as BT, Orange, Ericsson, Qualcomm,
Lucent Technologies and Nokia. Clients in datacommunications include BT,
National Westminster Bank, Racal and IBM. BT is the largest client, accounting
for approximately 9% of the Company's revenues for the year ended March 31,
1999. Other clients include GEC Marconi, Raytheon, the Defence Research
Association, the Civil Aviation Authority and the National Air Transport System.
Staffing assignments are agreed on the basis of rates and terms negotiated for
each assignment or which form part of a preferred supplier agreement. In
international telecommunications rollouts, the Company does not enter into
contractual commitments to provide services on any date or at any specific cost,
nor are there penalties for failure to deliver personnel, to complete a rollout
in a given manner or by a specified time.

         In the science sector, clients include leading pharmaceutical,
biotechnology, chemical, environmental, petrochemical, food and beverage and
manufacturing companies as well as government laboratories and research
institutions. The Company's major clients within the science sector include
Glaxo Wellcome, Astra Zeneca, SmithKline Beecham, Merck, Sharp & Dohme and Evans
Medical. In temporary staffing, the majority of the Company's agreements with
customers cover assignments with rates and on terms negotiated for each
assignment. However, the Company has entered into special agreements with
certain regular clients covering services supplied, bill rates, conversion fees,
discounts and rebates. Such agreements generally have a term of one year. None
of these agreements requires clients to use the Company's services.

         Clients in the management sector are found in a broad cross section of
industry, commerce, financial services and public sectors and range in size from
small companies to very large global organizations. Assignments for temporary
executives have been in general management, sales, marketing, finance,
information technology, human resources and production.

         Quality

         Management attaches great importance to providing high quality services
on a consistent and regular basis. Most of the Company's technology and science
staffing companies are ISO 9002 accredited. The Company has implemented
comprehensive internal quality policies that control, monitor and record a
number of procedures. Such policies include quality control calls that are
generally made during the first week and periodically throughout temporary
assignments to ensure that both client and temporary worker are satisfied with
the progress of the

                                        9

<PAGE>



assignment. Lab Staff clients are asked to complete candidate assessments which
are regularly summarized and reviewed by management. Permanent recruitment
services are governed by quality control procedures from the outset of the
recruitment process, through the appointment of the selected candidate to
follow-up calls some weeks later. The initial stages involve very detailed
liaison between the Company and its clients to ensure a complete understanding
by the Company of clients' needs.

         Sales and Marketing

         Each operating company has developed a sales and marketing strategy to
address specific needs within each sector served. In the technology sector,
S-Com's recruitment consultants focus on developing client relationships through
regular contacts at various levels within a client's organization. This may
involve spending time on the clients' premises or on site to gain deeper
understanding of future projects and the skills required for these. S-Com is a
pioneer in the "Skills Management" process whereby its staff, with clients,
jointly assess future skills requirements and plan accordingly. In the science
sector, marketing focuses primarily on temporary scientific personnel, and is
targeted toward laboratory managers and research or development directors. The
Company also targets human resource departments. Marketing methods include
seminars, direct mail, publication of articles in national and trade press
journals and exhibits at trade shows as well as telephone contact and client and
prospect site visits. In the management sector, potential clients are targeted
through direct contact and mailing and public relations programs including a
newsletter, The Interim. Marketing also includes management briefings for chief
executives, human resource directors and finance directors.

         Information Systems

         Information systems are fundamental to the operations of the Company
due to the broad range of specialty skills employed in the sectors served. A
client's request typically specifies not only a particular skill, but also a
specific level of educational qualification, the type of industry experience,
the functions performed and the total years of experience required. Because of
these requirements, each business has developed a candidate database that allows
rapid identification of suitable candidates who meet the client's specified
criteria.

Competition

         In each of the sectors in which the Company operates, the staffing
services industry is fragmented and highly competitive with relatively low
barriers to entry. Competition and the Company's competitive position in the
technology sector vary across the industries served. In international
telecommunications staffing, S-Com EPL has established a leading position with
few competitors having similar skills and industry expertise. In the U.K.
telecommunications, data communications and information technology markets,
S-Com EPL faces competition from a number of IT staffing companies but seeks to
position itself as a specialist provider of technical skills often supporting
clients' R&D activities. Competitors include Glotel, a telecommunications
specialty services provider, as well as numerous IT staffing companies such as
Delphi Group, Parity, Abraxas (part of Select Appointments) and Lorien.

         In the science sector, management believes that Lab Staff is the only
scientific staffing company in the United Kingdom with an extensive nationwide
presence and which specializes in all levels of science employment. Competition
is usually regional in nature with few companies specializing in science. ESCA
and Scientech are among several leading recruitment businesses specializing in
the permanent placement of scientists. These businesses also compete with
certain national search firms who, while not specializing in science, accept all
types of recruitment assignments at senior executive levels.

         In the management sector, Executives on Assignment and Praxis Executive
Taskforce are one of the leaders in the field of interim management and face
competition from other specialist providers, of which management believes there
are three or four. Some search firms and management consultants, such as PA
Consulting, also operate in this sector.

         Management believes that the Company's competitiveness is based on its
ability to understand a client's specific needs, the ability to deliver
qualified candidates whose skills are well matched to those needs and on the
pricing of its services.

                                       10

<PAGE>




         The principal competitive factors in attracting qualified candidates
are salaries and benefits and the availability, duration and quality of
assignments. Management believes that many candidates seeking temporary or
permanent assignments through the Company are also pursuing employment through
other means, including other temporary employment service firms. Increasing
demand, particularly in the technology sector, has reduced the pool of available
specialty professionals and increased difficulty of finding qualified
candidates. Therefore, the Company's reputation and its ability to offer
appropriate assignments are important factors in the Company's ability to
attract high-quality candidates. In permanent recruitment, the ability to secure
quality job opportunities from quality clients will determine competitive
advantage and will help to attract suitable candidates.

Employees

         At March 31, 1999, the Company had 251 employees (full-time
equivalent), of whom approximately 160 were recruitment consultants and
operational staff. None of the Company's employees, or its temporary workers, is
represented by a collective bargaining agreement. The Company believes that its
employee relations are good.

Regulation

         Staffing services firms are generally subject to one or more of the
following types of government regulations: (i) regulation of the
employer/employee relationship between a firm and its staffing personnel; (ii)
registration, licensing, record keeping and reporting requirements; and (iii)
substantive limitations on its operations, including (a) restrictions on
categories of workers that may be placed pursuant to temporary employment
contracts; (b) limitations on the duration of such contracts; and (c)
restrictions on or prohibition of permanent placement of staff in certain
jurisdictions. Accordingly, staffing companies must comply with laws and
regulations that govern the employer/employee relationship, such as tax
withholding or reporting, social security or retirement, anti-discrimination and
workers' compensation.

         As a staffing services business operating in the United Kingdom, the
Company is subject to the Employment Agencies Act 1973, which imposes certain
obligations of fair practice on the Company. The Company believes that it
complies in all material respects with these regulations. Although the Company's
business is not specifically regulated by European Union ("EU") regulation, the
EU has in the past attempted to introduce measures relating to rights of workers
generally. A number of European countries require staffing companies to maintain
some form of license or permit which is issued by the applicable authorities.
Certain European countries require the operations of staffing companies to be
supported by bank guarantees. A number of other restrictions and requirements
are common to regulations in European countries, including certain requirements
for contracts between clients and staffing companies, limitations in the
conditions under which temporary work is allowed, limitations in the duration of
staffing contracts (varying from three to 24 months) and requirements for wage
levels and social security. Management believes that the Company complies in all
material aspects with these regulations, to the extent applicable. However,
there can be no assurance that, as regulatory regimes evolve or change in
particular jurisdictions, the operations or performance of the Company will not
be affected.

         In the United Kingdom, all mandatory social benefits (including
unemployment, national healthcare and pensions benefits) are funded by employers
and employees through National Insurance contributions. The rates for National
Insurance are established on a national basis and vary only by compensation and
not job classification or other risk or cost-adjusted criteria. This is in
contrast to U.S. companies which generally are responsible for the management
and payment of unemployment insurance and workers' compensation premiums in
addition to social security contributions under state and federal programs and
optional health benefits. In the U.S., there is no federal legislation
specifically related to the regulation of staffing businesses, although some
states have licensing requirements.

         In the past twelve months the UK Government has passed a number of
significant laws affecting employment relationships and the relationship that an
employment business has with its own employees and its temporary workers. These
are (i) the Working Time Regulations, (ii) the National Minimum Wage, (iii)
Public Interest Disclosure Act, and the Employment Relations Bill which is
currently making its way through Parliament. These laws all apply to "workers"
and are not limited to "employees", which means that the rules can apply to
agency temporary workers. The Working Time Regulations regulate hours worked,
rest breaks, holidays and record keeping. The National Minimum Wage sets out
minimum rates of pay and the Public Interest Disclosure Act provides certain
rights to

                                       11

<PAGE>


workers who disclose alleged wrongdoing in defined circumstances. The Employment
Relations Bill, in its present form, covers the areas of trades unions,
maternity provisions, and unfair dismissal rights.

         Under "IR35", a recently announced Inland Revenue proposal, legislation
is intended to be introduced (to take effect on 6 April 2000) to prevent tax
avoidance through the hiring of individuals through their own personal service
companies. Employers and employees are currently able to pay less income tax and
National Insurance by arranging for the employee to be engaged indirectly
through the medium of a company. It is intended that the changes will ensure
that people working in such "disguised employment" will pay the same tax and
National Insurance as an employee.

         The Department of Trade and Industry published a consultation document
in May 1999 concerning the Regulation of the United Kingdom Recruitment
Industry. The proposals include measures to restrict the charging of fees which
might discourage clients from transferring a temporary worker to a permanent
employee and to ensure that temporary workers have a contractual relationship
with an employment business.

         The Company is responding to the consultation document and to IR35
through its trade body. The Company supports stronger regulation of its industry
in the UK although some of the measures under consultation may have a
detrimental effect on its business.

         The Company's growth strategy includes expansion into other countries
in Europe and internationally. The Company will carefully evaluate the
regulatory environment of any market in determining where to pursue such
expansion.


Item 2.  DESCRIPTION OF PROPERTY

         The Company owns approximately 7,600 square feet of office space at its
headquarters in Langley (near London). The Company also leases offices in London
Docklands, Hatfield, Aylesbury, Windsor (all within an hour of London),
Cambridge, Coleshill (near Birmingham), as well as having a network of serviced
offices throughout the UK. The Company also has leased offices in Chapel Hill
and San Francisco in the U.S., and in Brussels and Munich in continental Europe.
The Company's leased offices occupy approximately 40,000 square feet in the
aggregate. The Company believes that its facilities are adequate for its short
term needs.


Item 3.  LEGAL PROCEEDINGS

         The Company may from time to time be involved in routine litigation
incidental to the conduct of its business. There is no material pending
litigation to which the Company is a party.


Item 4.  CONTROL OF REGISTRANT

         As far as known to the Company, the Company is not directly or
indirectly owned or controlled by another corporation or by any government.

         The following table sets forth information regarding the beneficial
ownership of the Shares as of June 30, 1999, by (i) each person known by the
Company to own beneficially more than 10% of the outstanding Shares and (ii) all
directors and executive officers as a group.

                                       12

<PAGE>


<TABLE>
<CAPTION>
Title of Class           Identity of Person or Group              Amount Owned              Percent of Class
--------------           ---------------------------              ------------              ----------------

<S>                      <C>                                        <C>                          <C>
Ordinary Shares          Bruce R. Culver                            1,127,800                    13.2%

Ordinary Shares          Board of Directors as a group
                         (6 persons)                                1,933,800                    22.7%

Ordinary Shares          T. Rowe Price Associates                     854,900                    10.1%
</TABLE>

         The Company does not know of any arrangements which might result in a
change in its control.


Item 5.  NATURE OF TRADING MARKET

         The Company's Ordinary Shares are traded in the form of American
Depositary Shares ("ADSs"), each ADS representing one Ordinary Share, on the
Nasdaq National Market under the symbol "PSTF". The ADSs are evidenced by
American Depositary Receipts ("ADRs") issued by The Bank of New York, as
Depositary, under a Deposit Agreement, dated as of June 8, 1996, among the
Company, The Bank of New York and the registered holders from time to time.

         The following table shows, for the calendar periods indicated, the
reported highest and lowest middle market quotations for the Company's ADSs on
the Nasdaq National Market, based on the highest and lowest sales prices of the
ADSs.


                                                          U.S. Dollars per ADS
                                                         -----------------------
                                                           High          Low
                                                         ---------    ----------
1997:
   Third Quarter.......................................    16           11 1/2
   Fourth Quarter......................................    18 1/4       15
1998:
   First Quarter.......................................    18 3/4       15
   Second Quarter......................................    19 1/2       11 1/2
   Third Quarter.......................................    16 1/8        9 7/8
   Fourth Quarter......................................    11 1/2        6 3/8
1999:
   First Quarter.......................................     8 3/4        6
   Second Quarter (through June 30)....................     7 3/8        5 11/16

         According to information provided by The Bank of New York, the
Depositary, as of June 30, 1999, there were 22 registered U.S. holders of
8,206,839 ADSs. In the aggregate, such holdings constituted 96.3% of the total
outstanding Shares of the Company. Since certain of the Shares and ADSs are held
by brokers and other nominees, these numbers may not be representative of the
actual number of U.S. beneficial holders or of the number of Shares or ADSs
beneficially held by U.S. persons.


