British recruiter PageGroup warns profit will nearly halve this year
Company sees 2024 profit at 60 mln stg vs 118.8 mln last year
Shares tumble nearly 15%
PageGroup sees no immediate sign of improvement across markets
Adds CEO comments in paragraphs 4-6; updates share prices in paragraphs 10-11
By Yadarisa Shabong
July 9 (Reuters) -British recruiter PageGroup PAGE.L warned profit would fall by nearly 50% in 2024 due to weaker-than-expected hiring in June and a more cautious view for the second half of the year, sending its shares down as much as 15% on Tuesday.
Recruiters have struggled with declining profits over the last couple of years as employers lay off staff and cut back on hiring, while employees are reluctant to switch jobs and accept offers due to broader economic concerns.
Weak results were seen across its markets, from the U.S. to France, Germany and Britain, China and South East Asia, PageGroup said.
CEO Nicholas Kirk told analysts on Tuesday he was most concerned about France, the group's largest market, as the political uncertainty there was making recruitment activity even worse.
"Coming back after that (election) weekend, we had a number of clients contact us... candidates either wanting to pull out of processes to wait to see what happened, or clients putting interviews on pause and recruitment on pause," Kirk said.
He added that the group has not seen uncertainty recede even after the second round of French elections on Sunday, which thwarted the far right's quest for power but delivered a hung parliament.
Kirk said earlier in a statement that the group had "continued to see challenging market conditions... in Q2 and we experienced a softening in activity levels through the quarter, particularly in terms of new jobs registered and number of interviews."
There have been no immediate signs of improvement, PageGroup said, adding that recruitment budgets have tightened and offers made to candidates were "not as elevated" as they were in 2022 and early 2023.
The company said converting interviews into accepted offers is the most significant area of challenge for the group.
Shares of PageGroup were down 6% by 0913 GMT, having pared earlier losses.
Its London-listed rival Hays HAYS.L, which is set to report quarterly results on Thursday, slipped 3%. European peers Adecco ADEN.S and Randstad RAND.AS also fell about 2% each.
PageGroup now expects full-year 2024 operating profit to be in the region of 60 million pounds. It reported a profit of 118.8 million pounds last year.
Gross profit in the second quarter fell 12% to 224.3 million pounds ($287.2 million), with fees in June down 18% on last year.
($1 = 0.7811 pounds)
Reporting by Yadarisa Shabong in Bengaluru; Editing by Janane Venkatraman, Mrigank Dhaniwala and Jan Harvey
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
