The Adecco Group reported first-quarter revenue rose 6% year over year on an organic basis — excluding the impact of currency, acquisitions and divestitures — and adjusted for the number of business days. Net income, however, fell 26%.

First-quarter gross margin narrowed; the company said it was affected by unfavorable timing of holidays, higher sickness rates and strikes in Germany.

Permanent placement performance remained strong, with revenue up 18% organically.

North America general staffing revenue fell 2% on an organic basis in the first quarter, but perm placement revenue for the segment rose 22%.

First-quarter revenue in Adecco’s North America professional staffing segment was flat though permanent placement revenue rose 20%.

Business process outsourcing revenue, or BPO, fell 5% on a constant currency basis. BPO includes the company’s managed service provider and recruitment process outsourcing business lines.

Quote

“Over the last 12 months, significant progress has been made in the strategic development of the Group,” CEO Alain Dehaze said. “We are embedding best practices and deploying new tools to strengthen our core businesses. And we have expanded our solutions portfolio, organically and via targeted M&A, to include leading platforms in online staffing (Adia), freelance (YOSS), digital permanent recruitment (Vettery) and now up-/re-skilling (General Assembly).”

Revenue by geography

Detail by country

All of the following revenue changes are reported on an organic basis:

France

• Revenue rose 10% organically and business days adjusted. Revenue increased 10% in general staffing, which accounts for more than 90% of revenue, and grew by 4% in professional staffing. Revenue growth was broad-based, driven by manufacturing, logistics and automotive. Permanent placement revenue in France was up 19%.

North America, UK & Ireland general staffing

• Revenue edged down 1% organically and trading-days adjusted. North America general staffing, which accounts for approximately 75% of revenue, edged down 2%. UK & Ireland general staffing revenue edged up 1%, or up 2% trading-days adjusted, decelerating due to the annualization of large contract wins in the prior year in e-commerce and local government. Permanent placement revenue accelerated significantly in North America general staffing, up 22%; it was down 3% in the UK & Ireland.

North America, UK & Ireland professional staffing

• Revenue was down 3%, or down 2% business-days adjusted. North America professional staffing revenue was flat. Growth in engineering and technical, finance and legal, and medical and science was offset by a decline in IT. UK and Ireland professional staffing revenue fell 7%, or down 6% business-days adjusted, mainly due to a decline in IT. Permanent placement revenue increased by 20% in North America professional staffing and by 7% in UK and Ireland professional staffing.

Germany, Austria, Switzerland

• Revenue was down 1%, or up 2% trading-days adjusted. In Germany and Austria, revenue fell 3% or down 1% trading-days adjusted, impacted by the ongoing merger of the Adecco and Tuja general staffing brands, and regulatory changes. In Switzerland, revenue grew by 10% or by 15% trading-days adjusted.

Benelux and Nordics

• Revenue rose 7% or up 10% business-days adjusted. In the Nordics, revenue rose 6% or up 10% trading-days adjusted, led by double-digit growth in Norway, while growth in Sweden was slightly negative, or flat business-days adjusted. Revenue in Benelux rose 8% or up 10% business-days adjusted. Growth continued to be double-digit in the Netherlands while in Belgium growth was in the high single digits, both business-days adjusted.

Italy

• Revenue rose 17% or up 19% business-days adjusted.

Japan

• Revenue rose 1% or up 5% business-days adjusted, with growth in professional staffing and permanent placement.

Iberia

• Revenue rose 13% or up 15% business-days adjusted.

Rest of World

• Revenue rose 4% organically or 6% business-days adjusted. Revenue growth was 13% in Australia and New Zealand, 14% in Latin America, 5% in Eastern Europe & MENA while Asia was down 1% and India was down 14%, all business-days adjusted.

Lee Hecht Harrison

• Revenue fell 9% at the career transition and talent development provider, reflecting the counter-cyclical nature of career transition.

Revenue by business line

Share price and market cap

Shares in Adecco closed down 5.1% to 64.00 Swiss francs. The company had a market cap of 10.90 billion Swiss francs.