Item 6.  EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY HOLDERS

         There are currently no U.K. foreign exchange control restrictions on
the payment of dividends on Ordinary Shares or on the conduct of the Company's
operations.

         There are currently no limitations on grounds of nationality imposed by
English law or by the Company's Articles of Association on the rights of
non-U.K. holders of Ordinary Shares to hold, own or vote such securities.

                                       13

<PAGE>


Item 7.  TAXATION

         The following discussion summarizes the material U.S. federal income
tax consequences and U.K. tax consequences of the acquisition, ownership and
disposition of Ordinary Shares represented by ADSs evidenced by ADRs by a
beneficial owner of ADSs that is (i) a citizen or resident of the United States,
(ii) a corporation organized under the laws of the United States or any state
thereof or the District of Columbia or (iii) otherwise subject to U.S. federal
income tax on a net income basis in respect of the Ordinary Shares or ADSs (a
"U.S. Holder"). This summary applies only to U.S. Holders who will hold ADSs as
capital assets. This summary is based (i) upon current U.K. tax law and U.S.
law, and U.K. Inland Revenue and U.S. Internal Revenue Service practice, (ii)
upon the United Kingdom-United States Income Tax Convention as in effect on the
date of this Annual Report (the "Treaty") and the United Kingdom-United States
Convention relating to estate and gift taxes as in effect on the date of this
Annual Report (the "Estate Tax Treaty"), and (iii) in part upon representations
of the Depositary and assumes that each obligation provided for in or otherwise
contemplated by the Deposit Agreement and any related agreement will be
performed in accordance with their respective terms.

         The following summary of certain U.S. federal income tax considerations
does not address all of the tax consequences to certain categories of U.S.
Holders who may be subject to special rules (such as United States expatriates,
insurance companies, regulated investment companies, tax-exempt organizations,
financial institutions, persons subject to the alternative minimum tax,
securities brokers-dealers, U.S. Holders who hold ADSs as part of hedging or
conversion transactions or U.S. Holders who own directly, indirectly or by
attribution 10% or more of the voting power of the Company) and U.S. Holders
whose functional currency for U.S. tax purposes is not the United States dollar.
In addition, the following summary of certain U.K. tax considerations does not
address the tax consequences to a U.S. Holder (i) that is resident (or, in the
case of an individual, ordinarily resident) in the United Kingdom for U.K. tax
purposes, (ii) whose holding of ADSs is effectively connected with a permanent
establishment in the United Kingdom through which such U.S. Holder carries on
business activities or, in the case of an individual who performs independent
personal services, with a fixed base situated therein, or (iii) that is a
corporation which alone or together with one or more associated corporations,
controls directly or indirectly, 10% or more of the Company.

         Holders of Ordinary Shares or ADSs should consult their own tax
advisors as to the consequences under foreign, U.S. state and local, and other
laws, of the acquisition, ownership and disposition of ADSs. For U.S. federal
income tax purposes, U.S. Holders of ADSs will be treated as owners of the
underlying Ordinary Shares attributable thereto and this discussion of U.S.
federal income tax consequences to U.S. Holders of ADSs applies as well to U.S.
Holders of Ordinary Shares.

Certain United Kingdom Tax Considerations

Taxation of Dividends

         The taxation treatment of dividends paid in respect of the ADSs will
depend upon the law and practice in force at the time dividends are paid. The
following summary is based upon current law and practice, which may change by
the time that any dividends become payable.

         The UK Government has announced changes to the taxation of dividends
which affect the position of shareholders in respect of dividends paid on or
after April 6, 1999. With effect from this date, UK companies are not required
to account for advance corporation tax when a dividend is paid. The rate of tax
credits is halved to 10 per cent and tax credits are no longer payable to
shareholders with no tax liability. Individual UK resident shareholders whose
income is within the lower or basic rate tax bands are liable to tax at 10 per
cent and the tax credit will satisfy their tax liability. Individual UK resident
shareholders whose income is subject to income tax at the higher rate are liable
to tax at 32.5 per cent.

         Under the Treaty, a US investor is entitled to receive from the Inland
Revenue, in addition to any dividend, the tax credit, subject to a UK
withholding tax equal to 15 per cent of the gross dividend. However, because the
15% UK withholding tax currently exceeds the tax credit amount (which is equal
to one-ninth of the dividend), a US investor will not receive any treaty payment
from the UK Inland Revenue.


                                       14

<PAGE>


         Under the terms of the Treaty, US resident individuals and corporations
controlling less than 10% of the voting stock of the Company are technically
entitled to a refund from the UK Inland Revenue calculated by reference to the
amount of the tax credit available to a UK individual. However, the reduction in
the value of the tax credit on dividends paid to UK individuals to one-ninth of
the dividend from 6 April 1999 means that no refunds will be made to US
stockholders holding less than 10% of the Company's voting stock.

         U.S. Holders who are not resident or ordinarily resident for tax
purposes in the United Kingdom and have no other source of U.K. income are not
required to file a U.K. income tax return.

Taxation of Capital Gains

         U.S. Holders who are not resident or ordinarily resident for tax
purposes in the United Kingdom will not be liable for U.K. tax on capital gains
realized on the disposal of their ADSs unless such ADSs are used, held or
acquired for the purposes of a trade, profession or vocation carried on in the
United Kingdom through a branch or agency.

         The surrender of ADSs in exchange for Shares will not be a taxable
event for the purposes of U.K. corporation tax or U.K. capital gains tax.
Accordingly, U.S. Holders will not recognize any gain or loss for such purposes
upon such surrender.

         A US Holder who becomes resident in the United Kingdom after a period
of "temporary" non-residence (of up to five tax years) following an earlier
period of residence in the United Kingdom will be liable to capital gains tax.

Inheritance and Gift Taxes

         An individual who is domiciled in the United States for the purposes of
the Estate Tax Treaty and who is not a national of the United Kingdom for the
purposes of the Estate Tax Treaty will generally not be subject to U.K.
inheritance tax in respect of the ADSs on the individual's death or on a gift of
the ADSs during the individual's lifetime provided that any applicable U.S.
federal gift or estate tax liability is paid, unless the ADSs are part of the
business property of a permanent establishment of an enterprise of the
individual in the United Kingdom or pertain to a fixed base in the United
Kingdom of the individual used for the performance of independent personal
services. Where the ADSs have been placed in trust by a settlor who, at time of
settlement, was a U.S. Holder, the ADSs will generally not be subject to U.K.
inheritance tax unless the settlor, at the time of settlement, was not domiciled
in the United States and was a U.K. national. In the exceptional case where the
ADSs are subject both to U.K. inheritance tax and to U.S. federal gift or estate
tax, the Estate Tax Treaty generally provides for the tax paid in the United
Kingdom to be credited against tax paid in the United States or for tax paid in
the United States to be credited against tax payable in the United Kingdom based
on priority rules set out in that Treaty.

U.K. Stamp Duty and Stamp Duty Reserve Tax

         A transfer for value of the Shares will generally be subject to U.K. ad
valorem stamp duty, normally at the rate of 50p per (pound)100 (or part thereof)
of the amount or value of the consideration given for the transfer irrespective
of the identity of the parties to the transfer and the place of execution of any
instrument of transfer. Stamp duty is normally a liability of the purchaser.

         An agreement to transfer Shares for money or money's worth will
normally give rise to a charge to stamp duty reserve tax ("SDRT") at the rate of
0.5% of the amount or value of the consideration for the Shares unless an
instrument of transfer of the Shares is executed in pursuance of the agreement
and is duly stamped. SDRT is in general payable by the purchaser.

         A stamp duty charge at the higher rate of (pound)1.50 per (pound)100
(or part thereof) or, in the case of SDRT, a charge at the higher rate of 1.5%
of the amount or value of the consideration, or in some circumstances, the value
of the Shares, may arise on a transfer or issue of the Shares (i) to, or to a
nominee for, a person whose business is or includes the provision of clearance
services or (ii) to, or to a nominee or agent for, a person whose business is or
includes issuing depositary receipts. Under the U.K. Finance Act 1996, as from
July 1, 1996, an option has been introduced whereby clearance services may opt,
under certain conditions, for the normal rates of SDRT to apply to a transfer of
shares into, and to transactions within, the service instead of the higher rate
applying to an issue or

                                       15

<PAGE>



transfer of shares into the clearance service. From March 9, 1999, where
securities are held by persons providing clearance services, but whose business
is not exclusively that of providing such services, agreements to transfer
securities held in this way are exempt from the principal charge to SDRT.

         In accordance with the terms of the Deposit Agreement, (i) the Company
will pay all U.K. stamp duty or SDRT charges that arise as a result of the
initial deposit by the Company of Shares with the Depositary pursuant to the
Offering (ii) the Selling Shareholders will pay all U.K. stamp duty or SDRT
charges that arise as a result of the initial deposit by the Selling
Shareholders with the Depositary pursuant to the Offering and (iii) any tax or
duty payable by the Depositary or the Custodian of the Depositary on any
subsequent deposit of Shares will be charged by the Depositary to the holder of
the ADS or any deposited security represented by the ADS.

         No U.K. stamp duty will be payable on the acquisition or transfer of an
ADS evidenced by an ADR or of beneficial ownership of an ADS, provided that any
instrument of transfer or written agreement to transfer remains at all times
outside the United Kingdom, and provided further that any instrument of transfer
or written agreement to transfer is not executed in the United Kingdom and the
transfer does not relate to any matter or thing done or to be done in the United
Kingdom. An agreement for the transfer of an ADR or the beneficial ownership of
an ADR will not give rise to a liability to SDRT. The UK Chancellor of the
Exchequer announced on March 9, 1999 that with effect from October 1, 1999
interest will be charged on duty that is not paid within 30 days of execution of
a transfer of securities subject to stamp duty, wherever execution takes place.
Interest paid will not be allowable as a deduction in computing profits and
losses for tax purposes. Penalties will also apply to document submitted for
stamping more than 30 days after the document was executed. For document
executed outside the UK, penalties will apply to documents not submitted for
stamping within 30 days after they are first brought into the UK.

         Any transfer for value of the underlying Shares represented by ADSs
evidenced by ADRs, may give rise to a liability to U.K. stamp duty or SDRT. The
amount of U.K. stamp duty or SDRT payable is generally calculated at the
applicable rate on the consideration for the transfer of the Shares at the rate
of 50p per (pound)100 (or part thereof), or in the case of SDRT, at the rate of
0.5% of the amount or value of the consideration; however, on a transfer from
the Custodian of the Depositary to a holder of an ADS upon cancellation of the
ADS, only a fixed U.K. stamp duty of 50p per instrument of transfer will be
payable.

Certain United States Federal Income Tax Considerations

Taxation of Dividends

         The gross amount of distributions made with respect to ADSs (including
the full amount of the related Tax Credit and unreduced by any U.K. withholding
taxes) will constitute dividends for U.S. federal income tax purposes to the
extent paid out of current or accumulated earnings and profits of the Company as
determined for U.S. federal income tax purposes. To the extent that a
distribution exceeds the earnings and profits of the Company, it will be treated
as a nontaxable return of capital to the extent of the U.S. Holder's adjusted
tax basis in the ADS and thereafter as a capital gain. Dividends paid by the
Company generally will be treated as foreign source dividend income and will not
be eligible for the dividends received deduction allowed to corporate
shareholders under the U.S. Internal Revenue Code.

         The amount of any distribution will equal the fair market value in U.S.
dollars of the pounds sterling (or other foreign currency) or other property
received on the date received by the U.S. Holder, in the case of Ordinary
Shares, or received by the Depositary, in the case of ADSs, which, in the case
of a distribution paid in pounds (or other foreign currency) will be based on
the spot exchange rate on such date. A U.S. holder will have a basis in any
pounds sterling (or other foreign currency) distributed, for U.S. federal income
tax purposes, equal to the dollar value of pounds sterling (or other foreign
currency) on the date received by the U.S. Holder, in the case of Ordinary
Shares, or received by the Depositary, in the case of ADSs. Any gain or loss
recognized upon a subsequent disposition of pounds sterling (or other foreign
currency) will generally be ordinary income or loss.

         Subject to certain complex limitations and only to the extent of the
related tax credit amount, the 15% U.K. withholding tax will be treated for U.S.
tax purposes as a foreign tax that may be claimed as a foreign tax credit
against the U.S. federal income tax liability of the U.S. Holder. Dividends
distributed by the Company will generally


                                       16

<PAGE>



be categorized as "passive income" or, in the case of certain holders, as
"financial services income," for purposes of computing allowable foreign tax
credits for U.S. tax purposes. The rules relating to the determination of the
foreign tax credit are complex and U.S. Holders should consult their tax
advisors to determine whether and to what extent a credit would be available. In
lieu of claiming a credit, a U.S. Holder may claim a deduction of foreign taxes
paid in the taxable year. A deduction does not reduce U.S. tax on a dollar for
dollar basis like a tax credit. The deduction, however, is not subject to the
limitations described above.

