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View All NewsNetherlands – USG People reports improved full-year and Q4 earnings
Dutch staffing company USG People (USG: NL) reported revenue for the fourth quarter ending 31 December 2014 of €605.1 million, an increase of 4.3% compared with €580.4 million in Q4 2013.
Q4 2014 | Q4 2013 | Change | |
Revenue | €605.1 million | €580.4 million | +4.3% |
Gross Profit | €128.7 million | €128.7 million | +3.0% |
EBITDA | €32.0 million | €26.2 million | +22.0% |
The company incurred a non-recurring expense of €9.8 million in Q4 2014, €5.4 million of which was related to the company’s distribution network in the Netherlands, and an optimisation at USG People and Secretary Plus. The changes are expected to achieve annual costs reductions of €3 million from 2015.
On an annual basis, the company achieved revenue growth of 4.5% to €2.4 billion, up from €2.3 billion in 2013.
FY 2014 | FY 2013 | Change | |
Revenue | €2,355.0 million | €2,270.0 million | +4.5% |
Gross Profit | €492.1 million | €486.9 million | +2.0% |
EBITDA | €101.5 million | €78.3 million | +30.0% |
Rob Zandbergen, the CEO of USG People, commented: “We continued to improve our results in the final quarter of 2014. Higher revenue and lower expenses led to a rise in profitability. At the same time we generated a high cash flow, enabling us to further reduce our debt.”
“This is in line with our strategic objectives to increase profitability and lower our debt. In this respect our recent investments in online services provide additional opportunities for growth, both organically and for our star brands. This segment already achieved strong growth and profitability in the fourth quarter,” he added.
USG People operates three business segments; General Staffing, Specialist Staffing, and Professionals, primarily in the Netherlands, Belgium, France, and Germany.
The company’s revenue broken down by business segment was as follows:
(Millions) | Q4 2014 | Q4 2013 | Change | FY 2014 | FY 2013 | Change |
General Staffing | €361.7 | €346.6 | +4.0% | €1,407.4 | €1,354.0 | +4.0% |
Specialist Staffing | €202.4 | €195.9 | +3.0% | €792.8 | €749.1 | +6.0% |
Professionals | €38.0 | €36.9 | +3.0% | €147.7 | €148.6 | -1.0% |
Online Business Solutions | €3.0 | €1.0 | +200.0% | €7.1 | €2.6 | +173.0% |
Total Revenue | €605.1 | €580.4 | +4.3% | €2,355.0 | €2,270.0 | +4.5% |
Revenue per working day rose at USG’s General Staffing business rose by 3.5% compared with last year. In the Netherlands, there was a decline of 0.3% in revenue as Start People “underperformed”, with contracts ending sooner than expected. Newly acquired contracts, however, are expected to contribute to the growth in the first quarter of 2015.
Revenue per working day at Start People Belgium increased by 10.6% compared with last year, outperforming the market which grew by 5%. Start People France reported revenue growth per working day of 1.3% in Q4, despite the market contracting during the final months of the year.
Revenue per working day during the quarter at USG’s Specialist Staffing business was up 2.5% compared with last year. The division’s Unique business reported growth of 4% while revenue at Secretary Plus was down 2% compared with Q4 2013.
In the Netherlands, Specialist Staffing realised growth of 4.5% in revenue per working day while Unique grew by 4.7%. Secretary Plus in the Netherlands reported a return to revenue growth. In Belgium revenue per working day was up 4.8% at Specialist Staffing and 7.3% at Unique, while Secretary Plus reported a decrease in revenue per working day of 3.5%.
In Germany revenue per working day was down 1.2% in Q4, compared with a year ago. The impact of staffing shortages and clients hiring candidates on a permanent basis continued to have a negative effect in the final quarter of 2014, compared with Q4 2013.
USG Professionals revenue per working day was up 2.5% in Q4 2014, with growth of 0.8% in the Netherlands.
Revenue from the company’s Online Business Solutions stemmed from the company’s acquired businesses; Adver-Online (51% stake acquired in 2013), Netwerven (51% stake acquired in October 2014), and Connecting-Expertise (51% stake acquired in December 2014).
The company’s revenue geographically was broken down as follows:
(Millions) | Q4 2014 | Q4 2013 | Change | FY 2014 | FY 2013 | Change |
Netherlands | €262.9 | €256.0 | +3.0% | €1,011.7 | €976.2 | +3.0% |
Belgium | €164.2 | €149.6 | +10.0% | €624.3 | €584.9 | +7.0% |
France | €120.2 | €116.8 | +3.0% | €485.9 | €464.3 | +5.0% |
Germany | €55.8 | €56.1 | -1.0% | €225.2 | €221.6 | +2.0% |
Other | €2.0 | €1.9 | +5.0% | €7.9 | €7.2 | +10.0% |
Total Revenue | €605.1 | €580.4 | +4.3% | €2,355.0 | €2,270.0 | +4.5% |
Revenue per working day rose by 3.5% during the quarter, with acquisitions positively impacting growth. The company’s market share continued to grow in Belgium and France, as revenue per working day rose by 8.1% and 1.0%, respectively, compared with Q4 2013. In the Netherlands revenue per working day increased by 2.7%. Growth in the Netherlands lagged behind market growth in Q4 as a result of previously announced phasing out of several large contracts at the company’s Start People business.
Looking forward, Mr Zandbergen concluded: “The positive revenue trends are continuing in 2015. Revenue increased by 5% in January and continued to grow in the first few weeks of February. We expect this growth to continue in 2015 and that a further recovery in the SME segment will contribute to an increase in demand in our markets and to returns.”
In trading today, the company’s share price rose by 2.1% to €12.52, a decrease of 7.7% compared with a year ago. Based on its current share price, the company has a market value of €992.9 million.