Recruit Group sees 11% profit increase at year-end 2017
Recruit Group has released its results for the year ended 31st March 2018 (FY 2017).
Recruit Holdings’ consolidated revenue for FY2017 was 2.17 trillion yen, an increase of 11.9% from the previous fiscal year. This was mainly due to continued growth of its staffing and HR technology segments. The exchange rate movements positively impacted consolidated revenue during the period by 56.5 billion yen.
Consolidated operating income for FY2017 was 191.7 billion yen, a decrease of 0.9% from the previous fiscal year. This was mainly due to a decrease in other operating income year on year, as a non-recurring gain of 21.9 billion yen was recorded in the second quarter of FY2016 mainly resulting from the sales of a subsidiary in the Travel business in the Media & Solutions segment.
Profit before tax for FY2017 was 199.2 billion yen, an increase of 0.2% from the previous fiscal year.
Profit for the year was 152.3 billion yen in FY2017, an increase of 11.0% from the previous fiscal year, and profit attributable to owners of the parent in FY2017 was 151.6 billion yen, an increase of 11.0% from the previous year. Both profit for the year and profit attributable to owners of the parent for FY2017 benefited mainly from lower income tax expense resulting from tax reforms in the United States and European countries.
Revenue in the staffing segment was 1.29 trillion yen, an increase of 10.9% from the previous fiscal year. This was mainly due to higher revenue from the Japan operations, which was supported by a favourable market environment. In addition, movements in foreign exchange rates positively impacted revenue from the overseas operations.
Segment EBITDA was 72.7 billion yen, an increase of 10.8% year on year. This was mainly due to increased revenue from both Japan and overseas operations. The breakdown of segment EBITDA is as follows: 33.8 billion yen from Japan operations, an increase of 15.0% year on year, and 38.9 billion yen from overseas operation, an increase of 7.4%.
The Japanese staffing market continues to expand as evidenced by the continued increase in the number of active agency workers. In this environment, the Japan operations focused on extending existing staffing contracts and increasing the number of new staffing contracts. As a result, revenue was 509.2 billion yen, demonstrating strong growth of 9.9% year on year.
Overseas revenue was 789.5 billion yen, an increase of 11.6% from the previous fiscal year. This was mainly due to the full year contribution of Recruit Global Staffing B.V., renamed from USG People B.V. in January 2018, which started to be consolidated in June 2016, and the positive impact of foreign exchange rate movements of 47.6 billion yen. Excluding the impact of foreign exchange rate movements, revenue increased by 4.9% year on year. Also, excluding the impact of Recruit Global Staffing B.V. consolidation and foreign exchange rate movements, revenue declined by 2.6% year on year. This was primarily due to adopting Unit Management System, which mainly focuses on profitability improvement. In addition, the overseas operations experienced a decrease in transactions with existing clients due to the challenging business environment in some industries in the United States.
Photo courtesy of Shutterstock.com