Taxation of Capital Gains

         A U.S. Holder will, upon the sale or exchange of an ADS, recognize a
gain or a loss for U.S. federal income tax purposes in an amount equal to the
difference between the amount realized and the U.S. Holder's adjusted tax basis
in the ADS. Such gain or loss will be a capital gain or loss if the ADS was a
capital asset in the hands of the U.S. Holder. Such gain or loss will generally
be treated as U.S. source gain or loss. In the case of a U.S. Holder who is an
individual, capital gains will generally be subject to U.S. federal income tax
at preferential rates if specified minimum holding periods are met.

         The surrender of ADSs in exchange for Shares will not be a taxable
event for U.S. federal income tax purposes. Accordingly, U.S. Holders will not
recognize any gain or loss upon such surrender.

Passive Foreign Investment Company Status

         The Company believes that it will not be treated as a passive foreign
investment company ("PFIC") for U.S. federal income tax purposes for the current
taxable year or for future taxable years. However, such a determination is
fundamentally factual in nature and generally cannot be made until the close of
the applicable taxable year. The Company will be a PFIC if either 75% or more of
its gross income in a tax year is passive income or the average percentage of
its assets (by value or adjusted basis, in certain circumstances) that produce
or are held for the production of passive income is at least 50%.

         If the Company were to be classified as a PFIC, a U.S. Holder generally
would be subject to adverse U.S. federal income tax consequences on certain
distributions and on any gain realized from a sale or other disposition of
Ordinary Shares or ADSs. U.S. Holders of Ordinary Shares or ADSs are urged to
consult their own tax advisors concerning the potential application of the PFIC
rules to their ownership or disposition of Ordinary Shares or ADSs.

United States Information Reporting and Backup Withholding

         Dividend payments with respect to ADSs and proceeds from the sale,
exchange or redemption of ADSs may be subject to information reporting to the
IRS and possible U.S. backup withholding at a 31% rate. Backup withholding will
not apply, however, to a holder who furnishes a correct taxpayer identification
number or certificate of foreign status and makes any other required
certification or who is otherwise exempt from backup withholding. Persons
required to establish their exempt status generally must provide such
certification on IRS Form W-9 (Request for Taxpayer Identification Number and
Certification) in the case of U.S. persons and on IRS Form W-8 (Certificate of
Foreign Status) in the case of non-U.S. persons. Finalized Treasury regulations,
which are applicable to payments made after December 31, 2000, have generally
expanded the circumstances under which information reporting and backup
withholding may apply unless the holder provides the information described
above.

         Amounts withheld as backup withholding may be credited against a
holder's U.S. federal income tax liability, and a holder may obtain a refund of
any excess amounts withheld under the backup withholding rules by filing the
appropriate claim for refund with the IRS and furnishing any required
information. U.S. Holders of Ordinary Shares or ADSs should consult their tax
advisors regarding the application of the backup withholding and information
reporting rules.

         Item 8. SELECTED FINANCIAL DATA

         The following table sets forth selected financial data of the Company.
The selected financial data for the five fiscal years ended March 31, 1999, have
been excerpted or derived from the Company's consolidated financial statements
for the fiscal years ended March 31, 1995, 1996, 1997, 1998 and 1999 which have
been audited by

                                       17

<PAGE>


Deloitte & Touche, Chartered Accountants. The data should be read in conjunction
with the Consolidated Financial Statements included elsewhere in this Annual
Report and Item 9., Management's Discussion and Analysis of Financial Condition
and Results of Operations.

<TABLE>
<CAPTION>
                                                                                   Fiscal Years Ended March 31,
                                                           -------------------------------------------------------------------------
                                                                 1995         1996            1997           1998          1999
                                                                 ----         ----            ----           ----          ----
                                                                              (thousands, except per share amounts)
<S>                                                        <C>            <C>            <C>            <C>            <C>
Consolidated Income Statement Data
    Revenue ...............................................(pound)11,943  (pound)15,996  (pound)19,666  (pound)58,313  (pound)95,359
    Direct cost of revenue ................................        8,134         10,863         13,636         43,715         74,210
                                                                   -----         ------         ------       --------         ------

    Gross profit ..........................................        3,809          5,133          6,030         14,598         21,149
    Selling, general and administrative expenses(4) .......        1,801          2,408          2,998          9,660         16,076
    Amortization of goodwill ..............................           --             --             --            193            375
                                                                   -----         ------         ------       --------         ------
    Income from continuing operations before other
            income and income taxes .......................        2,008          2,725          3,032          4,745          4,698
    Other income ..........................................           83            126            550            410          1,435
                                                                   -----         ------         ------       --------         ------

    Income from continuing operations before
            income taxes and discontinued operations ......        2,091          2,851          3,582          5,155          6,133
    Income taxes ..........................................          708            970          1,253          1,711          2,084
                                                                   -----         ------         ------       --------         ------

    Net income from continuing operations(2) ..............        1,383          1,881          2,329          3,444          4,049
                                                                   =====         ======         ======       ========         ======

Earnings per Share Data
Basic
    Net income per share from continuing operations .......  (pound)0.79    (pound)1.07    (pound)0.47    (pound)0.59    (pound)0.45
    Number of shares used in computation ('000) ...........        1,758          1,758          4,968          5,864          8,929
Fully diluted
    Net income per share from continuing operations .......  (pound)0.31(3) (pound)0.40    (pound)0.40    (pound)0.51    (pound)0.43
    Number of shares used in computation ('000) ...........        4,467          4,696          5,839          6,787          9,381
</TABLE>
<TABLE>
<CAPTION>
      1999(1)
     --------
<S>  <C>
     $153,909
      119,775
     --------

       34,134
       25,947
          605
     --------

        7,583
        2,316
     --------


        9,899
        3,364
     --------

        6,535
     ========



     $   0.73
        8,929

     $   0.69
        9,381
</TABLE>

<TABLE>
<CAPTION>
                                                                               At March 31,
                                      ----------------------------------------------------------------------------------------------
                                            1995          1996           1997            1998           1999             1999(1)
                                            ----          ----           ----            ----           ----             ----
                                                                                (thousands)
<S>                                   <C>           <C>            <C>              <C>           <C>                    <C>
Consolidated Balance Sheet Data
    Working capital.................  (pound)1,014  (pound)1,768   (pound)11,975    (pound)7,044  (pound)18,192          $29,362
    Total assets....................         4,646         6,302          17,470          26,581         62,767          101,306
    Long-term debt..................            61           522              --              --             69              111
    Shareholders' equity............         1,563         2,775          13,516          17,000         46,053           74,330
<FN>
------------------
(1)    Solely for the convenience of the reader, pound sterling amounts have been translated into U.S. dollars at the Noon Buying
       Rate on March 31, 1999 of $1.6140 per(pound)1.00.
(2)    Effective March 1996, the Company sold the ongoing businesses of its French operations acquired in fiscal 1993. The Company
       has recorded the results of its French operations in fiscal years 1995 and 1996 and the losses on the sale of the French
       businesses in fiscal 1996 and 1997 as discontinued operations.
(3)    Net income per share from continuing operations in fiscal 1995 includes the effect of a special dividend of(pound)375,000
       paid to holders of the Company's convertible preferred shares.
(4)    Includes in 1999(pound)809,000 of unusual items for restructuring and merging of acquired operations.
</FN>
</TABLE>


Dividends

         The Company has not paid dividends on its Ordinary Shares since its
incorporation in 1990. The Board of Directors does not currently anticipate
paying dividends in the foreseeable future. Management expects that all
available cash from operations will be used to meet the Company's projected
capital and other expenditure requirements, including those related to its
expansion plans.

         Under English law, the Company may only pay dividends out of profits
available for that purpose. Cash dividends, if any, will be paid by the Company
in pounds sterling and converted by the Depositary into U.S. dollars, subject to
the terms of the Deposit Agreement. Holders of ADSs on the relevant record date
will receive their portion of any dividends or distributions paid on the
Ordinary Shares, subject to the terms of the Deposit Agreement. Exchange rate
fluctuations will affect the U.S. dollar amount received by holders of ADSs on
conversion by the Depositary of dividends paid in pounds sterling.

Exchange Rate Information

                                       18

<PAGE>



         The table below sets forth, for the periods and dates indicated,
certain information concerning the Noon Buying Rates for pounds sterling
expressed in U.S. dollars per pound. Fluctuations in the exchange rate between
the pound sterling and the U.S. dollar will affect, among other things, the
market price of the ADSs, the U.S. dollar amount received by holders of ADSs on
conversion by the Depositary of any cash dividends paid in pounds sterling on
the Ordinary Shares and the U.S. dollar translation of the Company's results of
operations and financial condition.


                                                              Period      Period
Period                                       High    Low      Average(1)   End
------                                       ----    ---      -------      ---

1993.................................        1.59    1.42     1.50        1.48
1994.................................        1.64    1.46     1.54        1.57
1995.................................        1.64    1.53     1.58        1.55
1996.................................        1.71    1.49     1.57        1.71
1997.................................        1.70    1.58     1.65        1.67
1998 ................................        1.72    1.61     1.66        1.66
1999 (Through June 29)...............        1.66    1.59     1.61        1.58
------------------

(1)    The average of the Noon Buying Rates on the last business day of each
       month during the period.


Item 9.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF
           FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         The following discussion and analysis should be read in conjunction
with the Consolidated Financial Statements and Notes thereto and Item 8.
Selected Financial Data which appear elsewhere in this Annual Report.

         Professional Staff has grown from being a leading national provider of
temporary laboratory scientists and technicians in the United Kingdom into an
international specialty staffing services company providing temporary and
permanent placement services to the technology, science and management sectors
with operations in the UK, USA and Continental Europe. Since the Company's
initial public offering in August 1996, the Company has made seven acquisitions
which have increased the Company's range of specialty services, geographic
markets and industry sectors. The Company now derives more than 35% of revenue
from markets outside the United Kingdom and has temporary professionals working
in 25 different countries.

Acquisitions

         The businesses acquired in the year ended March 31, 1999 are described
below, together with a summary of the acquisition terms.

                                                                        Annual
                                                                      Revenue(1)
Date of Acquisition        Name                    Sectors           (millions)
-------------------        ----                    -------           -----------

July 1998                  EPL                     Technology        (pound)8.8m
October 1998               Praxis                  Management        (pound)4.4m
March 1999                 Euromedica              Science           (pound)2.3m
March 1999                 The Woolf Group         Science                $13.2m

(1)      Information derived from the audited financial statements for the
         twelve month periods ended December 31, 1997 for EPL, September 30,
         1998 for Praxis, March 31, 1999 for Euromedica and December 31, 1998
         for Woolf, the most recent audited periods available prior to each
         acquisition. These revenues may not be indicative of future revenues.

         EPL. On July 17, 1998 the Company acquired the entire issued share
capital of EPL Overseas Limited, a UK based provider of skilled contract
personnel to the European telecommunications industry. The initial purchase
price was (pound)1,650,000 in cash. Further cash consideration may become
payable dependent upon the gross profit of the group's technology businesses,
into which the acquired business was merged from January 1, 1999 to form the
S-Com EPL brand, for the period to July 2000. Ron Stewart, formerly Managing
Director and significant selling shareholder, was retained as Managing Director
of EPL and was subsequently appointed as Managing Director of S-Com EPL. The


                                       19

<PAGE>



acquisition of EPL, alongside the Company's existing S-Com business, strengthens
the Company's position as a leading player in worldwide telecommunications
staffing.

         Praxis. On October 1, 1998 the Company acquired the entire issued share
capital of Praxis Executive Taskforce Limited, a UK based provider of interim
executives and managers to industry and commerce. The initial purchase price was
(pound)2,525,000 in cash. Further cash consideration may become payable in
December 1999 and December 2000 dependent upon improvements to operating income
for the years ended September 30, 1999 and September 30, 2000. Mr. Carl Hague,
the majority selling shareholder, was retained as an executive officer of
Praxis. This acquisition, alongside the Company's existing Executives On
Assignment business, makes the Company the dominant provider of interim
executives in the UK.

         Euromedica. On March 26, 1999 the Company purchased the entire issued
share capital of Euromedica plc and 94% of the share capital of Euromedica
International Limited (together "Euromedica"). Euromedica is the largest
executive search firm in Europe in the pharmaceutical, bioscience and healthcare
sectors and has a network of offices in the UK, Belgium and Germany and
strategic partnerships in the US, India, France and Spain. The purchase price
was (pound)2,888,000.

         Woolf. On March 31, 1999 the Company purchased the entire issued share
capital of The Woolf Group, Inc., a US based provider of clinical trials
staffing services to pharmaceutical companies and contract research
organizations. The initial purchase price was (pound)9,560,000. Further cash
consideration may become payable in May 2000, May 2001 and May 2002 dependent
upon improvements to operating income for the years ended March 31, 2000, 2001
and 2002 and will be payable to the three selling principals all of whom remain
as executive officers of Woolf.

         The acquisitions of Woolf and Euromedica alongside the Company's
existing scientific staffing business, Lab Staff, and recruitment business ESCA,
provide a significant step toward the Company's development of a global
vertically integrated science staffing business.

