Hays net fees fall amid tough global recruiting market
(Sharecast News) - Global recruiter Hays reported a fall in net fees in a challenging third quarter on Tuesday, down 17% in total year-on-year, and 14% lower on a like-for-like basis.
The FTSE 250 company said declines were seen across all divisions, with Germany experiencing a 16% decrease, the UK and Ireland a 16% decrease, Australia and New Zealand a 29% decrease, and the rest of the world a 14% decrease.
Looking at the numbers segmentally, Hays said temporary placements experienced a 14% decrease, while permanent placements saw a steeper decline of 21%.
Amid challenging market conditions, Hays said it was focussed on cost reduction and efficiency programmes, aiming to achieve £50m in annualised cost savings by the end of the 2024 financial year, with £20m of that expected to be structural.
Looking ahead, the company said it anticipated near-term market conditions to remain challenging but stable.
However, the impact of temporary and contracting hours worked in Germany would continue to be a significant factor affecting fee and profit performance.
"Market conditions remained challenging through the quarter," said chief executive officer Dirk Hahn.
"In Australia, and the UK and Ireland, temp activity was stable through the third quarter, although volumes in each are down around 15% year-on-year, and slightly below pre-Christmas levels.
"In Germany, temp and contractor volumes decreased by 5% year-on-year, and fees were also impacted by lower-than-normal average hours worked per assignment."
Hahn said group permanent activity was stable through the quarter, although the company continued to see extended 'time-to-hire', impacted by low levels of client and candidate confidence.
"While economic uncertainties remain, we have a strong and clear strategy and will continue to build a more resilient business through greater focus, increased operational rigour and strong cost management.
"As set out at our first-half results, we are firmly focused on targeting the many structural growth opportunities we see and, over time, rebuilding our conversion rate.
"Driven by our strong teams of talented colleagues worldwide, I am excited by what we can achieve once our end markets recover."
At 0852 BST, shares in Hays were down 3.05% at 89.68p.
Reporting by Josh White for Sharecast.com.
Disclaimer & Declaration of Interest
The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.