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Adecco revenue falls 26%, conditions still tough

May 06 2009

First-quarter revenue fell 26.4% year-over-year at Adecco SA, the world's largest staffing firm, to euro3.70 billion (US$4.89 billion). Adecco reported the business environment remains tough and there are no "clear signs of stabilization."

The Switzerland-based company said it plans euro14 million more in headcount reductions and structural changes in the second quarter. Adecco reported euro36 million (US$47.5 million) in restructuring costs for the first quarter. The number of full-time equivalents at Adecco was down 4,600 year-over-year in the first quarter compared to the year-ago quarter and there were 700 fewer branches. The company reported it still has more than 6,000 offices and 31,000 full-time equivalents.

First-quarter worldwide revenue fell 27% in constant currency.

In the U.S. and Canada, Adecco's second-largest market, first-quarter revenue fell 17.6% (26% in constant currency) to euro584.0 million (US$771.3 million). Slowing office/clerical and industrial businesses drove the decline, according to the company. U.S. and Canadian industrial revenue fell 35% in constant currency, while office/clerical revenue fell 30%.

Adecco also reported first-quarter information technology revenue fell 21% on a constant currency basis in the U.S. and Canada, and engineering and technical revenue in the countries fell 23% in constant currency.

In France, Adecco's largest market, first-quarter revenue fell 32% year-over-year to euro1.10 billion (US$1.46 billion).

Adecco reported first-quarter gross margin improved to 18.5% from 18.1% in the year-ago quarter with a boost from its outplacement business. First-quarter outplacement revenue in the U.S. rose 83%, CFO Dominik de Daniel said in a conference call with analysts.

First-quarter net income fell 83.3% to euro23.0 million (US$30.4 million) from euro138.0 million in the year-ago quarter.

Adecco SA
For the first quarter ended March 31, 2009, compared with the same period in 2008.
Revenue: euro3.70 billion (US$4.89 billion), -26.4%
Net income: euro23.0 million (US$30.4 million), -83.3%

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