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Financial summary

Growth in net fees for the quarter ended 30 June 2011 (Q4)       growth

(versus the same period last year)                         actual     LFL*


By region                                                            

    Asia Pacific                                           30%       18%

    Continental Europe & Rest of World                    26%       28%

    United Kingdom & Ireland                               (6)%     (6)%

    Total                                                   14%       11%


By segment                                                            

    Temporary                                               13%       11%

    Permanent                                               16%       12%

    Total                                                14%       11%

* LFL (like-for-like) growth represents organic growth at constant currency.


&middot Group net fee growth of 11%* against prior year, underpinned by excellent performances across the International business, which represented 67% of net fees in the quarter

&middot Broadly based growth in Continental Europe & Rest of World ("RoW") division with net fees up 28%*, driven by continued strength in Germany which grew net fees by 28%*

&middot Strong net fee growth of 16%* in Australia & New Zealand, and continued excellent growth across the rest of Asia which grew net fees by 30%*

&middot Net fees decreased by 6% in the UK, with 7% net fee growth in the private sector offset by tough public sector markets, down 34%

&middot Continued consultant headcount investment in the International business, up 5% in the quarter and added new offices in Brazil, Ireland, Japan and Poland

Commenting on trading for the quarter ended 30 June 2011, Alistair Cox, Chief

Executive of Hays plc, said:

"This quarter we have continued to deliver good and broad based net fee growth,

driven by our International operations which grew net fees by 23%*. Around the world, 18 countries increased net fees by more than 20%* in the quarter. Our Continental Europe & RoW division delivered an excellent performance and is now the Group's largest division by net fees. Our Asia Pacific division delivered another strong set of results despite the impact of the natural disasters earlier in the year. In the UK, momentum in the private sector recovery has slowed and therefore we have further reduced the cost base to improve the profitability of this business going forward.

Our business continues to benefit significantly from the excellent opportunities available to us across the International markets. We have transformed our Group to reflect this and our International business now generates over two-thirds of the Group's net fees. We have achieved this by continuing to invest, for example increasing our International consultant headcount by 27% over the last year alone. Our increasingly global business supported by our investments in technology, training and marketing positions us ideally to further capitalise on the long term structural growth opportunities around the world."


In the quarter ended 30 June 2011, Hays, the leading global professional recruitment group, increased net fees by 14% (11% on a like-for-like basis*) against prior year. Net fees from the temporary placement business increased by 11%* and net fees from the permanent placement business increased by 12%*, as the Group continued to see strong levels of growth across most of its markets.

The Group's underlying temporary placement margin** remained stable and in line with the previous quarter. The Group's consultant headcount increased by 4% during the quarter, driven by ongoing investment in Australia, Asia, Continental Europe and South America. During the quarter the Group added new offices in Tokyo, Dublin, Curitiba in Brazil and Poznan in Poland, as the Group continues to build its International platform for growth.

Overall, the Group's profit performance in the second half has remained in line

with the Board's expectations.


In Asia Pacific, we recorded net fee growth of 18%*. In our market leading Australia & New Zealand business net fees increased by 16%* despite facing tougher comparables, with permanent placement net fee growth of 8%* and temporary placement net fee growth of 22%*. Overall net fee momentum continues to be good, led by strong growth in Western and South Australia, particularly in Accountancy & Finance, IT and Resources & Mining. Our businesses in Brisbane and Christchurch have responded strongly to the challenges imposed by the natural disasters and we expect the second half net fee and operating profit impact of these events to be approximately &pound1 million, at the lower end of the range previously guided.

Asia, which accounts for 15% of the division's net fees, achieved net fee growth of 30%*. Performances in China, Singapore and Hong Kong were excellent  as each achieved net fee growth in excess of 50%*, with all time record performances in China and Singapore. The earthquake and subsequent disruption in Japan has impacted our operations there, and net fees decreased 2%* this quarter. The response of this business has been very strong and as a result we expect the second half net fee and operating profit impact to be approximately &pound1.5 million, lower than previously guided.

Consultant headcount in the Asia Pacific division increased by 1% during the quarter, and we continue to invest to ensure we capitalise fully on the opportunities for growth we are seeing across the division.

Continental Europe & Rest of World ('RoW')

In Continental Europe & RoW, we recorded net fee growth of 28%*. Our German business had another record net fee performance this quarter, growing net fees by 28%* and we continue to see strong momentum and growth in this business, despite tougher comparables. Growth in Germany was broadly based across our contracting and temporary placement businesses, and across all of the sectors in which we operate. Most other countries in the division continued to see improving market conditions with 13 countries recording net fee growth above 20%*. In particular we saw excellent performances in Brazil, Denmark, Italy, Poland, Russia and UAE which each achieved net fee growth in excess of 40%*, with our businesses in Brazil, Denmark, Italy, Poland and Russia producing record net fee performances in the quarter.

Consultant headcount in the Continental Europe & RoW division increased by 8% during the quarter as we continue to invest broadly across the division.

United Kingdom & Ireland

In the United Kingdom & Ireland, net fees decreased by 6% in the quarter. Our private sector business, which represents 78% of the division's net fees, grew net fees by 7% this quarter. Growth and momentum weakened versus the previous quarter in large part due to tougher market conditions faced by our Banking and City-related businesses. We continued, however, to post strong performances in our Construction & Property, IT, and Sales & Marketing businesses. Our public sector business, which represents 22% of the division's net fees, again faced difficult market conditions in the quarter with net fees decreasing by 34%.

Public sector net fees are now down 57% from peak levels, however this business performed in line with our expectations through the quarter.

Consultant headcount increased by 3% in the quarter, although remains 5% below prior year levels. Through the actions taken across the year to reduce the cost base, we expect the division's second half operating profit to be in line with first half levels. Given the lower level of momentum in the private sector recovery we have responded by reducing our non-consultant cost base and it is anticipated that this will generate cost savings of around &pound7 million per annum going forward.

Cash flow and balance sheet

Net debt increased slightly to around &pound135 million at the end of the period (31 March 2011: circa &pound130 million), following the payment of the interim dividend and the OFT fine of &pound5.9 million, which was significantly reduced on appeal.

* LFL (like-for-like) growth represents organic growth at constant currency.

** the underlying temporary placement gross margin is calculated as temporary placement net fees divided by temporary placement gross revenue and relates solely to temporary placements in which Hays generates net fees and specifically excludes transactions in which Hays acts as agent on behalf of workers supplied by third party agencies.


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