Results of Operations - Years ended March 31, 1999 and 1998

         The following tables set forth the percentage relationship to revenue
of selected items:

<TABLE>
<CAPTION>
                                                              Fiscal Years Ended March 31,
                                                                 1999                 1998
                                                                 ----                 ----
<S>                                                            <C>                  <C>
Revenue                                                        100.0%               100.0%
Direct cost of revenue                                           77.8                 75.0

Gross profit                                                     22.2                 25.0
Selling, general and administrative expenses                     16.9                 16.6

Income from continuing operations before interest and tax         4.9                  8.1
Net income from continuing operations                             4.2                  5.9
</TABLE>


Revenue

         Revenue increased by 64% to (pound)95.4 million during the year ended
March 31, 1999 from (pound)58.3 million during the year ended March 31, 1998.
The increase in revenue was attributable to internal revenue growth of
approximately 18%, the full year effect of the of S-Com, SDS and Salisbury
acquisitions made in the year ended March 31, 1998, and the EPL and Praxis
acquisitions which added (pound)10.1 million of revenue in the periods from
acquisition to March 31, 1999. Internal revenue growth was primarily as a result
of growth in the number of billable hours, and to a lesser extent, increases in
bill rates.

                                       20

<PAGE>



         For the year ended March 31, 1999, revenue from services to the
technology sector contributed 68% (1998 - 52%) of total revenue, services to the
science sector contributed 26% (1998 - 39%) and services to the management
sector contributed 6% (1998 - 9%) of total revenue.

         As a percentage of total revenue for the year ended March 31, 1999,
temporary staffing represented 94.4%, permanent placement represented 3.6% and
other services accounted for 2.0%, as compared to 90.9%, 5.7% and 3.4%,
respectively. The increase in temporary staffing revenue principally was a
result of the full year year effect of the S-Com acquisition, the EPL and Praxis
acquisitions being predominantly temporary staffing businesses and, to a lesser
extent, a decrease in permanent placement revenues from the Salisbury
businesses.

         The Company now derives more than 35% of its revenue from markets
outside the United Kingdom. As S-Com EPL's international operations continue to
expand, particularly in the United States, and with the introduction of revenues
from the Woolf Group in the United States and Euromedica in Continental Europe,
the proportion of revenue derived by the Company from operations and markets
outside the United Kingdom is likely to increase.

Gross Profit

         The Company defines gross profit as total revenue less the direct cost
of providing workers for its clients, including wages, benefits, expenses and
allowances for temporary professionals, and fees for permanent placements less
the cost of direct research associated with those placements. Gross profit was
(pound)21.1 million and (pound)14.6 million during the years ended March 31,
1999 and 1998 respectively. Gross profit as a percentage of revenue was 22.2%
and 25.0% respectively. Lower gross margin percentages in 1999 resulted from the
increase in the proportion of revenues derived from temporary staffing compared
to permanent and other revenues and from higher rates of internal growth in the
lower margin technology staffing sector relative to the higher margin science
and interim management sectors. In 1999, 82% of the Company's gross profit was
derived from temporary staffing services compared to 71% in 1998. While the
composite gross profit margin for the Company has declined for the year ended
March 31, 1999 compared to the year ended March 31, 1998, the gross profit
margins within each of the Company's businesses have been maintained or
improved.

Selling, General and Administrative Expenses

         Selling, general and administrative expenses primarily comprise
compensation payable to employees, office rentals and other facility related
costs and marketing expenses. Selling, general and administrative expenses were
(pound)16.1 million and (pound)9.7 million for the years ended March 31, 1999
and 1998 respectively. As a percentage of revenue, selling, general and
administrative expenses were 16.9% and 16.6% respectively. Included in fiscal
1999 were unusual items totalling (pound)809,000 incurred in restructuring the
Company's Salisbury businesses, merging the S-Com and EPL businesses, aborting a
prospective acquisition and increasing provisions for collection costs of
certain receivables and general reserves against doubtful debts. Excluding these
unusual items, selling, general and administrative expenses would have fallen as
a percentage of revenue from 16.6% in fiscal 1998 to 16.0% in fiscal 1999.

Amortization of Goodwill

         The Company has goodwill arising from acquisitions that it is
amortizing over estimated useful lives of 30 years. Goodwill amortization was
(pound)375,000 for the year ended March 31, 1999 compared to (pound)193,000 for
the year ended March 31, 1998. The increase in amortization expense is due to
the full year effect of acquisitions made in the year ended March 31, 1998
together with acquisitions made in the year ended March 31, 1999. With
contingent consideration and the full year effect of acquisitions made in fiscal
1999, amortization expense will increase further in fiscal 2000.

Other Income/(Expense)

          Other income is comprised primarily of interest income, but also
includes interest expense and gains or losses on foreign currency translation
and totaled (pound)1,435,000 and (pound)410,000 for the years ended March 31,
1999 and 1998 respectively. The increase in 1999 was due to interest income from
the investment of the proceeds of the Company's secondary public offering
completed in May 1998.


                                       21

<PAGE>


Income Taxes

         The Company is subject to United Kingdom corporation tax at a statutory
rate of 31% (fiscal 1998: 31%) and, to a much lesser extent, to income taxes in
the United States and Germany. Income tax expense was provided for at effective
rates, excluding the non-deductibility of goodwill amortization expense, of
32.0% (fiscal 1998 - 32.0%) and totaled (pound)2.1 million and (pound)1.7
million respectively for the years ended March 31, 1999 and 1998. The effective
tax rate (excluding non-deductible goodwill amortization) is expected to remain
at between 31% and 32% despite a 1% cut in UK corporation tax which becomes
effective on 1 April 1999, as the Company experiences an increasing taxation
burden in the higher rate jurisdictions of the United States and Germany.

Operational Overview

         The Company's revenues are derived from amounts billed to clients for
temporary and permanent recruitment services. Amounts billed to clients for
temporary assignments include the workers' wages and benefits and the Company's
fees and billable expenses; fees depend on the number of billable hours worked,
as well as the skill and experience of the temporary worker. Temporary workers
are paid only when on assignment with a client. At the end of an assignment,
workers may be re-assigned to another client, permanently placed with the client
(for which a fee is generally payable) or retained on the Company's databases
pending further assignment.

         Amounts billed to clients for permanent recruitment services are
usually a percentage of the annual salary of the recruited worker. Fees are
payable for database and executive searches as well as temporary to permanent
conversions and range from 33% for an executive search to 15% for a database
search. Lower percentages may apply in certain circumstances, for multiple
appointments or for some temporary to permanent conversions. Some recruitment
assignments involve the design and insertion of media advertising, a cost which
is billed to clients. There are no on-going costs or benefits associated with
the recruited worker who, on appointment, becomes the sole responsibility of the
client. Consistent with industry practice, the Company offers a money-back
guarantee or a further search on a no-charge basis in the event that the worker
is found to be unsatisfactory after a limited number of weeks. This guarantee,
the duration of the "trial period" and the terms under which further work is
undertaken are all within industry standard procedures in the U.K. recruitment
market.

         Approximately 35% of the Company's billings were in currencies other
than the pound sterling for the year ended March 31, 1999. The Company's policy
is, wherever possible, to match the currency in which a temporary professional
is paid with the currency in which the client is billed. The Company is exposed
to exchange rate fluctuations between contractor payment date and client payment
date on transactions where currencies are matched and to transaction exposure on
the rare occasions where currencies are not matched. To date, management has
considered these risks to have limited impact and has not deemed it appropriate
to engage in any currency hedging activities other than passive use of
borrowings in foreign currency.

Results of Operations - Years ended March 31, 1998 and 1997

         The following tables set forth the percentage relationship to revenue
of the selected items:

<TABLE>
<CAPTION>
                                                                 Fiscal Years Ended March 31,
                                                                 ----------------------------
                                                                  1998                 1997
                                                                  ----                 ----
<S>                                                               <C>                  <C>
Revenue                                                           100.0%               100.0%
Direct cost of revenue                                             75.0                 69.3

Gross profit                                                       25.0                 30.7
Selling, general and administrative expenses                       16.6                 15.2

Income from continuing operations before interest and tax           8.1                 15.4
Net income from continuing operations                               5.9                 11.8
</TABLE>


                                       22

<PAGE>


Revenue

         Revenue increased by 197% to (pound)58.3 million during the year ended
March 31, 1998 from (pound)19.6 million during the year ended March 31, 1997.
The increase in revenue in 1998 was primarily attributable to the revenue
derived from the acquired operations of Salisbury, S-Com and SDS. Revenues,
excluding the acquired businesses, increased by 17.6% to (pound)23.1 million
from (pound)19.6 million during this period, primarily as a result of growth in
the number of billable hours, and to a lesser extent, increases in billable
rates. As a percentage of total revenue for the year ended March 31, 1998,
temporary staffing represented 90.9%, permanent placement represented 5.7% and
other services accounted for 3.4%, as compared to 97.2%, 2.8% and 0%,
respectively, during the prior year. The increase in permanent placement revenue
principally was a result of the acquisition of Salisbury and, to a lesser
extent, an increase in the number of permanent placements by Lab Staff during
fiscal 1998 compared to the prior year.

Gross Profit

         Gross profit was (pound)14.6 million and (pound)6.0 million during the
years ended March 31, 1998 and 1997 respectively. Gross profit as a percentage
of revenue was 25.0% and 30.7% respectively. Lower gross margin percentages in
1998 resulted from the increasing proportion of revenues derived from
acquisitions in the technology staffing sector, partially offset by an increase
in high margin permanent placement fees. Gross profit margins in the technology
sector are significantly lower than the Company's other businesses. While, as a
result of a change in the relative growth in different operating sectors, the
average gross profit margin for the Company declined for the year ended March
31, 1998 compared to the year ended March 31, 1997, the gross profit margins
within each of the Company's original businesses were maintained, and, on a pro
forma basis, gross margins of the acquired businesses were also maintained.

Selling, General and Administrative Expenses

         Selling, general and administrative expenses were (pound)9.7 million
and (pound)3.0 million for the years ended March 31, 1998 and 1997 respectively.
As a percentage of revenue, selling, general and administrative expenses were
16.6% and 15.2% respectively. The increase in 1998 in selling, general and
administrative expenses resulted from an increase in permanent placement
activities, which are characterized by higher selling, general and
administrative expenses, as a result of the Salisbury acquisition.

Amortization of Goodwill

         Goodwill arose in connection with the acquisitions during the year
ended March 31, 1998. Goodwill amortization was (pound)193,000 for the period.

Other Income/Expense

         Other income, primarily interest income, totaled (pound)410,000 and
(pound)550,000 for the years ended March 31, 1998 and 1997 respectively. The
decrease in 1998 was due to the investments made, including working capital, in
acquisitions.

Income Taxes

         The Company was subject to United Kingdom corporation tax at a
statutory rate of 31% (fiscal 1997: 33%). Income tax expense was provided for at
effective rates of 32.0% and 35.0% and totaled (pound)1.7 million and (pound)1.3
million for the years ended March 31, 1998 and 1997.

Liquidity and Capital Resources

         Cash used by operations was (pound)1.8 million in fiscal 1999 compared
to (pound)3.2 million in fiscal 1998. Cash was used primarily to fund working
capital requirements in the Company's growing technology business. Average days'
sales outstanding increased from 69 days at March 31, 1998 to 88 days at March
31, 1999 due to the increased proportion of monthly billed technology business
and increased incidence of international sales in that sector with

                                       23

<PAGE>


attendant collection issues. The Company's science and management businesses
continued to be cash generative from operations with no significant change in
average days' sales outstanding.

         The Company's principal source of cash in fiscal 1999 was provided by a
secondary offering of 3,052,500 ordinary shares completed in May 1998 which
provided (pound)28.8 million net of issue expenses. The principal source of cash
in fiscal 1998 was cash balances brought forward from fiscal 1997 which in turn
arose from the Company's initial public offering in August, 1996, which raised
(pound)8.4 million net of expenses for the Company, and cash generated from
operations in fiscal 1997 and prior periods.

         The principal use of cash in fiscal 1999 and fiscal 1998, other than
that used by operations, was in acquisitions. In fiscal 1999 the Company paid in
aggregate (pound)16.6 million in consideration for the four businesses acquired
in fiscal 1999 and (pound)3.2 million in consideration for businesses acquired
in fiscal 1998 upon the determination of contingencies. This amount included
final settlements in respect of Salisbury and SDS. The Company also used
(pound)4.0 million of cash to repurchase 762,000 Ordinary Shares. In fiscal 1998
the Company paid in aggregate (pound)6.6 million in consideration for the three
businesses acquired, Salisbury, S-Com and SDS.

         On March 31, 1999 the Company had cash balances of (pound)2.0 million.
The Company has available lines of credit of up to (pound)5 million under a
secured overdraft facility on which interest is payable at the rate of 1.15%
over base rate when drawn down. The payment of UK corporation tax converts to a
current period payment on account method for fiscal 2000 compared to annual
payment in arrears in fiscal 1999. Except for the payment of UK corporation tax,
management expects the Company to become cash neutral from operating activities
during fiscal 2000. Management expect the Company's cash balances, available
line of credit and borrowing capacity will be sufficient to fund the Company's
anticipated cash requirements for the next twelve to eighteen months which
principally comprise of contingent consideration for acquired businesses.
Management also believes the Company has sufficient borrowing capacity to
continue its acquisition strategy.

