PageGroup reports improved performance across all regions
15 April 2014
International recruiter PageGroup saw an improvement in performance across all its regions as it reported a 7% rise in group gross profit in constant currency.
Tue 15 Apr 2014
International recruiter PageGroup saw an improvement in performance across all its regions as it reported a 7% rise in group gross profit in constant currency.
After taking into account currency fluctuations, it reported group gross profit of £126.6m in the first quarter of 2014, effectively flat compared with the same quarter of 2013.
Speaking at a presentation to City analysts this morning, chief executive officer Steve Ingham said the results were “positive and an improvement on the last quarter of 2013, and a signal that the markets are improving”.
Referring to the UK, Ingham said the company had seen “an improvement in all disciplines”, with higher levels of activity in all UK regions. However, “confidence had not returned to all parts of the business” with Page Executive continuing to experience more difficult market conditions than other parts of the business, particularly Page Personnel.
Finance and accounting (+11%), excluding financial services, and property and construction (+24%) performed particularly well. Ingham said the UK had seen selective headcount increases where there was no spare capacity to grow the business from the existing staff.
Ingham said the Americas had been the group’s “standout region”, with the US seeing its fourth consecutive quarter of gross profit growth above 30%.
Consequently, Ingham said, fee rates in Boston, New York and Chicago had recovered and were now around 25%, which was “much higher than [in the rest of] the group”. In contrast, he said that fee rates were lowest in the relatively weak markets of Australia and Spain.
He added that the US was one market where the shift from a client-driven market to a candidate-driven market had taken hold. “Candidates are getting more than one offer… and clients who act most decisively will get the candidate,” he said.
Europe “had turned positive” said Ingham, with Germany reporting gross profit up 6% in constant currency, while France had returned to growth. UAE, Poland and Turkey all achieved a record quarter.
Fee-earner headcount across the group increased by 105 (+3%) in the quarter, with total headcount rising to over 5,280 at the end of March 2014, as the company continued to invest, particularly in what it saw to be high potential markets.
The company says it expects to employ more fee earners and increase infrastructure where spare capacity is limited.
Since the start of 2014, PageGroup has begun more than 25 director and managing director moves around its business into markets such as Japan, China and the US, where it expects their experience will bring greater returns more quickly.
The company recently set up a business in Lima in Peru, its eighth country in the Americas.
Ingham added: “While economic conditions remain variable across our markets, we have the confidence to invest further in headcount and infrastructure, with the steps outlined above resulting in our anticipated investment in the business this year rising by £4m. At the same time, the positive momentum we are seeing in some of the leading indicators in a number of our markets means we would expect to meet current market expectations of full-year gross profit.”
Gross profit (£m)
Year-on-year % of Group Q1 2014 Q1 2013 % %
EMEA 42% 52.7 52.0 +1.3% +5.6%
UK 26% 32.8 30.3 +8.1% +8.1%
Asia Pacific 18% 23.0 26.1 -11.8% +1.2%
Americas 14% 18.1 18.4 -1.5% +15.6%
Total 100% 126.6 126.8 -0.2% +6.8%
Permanent 77% 97.7 97.9 -0.2% +7.4%
Temporary 23% 28.9 28.9 -0.1% +4.6%
After taking into account currency fluctuations, it reported group gross profit of £126.6m in the first quarter of 2014, effectively flat compared with the same quarter of 2013.
Speaking at a presentation to City analysts this morning, chief executive officer Steve Ingham said the results were “positive and an improvement on the last quarter of 2013, and a signal that the markets are improving”.
Referring to the UK, Ingham said the company had seen “an improvement in all disciplines”, with higher levels of activity in all UK regions. However, “confidence had not returned to all parts of the business” with Page Executive continuing to experience more difficult market conditions than other parts of the business, particularly Page Personnel.
Finance and accounting (+11%), excluding financial services, and property and construction (+24%) performed particularly well. Ingham said the UK had seen selective headcount increases where there was no spare capacity to grow the business from the existing staff.
Ingham said the Americas had been the group’s “standout region”, with the US seeing its fourth consecutive quarter of gross profit growth above 30%.
Consequently, Ingham said, fee rates in Boston, New York and Chicago had recovered and were now around 25%, which was “much higher than [in the rest of] the group”. In contrast, he said that fee rates were lowest in the relatively weak markets of Australia and Spain.
He added that the US was one market where the shift from a client-driven market to a candidate-driven market had taken hold. “Candidates are getting more than one offer… and clients who act most decisively will get the candidate,” he said.
Europe “had turned positive” said Ingham, with Germany reporting gross profit up 6% in constant currency, while France had returned to growth. UAE, Poland and Turkey all achieved a record quarter.
Fee-earner headcount across the group increased by 105 (+3%) in the quarter, with total headcount rising to over 5,280 at the end of March 2014, as the company continued to invest, particularly in what it saw to be high potential markets.
Since the start of 2014, PageGroup has begun more than 25 director and managing director moves around its business into markets such as Japan, China and the US, where it expects their experience will bring greater returns more quickly.
The company recently set up a business in Lima in Peru, its eighth country in the Americas.
Ingham added: “While economic conditions remain variable across our markets, we have the confidence to invest further in headcount and infrastructure, with the steps outlined above resulting in our anticipated investment in the business this year rising by £4m. At the same time, the positive momentum we are seeing in some of the leading indicators in a number of our markets means we would expect to meet current market expectations of full-year gross profit.”
Gross profit (£m)
Year-on-year % of Group Q1 2014 Q1 2013 % %
EMEA 42% 52.7 52.0 +1.3% +5.6%
UK 26% 32.8 30.3 +8.1% +8.1%
Asia Pacific 18% 23.0 26.1 -11.8% +1.2%
Americas 14% 18.1 18.4 -1.5% +15.6%
Total 100% 126.6 126.8 -0.2% +6.8%
Permanent 77% 97.7 97.9 -0.2% +7.4%
Temporary 23% 28.9 28.9 -0.1% +4.6%
