Connecting to LinkedIn...

Blank

HAYS PLC ISSUES TRADING UPDATE QUARTER ENDED 31 DECEMBER 2011

HAYS PLC ISSUES TRADING UPDATE

QUARTER ENDED 31 DECEMBER 2011

 

Financial summary

Growth in net fees for the quarter ended 31 December 2011 (Q2)     Growth      

(versus the same period last year)                                  

                                                             Actual     LFL*

By region                                                            

    Asia Pacific                                               15%     11%

    Continental Europe & Rest of World                        19%     20%

    United Kingdom & Ireland                                   (7)%     (7)%

    Total                                                       9%       8%

                                                                   

By segment                                                            

    Temporary                                                   14%     13%

    Permanent                                                   3%       1%

    Total                                                      9%       8%

                                                                     

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

Average exchange rates during the period were &pound1:AUD$1.55 and &pound1:&euro1.17

(AUD$1.60 and &euro1.16 in the prior year period)

 

Highlights

&middot Good Group net fee growth of 8%* versus prior year, despite market

  conditions becoming increasingly challenging as a result of heightened global

  macro-economic uncertainty

&middot Continued strong performance of our International business, which grew by 15%*

  and represented 70% of net fees in the quarter

&middot Strong growth of 20%* in Continental Europe & Rest of World, driven by Germany

  and France, which grew net fees by 28%* and 20%* respectively

&middot Robust net fee growth of 11%* in Asia Pacific, which included 10%* growth in

  Australia & New Zealand, and 16%* growth in the rest of Asia

&middot Net fees decreased 7% in the UK & Ireland, with private sector net fees

  declining 4%. Public sector net fees declined 16%, and remained broadly stable

  on a sequential basis

&middot Group consultant headcount increased 1% in the quarter

 

Commenting on trading for the second quarter, Alistair Cox, Chief Executive,

said:

"This quarter we delivered a good performance in the context of an increasingly

difficult macro-economic environment, which has particularly impacted candidate

and client confidence in the permanent recruitment market around the world. Our

International business, which delivered strong growth of 15%*, now represents

70% of Group net fees and we are the market leader in both Australia and

Germany, the two most attractive specialist recruitment markets in the world

today. In the UK, the environment remains difficult, especially in our Banking

and Public Sector-related specialisms.

Looking ahead to 2012, the macro-economic outlook is increasingly uncertain. We

will therefore focus on maximising our profitability and cash generation until

the outlook is more positive, taking advantage of our flexible cost base to

react to changes in each of our markets as they occur. With our global

footprint and market leadership in so many countries, we are well positioned to

manage through this period of uncertainty and take advantage of the long term

opportunities available to us around the world."

 

Group

In the quarter ended 31 December 2011, Hays, the leading global professional

recruitment group, increased net fees by 9% (8% on a like-for-like basis*)

against prior year. Net fees in the temporary placement business, which

accounts for 57% of Group net fees, saw strong growth of 13%*. Net fee growth

in the permanent placement business slowed to 1%* as increasing uncertainty

about the global macro-economic environment impacted confidence amongst the

Group's candidates and clients, notably in our Banking related specialisms.

The Group's underlying temporary placement margin** remained broadly stable and

in line with the previous quarter. The Group's consultant headcount increased

by 1% during the quarter, as we became more selective about areas for

investment, and reduced consultant numbers in certain countries.

 

AsiaPacific

In Asia Pacific we recorded net fee growth of 11%*. In our market-leading

Australia & New Zealand business, we recorded overall net fee growth of 10%*,

within which our temporary placement business performed strongly, increasing by

17%* and posting a record monthly net fee performance in the quarter, and our

permanent placement business was broadly flat*. We continue to see strong

performances in Western and South Australia, particularly in Resources & Mining

and associated support specialisms, but growth in other regions in Australia

has continued to moderate through the quarter.

Asia, which accounts for 14% of the division's net fees, achieved net fee

growth of 16%*. In Japan, we continue to see good progress as net fees

increased by 14%* and our business there posted a record monthly fee

performance in the quarter. Elsewhere, whilst performances in China, Singapore

and Hong Kong were strong overall, market conditions across the region became

progressively more difficult through the quarter.

Consultant headcount in the Asia Pacific division increased by 1% during the

quarter.

 

Continental Europe & Rest of World ('RoW')

In Continental Europe & RoW we recorded strong net fee growth of 20%*. Growth

continued to be strong in France where net fees increased by 20%*, and our

German business had another record performance this quarter as net fees

increased by 28%*. Growth in Germany was broadly based across all sectors, and

was particularly strong in our contracting and temporary placement businesses

which achieved an all time record in the quarter.

Growth in the rest of the division, which is primarily a permanent placement

business, slowed to 8% and was negatively impacted by the ongoing Eurozone

crisis and associated macro-economic uncertainty, particularly in some Southern

European and Latin American countries.

Consultant headcount in the Continental Europe & RoW division increased by 4%

during the quarter.

 

United Kingdom & Ireland

In the United Kingdom & Ireland, net fees decreased by 7% in the quarter. In

our private sector business, net fees declined by 4% in large part due to

slowing activity in our permanent placement business particularly in our

Banking and City-related specialisms. Elsewhere in our private sector business,

our IT, Legal, Life Sciences and Sales & Marketing businesses continued to

demonstrate relative resilience.

In our public sector business, net fees decreased by 16% year on year, and

remained stable on a sequential basis.

Consultant headcount in the United Kingdom & Ireland division decreased 2% in

the quarter.

 

Cash flow and balance sheet

As expected, net debt increased to around &pound180 million (30 September 2011:

around &pound175 million) at the end of the quarter due to the timing and phasing of

cash flows and payment in November of the Group's final dividend. As previously

guided, we expect this to reduce in the second half of the Group's financial

year.

 

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

Average exchange rates during the period                   were &pound1:AUD$1.55

and &pound1:&euro1.17 (AUD$1.60 and &euro1.16 in the prior year period)

** 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.

Tags:

Articles similar to

Articles similar to