Year 2000 readiness disclosure

         The majority of the management, accounting and communication systems
used by the Company have been installed since 1996 and management believes that
such systems are Year 2000 compliant. The Company is in the process of achieving
full Year 2000 compliance. The Company's full range of electronic equipment
underwent testing during fiscal 1999. The Company has approached its principal
suppliers to confirm compliance of their computer software. A project team
headed by the Professional Staff Systems Manager has been established to ensure
that a fully co-ordinated program is implemented throughout the Company and full
compliance is expected to be confirmed by September 1999. Management does not
anticipate that the Company will incur significant operating expenses or be
required to invest heavily in computer systems improvements to be Year 2000
compliant, and does not anticipate that business operations will be disrupted or
that its customers will experience any interruption of service as a result of
the millennium change. However, any disruption or interruption arising from Year
2000 compliance problems could have a material adverse effect on the Company's
operating results and financial condition.

Impact of Inflation

         Management believes that over the past three years inflation has not
had a significant impact on the Company's results of operations.

Item 9A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Not applicable.


                                       24

<PAGE>



Item 10.  DIRECTORS AND OFFICERS OF REGISTRANT

Board of Directors

         The Directors and Executive Officers of the Company are:

<TABLE>
<CAPTION>
Name                                                    Age                Position
----                                                    ---                --------
<S>                                                     <C>   <C>
Board of Directors
   Benjamin P. Blackden(3)........................       53   Chairman and Group Managing Director
   Kevin A. Worrall(1)............................       46   Group Finance Director
   Bruce R. Culver(2)(3)..........................       53   Deputy Chairman and Non-Executive Director
   Jerry C. Benjamin(1)(2)........................       58   Non-Executive Director
   John C. Maynard(1)(2)..........................       66   Non-Executive Director
   Russell S. Reynolds, Jr.(2)(3).................       67   Non-Executive Director

Other Executive Officers
   Peter Lowman...................................       53   Managing Director, Science Recruitment Group
   Ronald L. Stewart..............................       52   Managing Director, S-Com EPL
   Robert C. Snell................................       55   Managing Director, Executives on Assignment
   Carl M. Hague..................................       54   Managing Director, Praxis Executive Taskforce
   Faye Woolf.....................................       38   Managing Director, The Woolf Group
   Peter Banks....................................       61   Chairman, Euromedica
   Peter Woods....................................       50   Managing Director, Euromedica
   Cathy M. Lasher................................       45   Company Secretary
</TABLE>
----------------
(1)   Member of the Audit Committee.
(2)   Member of the Compensation Committee.
(3)   Member of the Nominations Committee.

         Benjamin P. Blackden was co-founder of the Company and has been the
Company's Managing Director since 1990 and was appointed Chairman in January
1999. Prior to joining the Company, Mr. Blackden was President of a New
Jersey-based subsidiary of Fisons Instruments, a scientific instrument
manufacturer, and then Director of P-E International's Temporary Executive
Service, the original provider of interim management in the United Kingdom. He
previously held director level appointments in Human Resources at Fisons
Scientific Equipment and Avdel Ltd., following an earlier career with GEC.

         Kevin A. Worrall has served as Group Finance Director since September
1995 and was appointed to the Board in December 1995. Mr. Worrall was Director
of Corporate Development at Lease Plan UK Ltd, the U.K. leasing arm of the Dutch
Bank ABN AMRO from 1993 to 1995. Mr. Worrall served as Finance Director, Group
Treasurer and Business Development Director of several subsidiaries of PHH
Europe (now part of Cendant Corporation), a multinational vehicle leasing and
business services group, during his employment with PHH from 1979 to 1992. Mr.
Worrall holds an MBA with distinction from the University of Warwick and is a
member of the Association of Corporate Treasurers.

         Bruce R. Culver was co-founder of the Company and Chairman through
November 1995 and remains on the Board as Deputy Chairman and a Non-Executive
Director. In 1986 Mr. Culver founded Lab Support, Inc. in the U.S. (now called
On Assignment, Inc.). He was its Chief Executive, Chairman and Director until
1990. From 1984 to 1986, Mr. Culver was a management consultant to a number of
technology companies. Prior to 1984 he was Vice President of marketing for
Bausch & Lomb/ARL. Mr. Culver serves as a director of a number of other
companies in the U.S.

         Jerry C. Benjamin was a Non-Executive Director from the Company's
founding through October 1997, and was re-appointed to the Board in February
1998. Mr. Benjamin is also a director of Advent Limited, which he joined in 1988
where he is responsible for investments in the health care and biotechnology
sectors. From 1965 to 1988, Mr. Benjamin held a variety of executive positions
in Monsanto's Chemical and health care businesses, latterly as


                                       25

<PAGE>


Director of Corporate Venture Capital. Mr Benjamin is a director of Biomagnetic
Technologies, Inc., Orthofix International N.V. and a number of private
companies.

         John C. Maynard OBE was appointed a Non-Executive Director in January
1996. Dr. Maynard has had a distinguished career at Amersham International (now
Nycomed Amersham) where he has served as Director of Inorganic Research and
Radiopharmaceuticals, and subsequently Group Research & Development and
Operations Director. He retired from Amersham International in December 1996.
Dr. Maynard is Honorary Professor in the Department of Chemistry at the
University of Wales.

         Russell S. Reynolds, Jr. was appointed to the Board of Directors as a
Non-Executive Director in April 1996. Mr. Reynolds founded Russell Reynolds
Associates, Inc., a leading executive recruiting firm in 1969. He is a director
of a number of organizations including the Oppenheimer Fund. He is also
Chairman of Directorship, a Connecticut-based consultancy advising chairmen and
CEOs on a range of boardroom issues, including corporate governance, the
appointment of directors and compensation.

         Peter Lowman joined Professional Staff as Managing Director of the
Sciences Recruitment Group in June 1999. He founded a strategic and change
management consultancy in 1991 providing consulting in organizational change and
performance improvement to a range of blue chip clients. Prior to that, he spent
16 years in the recruitment industry in operational and marketing roles with
Manpower, as Operations Director with Reed Employment and as Chief Executive
with Alfred Marks. Earlier in his career he held sales positions with a number
of major companies. He started his career with Pfizer in the Process Development
Labs. He is a Fellow of the Institute of Management.

         Ronald L. Stewart founded EPL Overseas Limited in 1985 and is currently
Managing Director of S-Com EPL Limited. He has considerable business experience
in many parts of the world, particularly the Philippines and Hong Kong. Prior to
his business career he was in the British Army for 16 years retiring with the
rank of major.

         Robert C. Snell has been Managing Director of Executives on Assignment
since its formation in 1994. Previously, he had a two-year interim management
assignment with Nuclear Electric plc. From 1984 to 1989, he held various
positions at Saatchi & Saatchi plc, including General Manager, Consulting
Division and Director of Corporate Business Administration. From 1977 to 1984,
he was with Booz, Allen & Hamilton in Turin, Paris and London, where he became a
Vice President. He is a qualified Cost and Management Accountant.

         Carl M. Hague is Managing Director of Praxis Executive Taskforce. He
trained originally as a brewer and bio-chemist with Samuel Webster Limited. He
quickly moved to a management services position with Bass Mitchells and Butlers
Limited becoming deeply involved in post acquisition project work. From there he
transferred to HR undertaking increasingly senior strategic management rolls
with Bass plc. He founded Praxis in 1989.

         Faye Woolf had retail business interests before founding The Woolf
Company in 1992. Originally devoted to providing investigation, meeting and
planning services to the clinical trials industry, it was relaunched as The
Woolf Group in 1995 when Jean Hendrickson and Betsy Brown joined the business
and the services offered were extended to clinical trials staffing and permanent
placements.

         Peter Banks gained his PhD at Manchester University Institute of
Science and Technology. He worked in R&D and management positions with CIBA in
the UK, then spent many years in the Netherlands as Global Head of Purchasing
and Supply of semi-finished and finished products. He worked as a consultant
with Grosvenor Stewart in Brussels before co-founding Euromedica in 1987.

         Dr. Peter Woods is Managing Director of Euromedica. A graduate in
Physiology and Biochemistry he also qualified as a doctor at Westminster Medical
School. After practicing medicine for some years he began his business career at
Smith & Nephew and has had senior appointments at BZW (healthcare research),
Fisons (corporate affiars) and Williams De Broe. He joined Euromedica in January
1997.

         Cathy M. Lasher was appointed Company Secretary in May 1997. Ms. Lasher
has spent her career in the private sector service industry, including three
years as company secretary of a management consulting company listed on the
London Stock Exchange. Ms. Lasher spent nine years with a major international
accounting firm after


                                       26

<PAGE>


qualifying as an accountant in the United States and as an ACA in the United
Kingdom. Ms. Lasher holds an MBA from the Wharton School of Business.

         At each annual general meeting of shareholders, one-third of the
Company's directors (or the whole number nearest to but lower than one-third)
must retire from office by rotation, provided that no director holding office as
Chief Executive or Managing Director shall be subject to retirement by rotation.
The directors to retire by rotation shall be those who have been longest in
office since their last re-election and so that as between persons who became or
were last re-elected directors on the same day, those to retire shall (unless
they otherwise agree among themselves) be determined by lot. Accordingly, at the
annual general meeting of the Company to be held in September 1999, it is
anticipated that John C. Maynard will retire and offer himself for re-election,
subject to him being a director at the relevant time.

         The Board of Directors may delegate any of its powers, authorities or
discretions (with the power to sub-delegate) to any committee consisting of such
person or persons as it thinks fit, provided that the majority of the members of
any such committee consists of directors of the Company. The Board of Directors
has established an audit committee, a compensation committee and a nominations
committee.

Item 11.  COMPENSATION OF DIRECTORS AND OFFICERS

         The Company paid its Board of Directors as a group (6 persons)
(pound)307,000 (of which (pound)138,000 is paid to the highest-compensated
director) for the year ended March 31, 1999 of which (pound)12,000 represented
pension contributions. The Company currently contributes to third-party personal
pension plans of directors to a maximum of 5% of salary, so long as each such
director matches such amount.

Employment Agreements

         Each of the Company's directors and executive officers has entered into
an employment agreement with the Company providing, among other things, that
each of the executive officers will provide services to Professional Staff or
its subsidiaries, as the case may be, on substantially a full-time basis. The
contracts also contain non-compete provisions which restrict the executive
officers from being involved in, for the period of their employment and for up
to one year thereafter, any business which engages in the business of
recruitment and/or provision of temporary or permanent staff in the Science,
Technology or Management sectors, as appropriate, and which is a competitor of
the Company.

Item 12.  OPTIONS TO PURCHASE SECURITIES FROM REGISTRANT OR SUBSIDIARIES

         The Company has two employee share option plans, the Professional Staff
Employee Share Plan (the "1992 Approved Option Plan") and the 1996 Professional
Staff Company Share Option Plan (the "1996 Option Plan").

1992 Approved Option Plan

         All of the options under the 1992 Approved Option Plan were granted
between March 6, 1992 and April 26, 1996. The 1992 Approved Option Plan is
approved by the Inland Revenue.

         Options granted under the 1992 Approved Option Plan entitle
participants to subscribe for Ordinary Shares at an exercise price which is not
less than the market value of an Ordinary Share at the date of grant as
determined by the Board and agreed with the Inland Revenue. Options are
non-transferable, except in the case of death of a participant, in which case
the personal representatives are entitled to exercise such option within 12
months of the participant's death. Options granted under the 1992 Approved
Option Plan are normally exercisable between three and ten years after the date
of grant. Options generally expire on the termination of employment of the
participant other than by reason of injury, disability, pregnancy, retirement or
the sale of the business or subsidiary for which the participant works. In those
circumstances the participant may exercise all options generally within a 6
month period after the third anniversary of the date of grant. If the
participant's employment terminates by reason of redundancy or resignation,
options may be exercised in accordance with a vesting schedule as follows.
Options lapse if the redundancy or resignation takes place within 12 months of
the date of grant. Thereafter, 25% of the Ordinary Shares under option may be
exercised if the redundancy or resignation occurs more than 12 but less than 13
months


                                       27

<PAGE>


from the date of grant with an additional 3.125% becoming exercisable for
each complete month of employment over 13 but less than 36 months from the date
of grant. Exercise is allowed in the event of an amalgamation, re-construction
or takeover of the Company; alternatively, options may, with the agreement of
the acquiring company, be exchanged for options over shares in the acquiring
company or a company associated with the acquiring company. In the event of any
increase or variation in the issued ordinary share capital of the Company by way
of re-capitalization or otherwise, the number of Ordinary Shares subject to any
option and the price payable upon the exercise of any option may be adjusted by
the Board provided that the adjustment is fair and reasonable and subject to the
prior approval of the Inland Revenue.

          As of July 24, 1999, options to acquire a total of 263,445 Ordinary
Shares were outstanding under the 1992 Approved Option Plan. Such options have
exercise prices ranging from (pound)0.25 to (pound)1.40 per Ordinary Share and
exercise periods which expire between April 2004 and April 2006.

1996 Option Plan

          The 1996 Option Plan comprises two parts, Part A, which has been
approved by the Inland Revenue and Part B, which, not being eligible, will not
be so approved.

