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United Kingdom - Michael Page, Hays, NES Group

January 09 2009

London-based staffing firms Michael Page International PLC and Hays PLC said tough economic conditions weighed on earnings in the fourth quarter with Michael Page announcing a reduction in headcount. But NES Group Ltd., a technical staffing firm based in Altrincham, England, said this week that revenue rose 16% for its fiscal year ended Oct. 31.

NES posted revenue of GBP252.8 million (US$416.6 million), up from GBP217.1 million in the previous year. NES cited strong organic growth across the U.K. and its global technical business. The company opened new offices in Australia, China, India and Nigeria. It now has 26 offices in 16 different countries, including the U.S.

It provides contract and direct-hire staffing in technical, engineering, information technology and railroad.

However, Michael Page, a professional staffing firm, said Thursday its fourth-quarter gross profit fell 7.3% amid a challenging economic environment. The company also cut its headcount by 509 in the fourth quarter; it now stands at 4,943.

"Market conditions became noticeably more difficult during the fourth quarter with many jobs being cancelled or put on hold," said Chief Executive Steve Ingham. "The impact of the financial crisis is now evident in virtually every market and discipline in which we operate, albeit to varying degrees and with different markets and disciplines at different points in the downturn."

Michael Page posted fourth-quarter gross profit of GBP118.8 million (US$172.0 million). While down 7.3%, the decrease was 16.1% on a constant currency basis.

Fourth-quarter gross profit for its Americas division fell 0.3% to GBP10.7 million (US$15.5 million); however, it dipped 13.2% on a constant currency basis.

Gross profit for the company as a whole for the full year rose 15.6% to GBP552.7 million (US$800.3 million), or 5.8% on a constant currency basis.

Michael Page plans to issue its full-year results on March 5.

In addition, Hays PLC said Thursday that net fees fell 6% for the quarter ended Dec. 31 as economic conditions became increasingly difficult. Net fees were down 10% on a constant currency basis.

Direct hire net fees fell 20% in the quarter, but temporary net fees rose 7%.

"Demand for permanent placements continues to fall at an increasing rate in the U.K. and Australia and has recently fallen in a number of other countries," said Chief Executive Alistair Cox. "Demand for temporary placements has been resilient to date across most of the group. We expect the usual seasonal weakening in January and the outlook for the re-engagement of temporary workers after the Christmas holiday is less clear than in previous years."

The company will issue results for the first six months of its fiscal year on Feb. 26.

Hays operates in 393 offices in 27 countries, although not in the U.S.


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