Brunel, the Netherlands-based global energy staffing firm, reported revenue increased by 21% on a like-for-like basis to €341.6 million in the third quarter of 2023 compared to the prior-year quarter. On a reported basis, revenue grew by 13%.

All regions saw growth during the third quarter period.

Revenue growth in contracting and fees for permanent placements remained strong despite the weaker market for perm placements in renewable energy.

CEO Jilko Andringa said, "Brunel continued its path of high organic growth in revenue, gross profit and EBIT. I am very proud that we were able to navigate the challenging circumstances with our result driven mindset. It is clear that we are outperforming the European market trends. In particular, our performance in The Netherlands stands out. In our other regions we see continued strong profitable growth in Americas, Australasia and Asia."

Andringa continued, "This quarter also demonstrated the resilience of our business model. We experienced some unexpected bumps in the road. Inflation impacted the business case of certain US based offshore wind projects and public biddings in Europe, leading to a slowdown in our permanent placement business in Taylor Hopkinson in the second half of the year. In our region Middle East & India, a large project was finished sooner than expected and a large project won earlier this year will start later than expected (early 2024), impacting our expected profitability growth for the next quarter."

"To continue our growth performance and drive further conversion, we will create a broader Executive Leadership Team," Andringa also announced.

"It has been decided in full alignment, that Graeme Maude (COO) will leave Brunel at the end of his 4-year contract term in May 2024," Andringa said. "I want to thank Graeme for his teamwork, his dedication, and his important role in the strategic transformation we made over the last four years."

"From 1 January 1 2024, Peter de Laat, CFO and I, as CEO, will be supported by a diverse and multi-skilled leadership team through four internal promotions: Tania Sinibaldi and Jon Proctor as managing director of operations, Joanita Oud as global head of people & culture and Stefan de Boer as global head of IT and digital. I want to congratulate Tania, Jon, Joanita and Stefan on this important step and look forward to working with them more closely."

The Supervisory Board said, "Graeme Maude has played a pivotal role in Brunel's journey towards identifying diversified market potential, devising a comprehensive strategy, fostering new capabilities, and establishing a robust framework for growth including development of its internal talent pool. This strategic transformation has paved the way for our ongoing success."

Maude said, "It has been a privilege to work with so many passionate and talented colleagues, all of whom are focused to move Brunel forward to further growth and success. It has been a highlight in my career to have spent time at Brunel and represent the company across the world."

Revenue by Geography

The DACH region includes Germany, Switzerland, Austria and the Czech Republic. Revenue per working day increased by 12% (organically), mainly due to higher rates at a slightly lower average headcount. The gross margin adjusted for working days was stable and reached 38.1% over Q3 2023 (Q3 2022: 38.0%).

In Q3, the Netherlands showed strong growth, with revenue per working day up by

16% (organically). The gross margin adjusted for working days was 27.7% (2022: 29.7%), mainly due to the impact of inflation and a higher number of freelancers.

Australasia includes Australia and Papua New Guinea. The group continued to achieve robust growth in both markets, with sustained demand in the mining and conventional energy sectors. Despite unfavourable foreign currency impacts, revenue increased by 14% this quarter. This represents 28%  growth adjusted for constant currencies %. The group's strategic emphasis on strong margins and value-added activities has yielded positive results, with our gross margin rising by 0.6 ppt.

Middle East & India includes Qatar, Dubai, Kuwait, Iraq and India. Brunel maintained its growth trajectory in nearly all countries within the region. However, Kuwait continues to trail. In Q3, a large project was finished sooner than expected, and another large project won earlier this year will start later than expected (early 2024).

The Americas include Brazil, Canada, the USA, Guyana and Surinam. Brunel continued to see strong growth in almost all countries, leading to a revenue growth of 18%, or 29% organically. This growth is mainly driven by new projects started in conventional energy.

Asia includes Singapore, China, Hong Kong, South Korea, Taiwan, Japan, Indonesia, Thailand and Malaysia. Revenue growth of 5%, or 17% on an organic basis, is driven by higher activities in mining in Indonesia and increased activity levels at fabrication yards in China. Brunel managed to improve its gross margins and conversion, achieving a significant increase in EBIT for the region.

Rest of World includes Taylor Hopkinson, Belgium and other energy activities in Europe. The higher activity level in contracting for conventional and renewable energy drove the growth in this region. At Taylor Hopkinson, the group faces a weaker market for perm placements in renewable energy. Until June 2022, this region also included Russia, whose activities were divested. In 2022, these activities contributed €18 million in revenue and €0.8 million of EBIT.

Looking ahead, the group said delays in the offshore wind industry will impact its Q4 performance, especially for perm placements for Taylor Hopkinson. Based on the outlook for this industry, Brunel is optimistic that this market will recover soon.

The Q4 performance of the Middle East & India will be negatively impacted by the postponement of a large infrastructure project and the earlier completion of another large project. For other regions, Brunel expects the positive trend to continue. As a result, it will continue to grow in Q4, but at a lower level than expected earlier and at a lower conversion rate.

Brunel International shares last traded at €11.96, down 10.75% on the day and 11.80% below its 52-week high of €13.56, set on 13 October 2023. The company has a market cap of €677.70 million.