          Other than as set out below, the terms of Part A of the 1996 Option
Plan are in all material respects identical to those of the 1992 Approved Option
Plan. The market value of an Ordinary Share at the date of grant will generally
be the NASDAQ market value (as agreed with the Inland Revenue). Each
individual's participation will be limited so that the aggregate market value
(as at their relevant dates of grant) of Ordinary Shares under Part A of the
1996 Option Plan and under any other approved discretionary share plan
established by the Company (including the 1992 Approved Option Plan), in any ten
year period will not exceed (pound)30,000.

          The exercise of options granted under Part A of the Option Plan may be
made subject to the attainment of objective performance targets set by the
Compensation Committee of the Board of Directors at the date of grant linked to
the underlying performance of the Company.

          As to the exercise of options, the vesting schedule referred to above
in respect of the 1992 Approved Option Plan will apply to termination of
employment of the participant by reason of death, injury, disability, pregnancy,
redundancy, retirement, the sale of the business or subsidiary for which the
employee works or (at the discretion of the Compensation Committee) if the
employee ceases to be employed in any other circumstances. Options will lapse if
a participant ceases employment otherwise than in the circumstances referred to
above.

          As of July 24, 1999, options to acquire a total of 341,100 Ordinary
Shares were outstanding under Part A of the 1996 Option Plan. Such options have
exercise prices ranging from $6.625 to $16.875 per Ordinary Share and exercise
periods which expire between April 2007 and June 2009. Options to acquire a
total of 5,050 Ordinary Shares are held by certain directors of the Company.

          Other than as set out below, the terms of Part B of the 1996 Option
Plan are in all material respects identical to those of Part A of the 1996
Option Plan. If options are not exercised within seven years of their grant,
they will generally lapse. Each individual's participation will be limited so
that the aggregate market value (as at their relevant dates of grant) of Shares
under option under Part B of the 1996 Option Plan and under any other
discretionary share plan established by the Company, excluding options granted
under the 1992 Approved Option Plan and non-approved option arrangements, in any
10 year period will not exceed four times the annual remuneration of such
individual or (pound)100,000, if greater (excluding options which have been
exercised).

          As of July 24, 1999, options to acquire a total of 967,618 Ordinary
Shares were outstanding under Part B of the 1996 Option Plan. Such options have
exercise prices ranging from $6.625 to $16.875 per Ordinary Share and exercise
periods which expire between April 2004 and June 2006. Options to acquire
254,950 Ordinary Shares are held by certain directors of the Company.

                                       28

<PAGE>


Grants of Non-Approved Options

          In addition to the options granted under the 1992 Approved Option Plan
and options granted under the 1996 Option Plan, the Company granted certain
employees and directors non-approved options to purchase Ordinary Shares in the
Company by deed.

          As of July 24, 1999, options to acquire a total of 188,040 Ordinary
Shares were outstanding. Such options have exercise prices ranging from
(pound)1.25 to $16.875 per Ordinary Share and exercise periods which will expire
between October 2002 and May 2005. Non-approved options to acquire a total of
80,000 Ordinary Shares are held by certain directors of the Company.

Item 13.  INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS

Not applicable.


                                     PART II

Item 14.  DESCRIPTION OF SECURITIES TO BE REGISTERED

Not applicable.

                                    PART III

Item 15.  DEFAULTS UPON SENIOR SECURITIES

None.

Item 16.  CHANGES IN SECURITIES AND CHANGES IN SECURITY FOR
                 REGISTERED SECURITIES

None.

                                     PART IV

Item 17.  FINANCIAL STATEMENTS

Not applicable.


Item 18.  FINANCIAL STATEMENTS

See pages F-1 through F-17.

Item 19.  FINANCIAL STATEMENTS AND EXHIBITS

(a)       Financial Statements

          The following financial statements together with the report of
Deloitte & Touche thereon are filed as part of this Annual Report:
                                                                           Page
          Report of Independent Auditors .................................  F-1
          Consolidated Statements of Income and Comprehensive Income .....  F-2
          Consolidated Balance Sheets ....................................  F-3
          Consolidated Statements of Shareholders' Equity ................  F-5

                                       29

<PAGE>





          Consolidated Statements of Cash Flows ..........................  F-6
          Notes to the Financial Statements ..............................  F-8

(b)       Exhibits

          None.






                                       30

<PAGE>



                                   SIGNATURES

          Pursuant to the requirements of Section 12 of the Securities and
Exchange Act 1934, the registrant certifies that it meets all of the
requirements for filing on Form 20-F and has duly caused this Annual Report to
be signed on its behalf by the undersigned, thereunto duly authorized.




                                    PROFESSIONAL STAFF PLC



                                    By: /s/ Kevin Worrall
                                        ------------------------------------
                                            Kevin Worrall
                                        Group Finance Director





Date: July  ____, 1999










<PAGE>

REPORT OF INDEPENDENT AUDITORS


The Board of Directors and Shareholders of

Professional Staff plc
Slough, England



We have audited the accompanying consolidated balance sheets of Professional
Staff plc and subsidiaries as of March 31, 1999 and 1998, and the related
consolidated statements of income, comprehensive income, shareholders' equity
and cash flows for each of the three years in the period ended March 31, 1999.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing standards
in the United Kingdom which are similar to those in the United States of
America. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Professional Staff plc and
subsidiaries at March 31, 1999 and 1998, and the results of their operations and
cash flows for each of the three years in the period ended March 31, 1999 in
conformity with generally accepted accounting principles of the United States of
America.





DELOITTE & TOUCHE

Chartered Accountants

Bracknell, England

May 4, 1999






                                       F-1

<PAGE>

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
Years ended March 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
                                                                     Note                   1999            1998            1997
                                                                                     (pound)'000     (pound)'000     (pound)'000
<S>                                                                  <C>                  <C>             <C>             <C>
Revenue                                                                                   95,359          58,313          19,666

Direct cost of revenue                                                                    74,210          43,715          13,636
                                                                                    ------------     -----------    ------------

Gross profit                                                                              21,149          14,598           6,030


Selling, general and administrative expenses                          10                  16,076           9,660           2,998

Amortization of goodwill                                                                     375             193               -
                                                                                    ------------     -----------    ------------


Income from continuing operations before other
     income/(expense) and income taxes                                                     4,698           4,745           3,032


Other income/(expense)
        Interest and other income                                                          1,521             474             572
        Interest and other expense                                                           (86)            (64)            (22)
                                                                                    ------------     -----------    ------------


Income from continuing operations before
    income taxes                                                                           6,133           5,155           3,582


Income taxes                                                            7                  2,084           1,711           1,253
                                                                                    ------------     -----------    ------------


Income from continuing operations                                                          4,049           3,444           2,329


Discontinued operations
        Loss on disposal of discontinued operations (net of tax)                               -               -            (149)
                                                                                    ------------     -----------    ------------

Net income                                                                                 4,049           3,444           2,180
                                                                                    ============     ===========    ============


EARNINGS PER SHARE DATA                                                 3

Basic earnings per share:

        Income from continuing operations                                           (pound)0.45      (pound)0.59     (pound)0.47
                                                                                   ============      ===========    ============

        Loss on disposal of discontinued operations                                    (pound)-         (pound)-    (pound)(0.03)
                                                                                   ============      ===========    ============

        Net income                                                                  (pound)0.45      (pound)0.59     (pound)0.44
                                                                                   ============      ===========    ============

Diluted earnings per share:

        Income from continuing operations                                           (pound)0.43      (pound)0.51     (pound)0.40
                                                                                   ============      ===========    ============

        Loss on disposal of discontinued operations                                    (pound)-         (pound)-     pound)(0.02)
                                                                                   ============      ===========    ============

        Net income                                                                  (pound)0.43      (pound)0.51     (pound)0.38
                                                                                   ============      ===========    ============

COMPREHENSIVE INCOME, NET OF TAX                                                    (pound)'000      (pound)'000     (pound)'000

        Net income                                                                        4,049            3,444           2,180
        Foreign currency translation adjustment                                               -                -             149
                                                                                    ------------     -----------    ------------

        Comprehensive income                                                              4,049            3,444           2,329
                                                                                   ============      ===========    ============
</TABLE>

See notes to consolidated financial statements.

                                       F-2
<PAGE>




CONSOLIDATED BALANCE SHEETS
March 31, 1999 and 1998


<TABLE>
<CAPTION>
                                                                          Note                  1999          1998
                                                                                         (pound)'000   (pound)'000

ASSETS

<S>                                                                                          <C>           <C>
Current assets
        Cash and cash equivalents                                                              2,032         1,040
        Accounts receivable (less allowance for doubtful
        debts of(pound)790,000 in 1999 and(pound)179,000 in
        1998)                                                                                 25,010        14,059
        Unbilled receivables                                                                   2,126         1,061
        Prepaid expenses                                                                         537           332
        Other receivables                                                                      1,182           133
                                                                                           ---------      --------

 Total current assets                                                                         30,887        16,625

Property and equipment, net                                                  4                 3,326         2,689
Goodwill (less accumulated amortisation of(pound)568,000 in
1999 and(pound)193,000 in 1998)                                                               28,552         7,265
Other assets                                                                                       2             2
                                                                                           ---------      --------

TOTAL ASSETS                                                                                  62,767        26,581
                                                                                           =========     =========
</TABLE>


See notes to consolidated financial statements.



                                       F-3

<PAGE>




CONSOLIDATED BALANCE SHEETS
March 31, 1999 and 1998


<TABLE>
<CAPTION>

                                                                          Note                  1999          1998
                                                                                         (pound)'000   (pound)'000

LIABILITIES AND SHAREHOLDERS'
EQUITY
<S>                                                                                          <C>           <C>
Current liabilities
        Accounts payable                                                                      2,154         3,205
        Accrued liabilities                                                                   5,058         1,978
        Income tax payable                                                                    2,266         1,637
        Other taxes and social security payable                                               2,098         1,423
        Current portion of capital lease obligations                                             93           163
        Other liabilities                                                                     1,026         1,175
                                                                                          ---------      --------

Total current liabilities                                                                    12,695         9,581

Long term liabilities
        Capital lease obligations                                                                69             -
                                                                                          ---------      --------

                                                                                             12,764         9,581


Commitments and contingencies                                             2, 9                3,950             -
                                                                                          ---------      --------


Shareholders' equity
        Ordinary shares, 2p par value:
        Authorised shares - 24,000,000 in 1999
        and 1998
        Issued shares - 8,496,353 in 1999 and
        5,924,121 in 1998                                                                       170           118
        Additional paid-in capital                                                           37,706         8,782
        Capital redemption reserve                                                               16             1
        Retained earnings                                                                     8,161         8,099
                                                                                          ---------      --------

 Total shareholders' equity                                                                  46,053        17,000
                                                                                          ---------      --------

TOTAL LIABILITIES AND
   SHAREHOLDERS' EQUITY                                                                      62,767        26,581
                                                                                          =========      ========


</TABLE>

See notes to consolidated financial statements.


                                       F-4

<PAGE>




CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                                                                  Convertible     Additional       Capital
                                                        Ordinary      Ordinary      preferred        paid-in    redemption
                                                          shares        Shares         shares        capital       reserve
                                                         No.'000   (pound)'000    (pound)'000    (pound)'000   (pound)'000

<S>                                                        <C>             <C>          <C>            <C>             <C>
BALANCE AT APRIL 1, 1996                                   1,758            35            375             38             1
Conversion of preferred shares                             1,875            38          (375)            337             -
Ordinary share options exercised                             500            10              -             28             -
Ordinary shares issued, net of issue costs of
(pound)1,311,000                                           1,675            33              -          8,341             -
Net income                                                     -             -              -              -             -
                                                    ------------  ------------   ------------   ------------  ------------

BALANCE AT MARCH 31, 1997                                  5,808           116              -          8,744             1
Ordinary share options exercised                             116             2              -             38             -
Net income                                                     -             -              -              -             -
                                                    ------------  ------------   ------------   ------------  ------------

BALANCE AT MARCH 31, 1998                                  5,924           118              -          8,782             1
Ordinary shares issued, net of issue costs of              3,052            61              -         28,717             -
(pound)2,588,000
Ordinary share options exercised                             282             6              -            207             -
Ordinary shares repurchased                                (762)          (15)              -              -            15
Net income                                                     -             -              -              -             -
                                                    ------------  ------------   ------------   ------------  ------------

BALANCE AT MARCH 31, 1999                                  8,496           170              -         37,706            16
                                                    ============  ============   ============   ============  ============
</TABLE>


<TABLE>
<CAPTION>

                                                      Cumulative
                                                     translation       Retained
                                                      adjustment       earnings         Total
                                                     (pound)'000    (pound)'000   (pound)'000

<S>                                                        <C>            <C>           <C>
BALANCE AT APRIL 1, 1996                                   (149)          2,475         2,775
Conversion of preferred shares                                 -              -             -
Ordinary share options exercised                               -              -            38
Ordinary shares issued, net of issue costs of
(pound)1,311,000                                               -              -         8,374
Net income                                                   149          2,180         2,329
                                                    ------------    -----------    ----------

BALANCE AT MARCH 31, 1997                                      -          4,655        13,516
Ordinary share options exercised                               -              -            40
Net income                                                     -          3,444         3,444
                                                    ------------    -----------    ----------

BALANCE AT MARCH 31, 1998                                      -          8,099        17,000
Ordinary shares issued, net of issue costs of                  -              -        28,778
(pound)2,588,000
Ordinary share options exercised                               -              -           213
Ordinary shares repurchased                                    -         (3,987)       (3,987)
Net income                                                     -          4,049         4,049
                                                    ------------    -----------   -----------

BALANCE AT MARCH 31, 1999                                      -          8,161        46,053
                                                    ============    ===========    ==========

</TABLE>


See notes to consolidated financial statements.


