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UK NFI down 11% in Q3 2019 for Robert Walters

Robert Walters has released a trading update for the third quarter of 2019.

Group net fee income up 2% to £105.6m (4% actual) against significant political uncertainty in a number of the Group's markets, specifically including Brexit, US-China trade tensions; and Hong Kong protests.

Full year profit before tax is now expected to be in line with the prior year. 76% (2018: 72%) of the Group's net fee income now derived from overseas businesses.  

In the UK, net fee income was down 11% to £24.8m. Client and candidate confidence continued to be generally weak in the  UK  across both the recruitment and recruitment outsourcing markets. Certain sectors have proved resilient, particularly across the IT market nationwide, whilst in the regions,  Birmingham  and  Milton Keynes  delivered solid growth.

In Asia Pacific, net fee income was up 3% to £44.8m (9% actual). In Asia Pacific, Japan, Malaysia, Vietnam and New Zealand delivered the strongest performances; all increasing net fee income in excess of 13%.  Australia delivered 4% net fee income growth with activity levels highest in Sydney and Melbourne.

Europe net fee income was up 9% (10% actual) to £26.9m. A blend of permanent, contract and interim recruitment revenue streams continues to be a key strength. There was a good performance in France, the region's largest business, increasing net fee income in excess of 10%. The Netherlands, Spain and Switzerland all increased net fee income in excess of 15%.

Other International (the Americas, Middle East and South Africa) saw net fee income up 12% (18% actual) to £9.2m with San Francisco, Canada and the Middle East performing strongly. Our new businesses in Mexico and Chile have started well.  

Robert Walters, chief executive, commented, "The Group delivered net fee income growth of 2% (4% actual) during the third quarter as trading conditions softened across a number of markets. The ongoing uncertainty surrounding Brexit, the US-China trade tariff standoff and Hong Kong protests, coupled with the significant impact of the gilets-jaunes protests experienced earlier this year have combined to create a unique set of cumulative headwinds.

"As a result of these macro uncertainties, the Group now anticipates delivering annual profits in line with the prior year.  Whilst visibility is limited, the Group's international footprint and diverse blend of revenue streams covering permanent, contract, interim and recruitment process outsourcing ensures we are well positioned to respond to any market opportunities as and when they arise whilst also having the agility to closely manage our cost base."  

The Group will publish a trading update for the fourth quarter ending 31st December 2019 on 9th January 2020.  

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