                                       F-5

<PAGE>



CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended March 31, 1999, 1998 and 1997

<TABLE>
<CAPTION>
                                                                                        1999           1998           1997
                                                                                 (pound)'000    (pound)'000    (pound)'000
CASH FLOWS FROM OPERATING ACTIVITIES

<S>                                                                                   <C>           <C>             <C>
Net income                                                                              4,049         3,444          2,180

Adjustments to reconcile net income to net cash provided by operating
    activities:

Depreciation and amortization                                                           1,476           856            199

Profit on disposal of property and equipment                                              (40)          (26)            (9)

Loss on disposal of discontinued operations                                                 -             -            149

Changes in assets and liabilities, net of effects of acquisitions

        Accounts receivable                                                            (6,080)       (9,645)          (431)
        Unbilled receivables                                                             (812)         (785)          (276)
        Prepaid expenses                                                                  (44)         (135)            78
        Other receivables                                                                (970)          (32)           (77)
        Net assets of discontinued operations                                               -             -            200
        Accounts payable                                                               (1,659)        2,459             31
        Accrued liabilities                                                             1,771           274             46
        Income taxes payable                                                              460           307            286
        Other taxes and social security payable                                           308           (12)           208
        Other liabilities                                                                (290)           64            447
        Other long term liabilities                                                        -              -           (495)
                                                                                   ----------    ----------     ----------


Net cash (used by) provided by operating activities:                                   (1,831)       (3,231)         2,536
                                                                                   ----------    ----------     ----------


CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment                                                     (1,419)         (950)          (431)
Proceeds from sale of property and equipment                                              170           219             29
Acquisition of businesses, net of cash acquired                                       (20,789)       (6,984)             -
                                                                                   ----------    ----------     ----------



Net cash (used in) investing activities                                               (22,038)       (7,715)          (402)
                                                                                   ----------     ----------    ----------



CASH FLOWS FROM FINANCING ACTIVITIES
Ordinary share options exercised                                                          213            40             38
Ordinary share issuance                                                                28,778             -          8,374
Repurchase of ordinary shares                                                          (3,987)            -              -
Mortgage repayments                                                                         -          (460)           (60)
Payments under capital lease obligations                                                 (143)         (465)           (36)
                                                                                   ----------     ----------    ----------


Net cash provided by (used in) financing activities                                    24,861          (885)         8,316
                                                                                   ----------     ----------    ----------


NET INCREASE/(DECREASE) IN CASH AND CASH
   EQUIVALENTS                                                                            992       (11,831)        10,450


CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                            1,040        12,871          2,421
                                                                                   ----------     ----------    ----------



CASH AND CASH EQUIVALENTS, END OF YEAR                                                  2,032         1,040         12,871
                                                                                   ==========     =========     ==========
</TABLE>

See notes to consolidated financial statements.

                                       F-6
<PAGE>



CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended March 31, 1999, 1998 and 1997

<TABLE>
<CAPTION>
SUPPLEMENTAL DISCLOSURE OF CASH FLOW                                                    1999           1998           1997
    INFORMATION                                                                  (pound)'000    (pound)'000    (pound)'000

<S>                                                                                   <C>              <C>            <C>
Interest paid                                                                             86             22             22
                                                                                  ==========     ==========     ==========



Income taxes paid                                                                      1,624            967            634
                                                                                   =========     ==========     ==========
</TABLE>




                                       F-7

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

1.      BASIS FOR PRESENTATION OF THE FINANCIAL STATEMENTS AND SIGNIFICANT
        ACCOUNTING POLICIES

        BASIS OF PRESENTATION OF THE FINANCIAL STATEMENTS

        Nature of business

        Professional Staff plc and its subsidiaries (the "Company") primarily
        operate in niche sectors of the temporary staffing industry and other
        recruitment services in the United Kingdom, United States of America and
        Western Europe.

        Basis for consolidation

        The consolidated financial statements include the financial statements
        of Professional Staff plc and all of its subsidiaries. Professional
        Staff plc and its major subsidiaries are incorporated in Great Britain
        except for The Woolf Group, Inc. and S-Com Computer Systems Engineers,
        Inc. which are incorporated in the United States of America and S-Com
        Computer Systems Engineers GmbH which is incorporated in Germany. All
        significant intercompany transactions, profits and balances have been
        eliminated in consolidation.

        Use of estimates

        The preparation of financial statements in conformity with generally
        accepted accounting principles requires management to make estimates and
        assumptions that affect the amounts reported in the consolidated
        financial statements and accompanying notes. Actual results could differ
        from those estimates.

        Currency

        These consolidated financial statements are stated in United Kingdom
        pounds sterling.

        SIGNIFICANT ACCOUNTING POLICIES

        Cash and cash equivalents

        The Company considers all highly liquid investments with maturity of
        three months or less when purchased to be cash equivalents.

        Property and equipment

        Property and equipment is stated at cost and depreciated using the
        straight-line method. Freehold land is not depreciated, freehold
        buildings are depreciated over an estimated useful life of 40 years,
        fixtures, fittings and equipment are depreciated over estimated useful
        lives ranging from 3 to 10 years and motor vehicles are depreciated over
        an estimated useful life of 4 years.

        Goodwill

        Goodwill arising on the acquisition of a business is calculated by
        comparing the cost of the acquisition with the fair value of the net
        assets acquired. Any difference is treated as purchased goodwill and is
        amortised in equal amounts over its expected useful life. The
        amortisation period is assessed separately for each acquisition and the
        carrying value of goodwill and the adequacy of the amortisation rates
        are reviewed at each balance sheet date. All goodwill arising on
        acquisitions to date is being amortised over 30 years.


                                       F-8

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

1.      BASIS FOR PRESENTATION OF THE FINANCIAL STATEMENTS AND SIGNIFICANT
        ACCOUNTING POLICIES (continued)

        Impairment of long-lived assets

        Management assesses the recoverability of its long-lived assets by
        determining whether the amortisation of the asset's balance over its
        remaining life can be recovered through projected discounted future cash
        flows from operations. Management continually evaluates the existence of
        potential impairment by analysing operating results, trends and
        prospects. Management also takes into consideration any other events or
        circumstances that might indicate potential impairment. Based upon these
        evaluations, the Company has determined that no impairment of recorded
        long-lived assets has occurred.

        Fair values of financial instruments

        The carrying value of cash and cash equivalents, accounts receivable and
        accounts payable approximate to fair value due to the short maturities
        of such instruments.

        Revenue recognition

        The Company derives most of its revenues from supplying temporary
        staffing services. Revenues are recorded as such services are provided.

        Direct cost of revenue

        Direct cost of revenue consists primarily of compensation payable to
        temporary workers, related payroll taxes and direct expenses billable to
        clients. Direct cost of revenue does not include an allocation of
        overhead costs.

        Income taxes

        The Company uses the liability method of accounting for income taxes in
        accordance with Statement of Financial Accounting Standards ("SFAS") No.
        109 "Accounting for Income Taxes". Under this method, deferred tax
        assets and liabilities are determined based on differences between
        financial reporting and tax bases of assets and liabilities and are
        measured using the enacted tax rates and laws that will be in effect
        when the differences are expected to reverse.

        Earnings per share

        Basic earnings per share is computed on the weighted average number of
        ordinary shares outstanding during the respective period. Diluted
        earnings per share includes the effect of dilutive ordinary share
        equivalents outstanding during the periods using the treasury stock
        method.

        Share options granted to employees

        The Company accounts for all share-based compensation plans under the
        intrinsic value method prescribed by APB Opinion No.25, "Accounting for
        Stock Issued to Employees".



                                       F-9

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

1.      BASIS FOR PRESENTATION OF THE FINANCIAL STATEMENTS AND SIGNIFICANT
        ACCOUNTING POLICIES (continued)

        Foreign exchange

        The Company's reporting and functional currency is pounds sterling.
        Transactions of the Company denominated in foreign currencies are
        translated into functional currencies at the rates of exchange ruling at
        the date of transactions. Monetary assets and liabilities in foreign
        currencies at the balance sheet date are translated into functional
        currencies at the rates of exchange ruling at that date. Any differences
        are dealt with in the income statement.

        The balance sheets of foreign subsidiaries are translated into sterling
        at the closing rates of exchange and the profit and loss account at an
        average rate. The differences arising from the translation are charged
        directly to equity.

        Leases

        Assets held under finance leases are capitalised at their fair value on
        the inception of the lease and depreciated over their estimated useful
        lives. Finance charges are allocated over the period of the lease in
        proportion to the capital amount outstanding. Rentals under operating
        leases are charged to the income statement in equal annual amounts over
        the lease term.

2.      ACQUISITIONS

        On July 17, 1998 the Company acquired the entire issued share capital of
        EPL Overseas Limited ("EPL"), a UK based provider of skilled contract
        personnel to the European telecommunications industry. The initial
        purchase price was (pound)1,650,000 in cash. Further cash consideration
        may become payable dependent upon the gross profit of the group's
        technology businesses, into which the acquired business has been merged,
        for the period from October 1998 to July 2000. Such payments are due in
        May 1999, May 2000 and August 2000.

        On October 1, 1998 the Company acquired the entire issued share capital
        of Praxis Executive Taskforce Limited ("Praxis"), a UK based provider of
        interim executives and managers to industry and commerce. The initial
        purchase price was (pound)2,525,000 in cash. Further cash consideration
        may become payable in December 1999 and December 2000 dependent upon
        improvements to operating income for the years ended September 30, 1999
        and September 30, 2000.

        On March 26, 1999 the Company purchased the entire issued share capital
        of Euromedica plc and 94% of the share capital of Euromedica
        International Limited (together "Euromedica"). Euromedica is the largest
        executive search firm in Europe in the pharmaceutical, bioscience and
        healthcare sectors and has a network of offices in the UK, Belgium and
        Germany. The purchase price was (pound)2,888,000.

        On March 31, 1999 the Company purchased the entire issued share capital
        of The Woolf Group, Inc. ("Woolf"), a US based provider of clinical
        trials staffing services to pharmaceutical companies and contract
        research organisations. The initial purchase price was (pound)9,560,000.
        Further cash consideration may become payable in May 2000, May 2001 and
        May 2002 dependent upon improvements to operating income for the years
        ended March 31, 2000, 2001 and 2002.

        All acquisitions were accounted for by the purchase method and,
        accordingly, the purchase price (including transaction costs) was
        allocated among the identifiable tangible assets acquired and
        liabilities assumed based on their respective fair market values. The
        fair values allocated were approximately (pound)6,409,000 for the assets
        acquired and approximately (pound)4,084,000 for the liabilities assumed.
        The excess of purchase price over these

                                      F-10

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

2.      ACQUISITIONS (CONTINUED)

        estimated fair values of the net assets acquired was approximately
        (pound)14,551,000 and was recorded as goodwill which is being amortised
        using the straight line method over 30 years. The results of acquired
        operations have been included in the consolidated income statement from
        the respective dates of acquisition.

        The following unaudited consolidated pro-forma results of operations for
        the years ended March 31, 1999 and 1998 assume that all acquisitions
        made in the years ended March 31, 1999 and 1998 occurred as of April 1,
        1997:


                                                           1999           1998
                                                    (pound)'000    (pound)'000

         Revenue                                        111,984         89,431
                                                    ===========     ==========

         Net income                                       4,431          2,531
                                                    ===========     ==========

         Earnings per share:
                Basic                               (pound)0.50    (pound)0.43
                                                    ===========     ==========

                Diluted
                                                    (pound)0.47    (pound)0.37
                                                    ===========     ==========


        Such pro-forma amounts are not necessarily indicative of what the actual
        consolidated results of operations might have been if the acquisitions
        had been effective at the beginning of the periods.

        Contingent Consideration

        Prior year acquisitions

        Further cash consideration may become payable in August 1999 and August
        2000 in respect of the acquisition of S-Com Computer Systems Engineers
        Limited, acquired in the year ended March 31, 1998, dependent upon the
        gross profit of the group's technology businesses for the period to July
        2000.

        Recognition of contingent consideration

        Contingent consideration is recognised when the outcome of the
        contingency is beyond reasonable doubt. Accordingly, contingent
        consideration of (pound)3.95m has been recognised as at March 31, 1999.
        Where the outcome of the contingency is not beyond reasonable doubt, due
        to the complexity of the earnout formulae or uncertainty as to future
        performance, no liability has been recognised. Management do not
        anticipate that the aggregate of such unrecognised contingent
        consideration will exceed (pound)20m.

3.      EARNINGS PER SHARE

        The following table summarises the computations of share amounts used in
        the computation of earnings per share presented in the accompanying
        income statements.



                                      F-11

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

3.      EARNINGS PER SHARE (CONTINUED)

<TABLE>
<CAPTION>

                                                                              1999           1998          1997
                                                                              '000           '000          '000
<S>                                                                    <C>           <C>            <C>
        Basic earnings per share:
        Weighted average number of ordinary shares
        outstanding during the period                                        8,929         5,864          4,968
                                                                       ===========    ==========     ==========

        Diluted earnings per share:

        Weighted average number of ordinary shares
        outstanding during the period                                        8,929         5,864          4,968

        Dilutive effect of options                                             452           923            753
        Assumed conversion convertible preferred shares                          -             -            118
                                                                       -----------    ----------     ----------

        Total fully diluted securities considered outstanding
        during the year                                                      9,381         6,787          5,839
                                                                       ===========    ==========     ==========



                                                                       (pound)'000   (pound)'000    (pound)'000



         Net income                                                          4,049         3,444          2,180
                                                                       ===========    ==========     ==========

         Basic earnings per share                                      (pound)0.45   (pound)0.59    (pound)0.44
                                                                       ===========    ==========     ==========

         Diluted earnings per share                                    (pound)0.43   (pound)0.51    (pound)0.38
                                                                       ===========    ==========     ==========
</TABLE>

        Options to purchase 501,000 shares at exercise prices ranging from
        $11.50 to $16.875 were outstanding at March 31, 1999 but have not been
        included in the calculation of diluted earnings per share because the
        exercise prices were greater than the average market price of the
        ordinary shares.

4.      PROPERTY AND EQUIPMENT

<TABLE>
<CAPTION>
                                                                            1999          1998
                                                                     (pound)'000   (pound)'000

<S>                                                                      <C>           <C>
        Freehold land and buildings                                        1,018         1,041
        Motor vehicles                                                     1,507         1,053
        Fixtures, fittings and equipment                                   3,173         1,685
                                                                       ---------     ---------

                                                                           5,698         3,779
        Less: accumulated depreciation                                   (2,372)       (1,090)
                                                                       ---------     ---------

        Property and equipment, net of accumulated
           depreciation                                                    3,326         2,689
                                                                       =========     =========
</TABLE>

        The Company leases motor vehicles under capital leases. Property and
        equipment includes the following amounts for leases that have been
        capitalised.

                                      F-12

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

4.      PROPERTY AND EQUIPMENT (CONTINUED)


                                                             1999          1998
                                                      (pound)'000   (pound)'000

         Motor vehicles                                       226           308
         Less: accumulated depreciation                     (101)         (159)
                                                      -----------   -----------

                                                              125           149
                                                      ===========   ===========

        Depreciation of leased assets is included in depreciation and
        amortization expense.

5.      CONVERTIBLE PREFERRED SHARES

        The convertible preferred shares carried the same voting rights as
        ordinary shares, and the right (waived by the holders) to a gross
        dividend of 10% per annum.

        On June 1, 1996, the convertible preferred shares were converted into
        1,875,000 2p ordinary shares issued at a premium of 18p.

6.      SHARE OPTION PLAN

        The Company operates two share option plans for the benefit of directors
        and employees, an approved plan and an unapproved plan. Share options
        granted allow for the purchase of ordinary shares at prices not less
        than the fair market value of the ordinary shares at the date of grant.
        The options vest over 3 years and are exercisable 7 to 10 years from the
        date of grant.

        The following table summarises the option activity under the share
        option plans.


<TABLE>
<CAPTION>
                                                                     1999           1998          1997
                                                                      No.            No.           No.

<S>                                                             <C>              <C>         <C>
        Options outstanding at 1 April                          1,308,541        947,044     1,403,825
        Options granted                                           632,000        525,198        75,000
        Options exercised                                        (281,732)      (115,546)     (500,375)
        Options cancelled                                        (231,954)       (48,155)      (31,406)
                                                              -----------    -----------   -----------

        Options outstanding at 31 March                         1,426,855      1,308,541       947,044
                                                              ===========    ===========   ===========

        Weighted-average exercise price per share:
        Options granted                                            $12.88         $10.58         $2.26

        Options exercised                                           $1.30          $0.55         $1.29

        Options cancelled                                          $11.27          $6.60         $1.66
                                                              ===========   ============   ===========


        Weighted-average exercise price per share of
        options outstanding at end of the year                      $8.21          $4.94         $1.51
                                                              ===========   ============   ===========
</TABLE>


                                      F-13

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

6.      SHARE OPTION PLAN (CONTINUED)

        Details of share options granted but not exercised at March 31, 1999 are
        as follows:


<TABLE>
<CAPTION>
        Date of grant            Number of options            Exercise price                        Exercise period
<S>                                        <C>                   <C>                  <C>
        April 1994                         125,000               (pound)0.25                April 1997 - April 2004
        April 1995                          80,000               (pound)0.80                April 1998 - April 2005
        October 1995                       135,000               (pound)1.25            October 1998 - October 2005
        February 1996                       30,000               (pound)1.40          February 1999 - February 2003
        March 1996                          66,485               (pound)1.40                March 1999 - March 2006
        April 1996                          75,000               (pound)1.40                April 1999 - April 2006
        April 1997                          75,210                   US$8.75                April 2000 - April 2007
        May 1997                            98,642                  US$9.375                    May 2000 - May 2007
        June 1997                            3,000                  US$10.00                  June 2000 - June 2007
        July 1997                          120,047                  US$11.50                  July 2000 - July 2007
        October 1997                         6,563                 US$15.625            October 2000 - October 2007
        January 1998                        28,000                 US$15.375            January 2001 - January 2005
        May 1998                           243,500                 US$16.875                    May 2001 - May 2008
        June 1998                           15,000                  US$13.50                  June 2001 - June 2008
        July 1998                           75,000                 US$13.125                  July 2001 - July 2008
        July 1998                           12,500                 US$15.125                  July 2001 - July 2008
        October 1998                        67,908                   US$9.75            October 2001 - October 2008
        October 1998                       170,000                   US$7.25            October 2001 - October 2008
</TABLE>

        The Company applies APB Opinion 25 and related interpretations in
        accounting for its plans. The option price for each grant of options was
        considered to be a reasonable estimate of the market value of shares at
        that date. Consequently, no compensation expense has been recorded in
        respect of these share options.

        Statement of Financial Accounting Standards No.123 "Accounting for
        Stock-based Compensation", ("SFAS 123") requires disclosure of pro forma
        information regarding net income and earnings per share had compensation
        cost been determined using the fair value method. The fair value of the
        Company's stock-based awards to employees was estimated as of the date
        of grant using the Black-Scholes option pricing model. Limitations on
        the effectiveness of the Black-Scholes option valuation model are that
        it was developed for use in estimating the fair value of traded options
        which have no vesting restrictions and are fully transferable and that
        the model requires the use of highly subjective assumptions including
        expected stock price volatility. Because the Company's stock-based
        awards to employees have characteristics significantly different from
        those of traded options, and because changes in the subjective input
        assumptions can materially affect the fair value estimate, in
        management's opinion, the existing models do not necessarily provide a
        reliable single measure of the fair value of its stock-based awards. The
        fair value of options granted was estimated assuming no dividends and
        using the following weighted average assumptions:


                                      F-14

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997


6.      SHARE OPTION PLAN (CONTINUED)

<TABLE>
<CAPTION>
                                                                                         1999           1998           1997
<S>                                                                                   <C>            <C>
        Risk-free interest rate                                                          4.7%           5.8%           6.3%
        Expected term                                                                 3 years        3 years        3 years
        Volatility                                                                      30.0%          20.0%          20.0%
        Weighted-average fair value per share for options granted during
        the year                                                                        $3.38          $2.30          $0.51
                                                                                      =======        =======    ===========

</TABLE>

        Had compensation cost for the Company's plans been recorded the
        Company's net income and earnings per share would have been as indicated
        below:

<TABLE>
<CAPTION>
                                                                                         1999           1998          1997
<S>                                                             <C>               <C>            <C>
        Net income                                              as reported             4,049          3,444         2,180
                                                                  pro forma             3,733          3,296         2,150
                                                                                  ===========    ===========    ==========

        Basic earnings per share                                as reported       (pound)0.45    (pound)0.59   (pound)0.44
                                                                  pro forma       (pound)0.42    (pound)0.56   (pound)0.43
                                                                                  ===========    ===========    ==========

        Diluted earning per share                               as reported       (pound)0.43    (pound)0.51   (pound)0.38
                                                                  pro forma       (pound)0.40    (pound)0.49   (pound)0.37
                                                                                  ===========    ===========    ==========
</TABLE>

7.      INCOME TAXES

        The Company's provision for United Kingdom income taxes resulted in
        effective tax rates that varied from the United Kingdom statutory income
        tax rate as follows:


<TABLE>
<CAPTION>
                                                                                         1999        1998           1997
                                                                                  (pound)'000    (pound)'000   (pound)'000

<S>                                                                                     <C>           <C>            <C>
        Expected income tax provision at 31% / 31% / 33%                                1,901         1,598          1,182
        Amortization of goodwill                                                          116            60              -
        Expenses not deductible for tax purposes                                           67            53             62
        Other                                                                               -             -              9
                                                                                  -----------    ----------    -----------

        Actual income tax provision                                                     2,084         1,711          1,253
                                                                                  ===========    ==========      =========

        Effective tax rate                                                              34.0%         33.2%          34.9%
                                                                                  ===========    ==========      =========
</TABLE>

        There are no significant differences between the financial reporting and
        tax bases of assets and consequently there are no deferred tax assets
        and liabilities.
 .

                                      F-15

<PAGE>



NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997


8.      SALES AND GEOGRAPHIC INFORMATION

        Throughout the period the Company's revenue and income before interest
        and income taxes derived primarily from the provision of temporary
        staffing services.

        Domestic and export revenues for the three years ended March 31, 1999
        were as follows:


<TABLE>
<CAPTION>
                                                                                         1999           1998          1997
                                                                                  (pound)'000    (pound)'000   (pound)'000

<S>                                                                                    <C>            <C>           <C>
        United Kingdom                                                                 61,671         45,414        19,666
        Europe                                                                         28,045         12,348             -
        United States                                                                   3,574              -             -
        Rest of the World                                                               2,069            551             -
                                                                                  -----------     ----------     ---------

                                                                                       95,359         58,313        19,666
                                                                                  ===========     ==========     =========
</TABLE>

        The location of the Company's net property and equipment as of March 31,
        1999 is summarized below. Such information is not presented for 1998 or
        1997 as net property and equipment was primarily located in the United
        Kingdom.

<TABLE>
<CAPTION>

                                                                                                                      1999
                                                                                                               (pound)'000

<S>                                                                                                                  <C>
        United Kingdom                                                                                               3,083
        Europe                                                                                                          51
        United States                                                                                                  192
                                                                                                                ----------
                                                                                                                     3,326
                                                                                                                ==========
</TABLE>


        The Company did not receive more than 10% of consolidated revenue from
        any one customer in the year ended March 31, 1999 and 1998
        ((pound)2,359,000 and (pound)2,242,000 from two customers in 1997 each
        of which exceeded 10% of consolidated revenues)
)

9.      COMMITMENTS AND CONTINGENCIES

        Leases

        The Company leases some of its facilities under non-cancelable operating
        lease agreements. Future minimum lease payments under these operating
        leases as of March 31, 1999 are as follows:



                                      F-16

<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Years ended March 31, 1999, 1998 and 1997

9.      COMMITMENTS AND CONTINGENCIES (CONTINUED)



        Year ending March 31,                                    (pound)'000

        2000                                                             466
        2001                                                             466
        2002                                                             397
        2003                                                             339
        2004                                                             292
        Thereafter                                                     1,257
                                                                   ---------

        Total minimum lease payments                                   3,217
                                                                   =========

        Rent expense of (pound)473,000, (pound)290,000 and (pound)103,000 was
        incurred in 1999, 1998 and 1997 respectively.

        Cross guarantee

        The company's bankers hold a fixed and floating charge over the assets
        of the company as security over any overdraft. As at March 31, 1999 the
        company had no overdraft (1998 - (pound)68,000).

        In addition, the company is subject to a cross guarantee covering
        overdrafts of certain group companies. The company had a contingent
        liability of (pound)8.20m at March 31, 1999 under this guarantee (1998 -
        (pound)nil).

        Security

        The company pledged the assets and ordinary shares of The Woolf
        Group, Inc. as security up to a maximum of $15m to the selling
        shareholders of The Woolf Group, Inc. in respect of the aggregate
        contingent consideration that may become payable in each of May 2000,
        May 2001 and May 2002.

10.     UNUSUAL ITEMS

        The Company incurred the following non-recurring unusual items in the
        year ended March 31, 1999 all recognized within Selling, general and
        administrative expenses; (pound)403,000 relating to restructuring costs
        at its Salisbury Consulting Group subsidiary and costs of integrating
        its S-Com and EPL subsidiaries subsequent to acquisition; (pound)256,000
        relating to costs expected to be incurred at S-Com EPL in collecting
        certain international receivables and establishing general doubtful debt
        reserves; and (pound)150,000 of costs associated with an aborted
        acquisition.

11.     CAPITAL STRUCTURE

        In May 1998 the Company completed a secondary public offering of its
        ordinary shares. The Company issued 3,052,500 ordinary shares at $17.25
        raising (pound)28,778,000 net of issue costs. The proceeds were used to
        fund acqusitions and working capital requirements.

        During December 1998 and January 1999 the Company repurchased 762,000
        ordinary shares at an average price of $8.64.

                                      F-17