Wise Group (WISE:SS), the Swedish staffing firm, reported revenue today for the third quarter ending 30 September 2019 of SEK 193.2 million (€18.1 million), down 1.4% compared with the same quarter last year. 

During the period, Wise Group’s Board of Directors decided to appoint a new Board of Directors in subsidiary Brilliant Future AB and initiate a capital raising process.

During the third quarter Boel Sjöstrand CEO of the subsidiary Wise Professionals AB and a member of Wise Group's management group chose at his own request to leave his employment and terminated his position in the company in September 2019.

On October 2019 Wise Group announced that it plans to divest Comaea as part of the restructuring of its subsidiary Edge HR AB.

Revenue by business segment was broken down during Q3 2018 as follows:

Ingrid Höög, CEO of Wise Group, commented, “The market for the Recruitment & Consulting segment has changed in the third quarter. We are now experiencing a clearer waiting to invest in certain areas of expertise. The change had a negative impact on sales during the quarter, as an increased focus on sales activities and a shift towards other areas with higher demand could not produce results. Demand in IT, market communication and recruitment specialists continues to be good, and we expect an increased focus on these areas over time to offset weaker demand in other areas.”

The HR segment Consulting & Leadership Development showed lower sales and profitability during the third quarter. The group said one of the reasons is lower activity among customers during the summer.

In the Digital HR Services segment the group said it was burdened with an expense of SEK 6.0 million (€0.5 million). regarding the restructuring of Edge HR in the first quarter and is affected by expansion costs and development of the technical platform in Brilliant Future.

Revenue by Geography

The Swedish segment was charged with a cost of SEK 6.0 million (€0.5 million) regarding restructuring of Edge HR in the first quarter and expansion costs and development of a technical platform in Brilliant Future. Swedish operations are also affected by the reduced profitability of Swedish recruitment operations.

The Swedish economy is facing a marked slowdown, with unemployment set to rise as companies cut back on investment. The August 2019 economic forecast from the European Commission's Directorate-General for Economic and Financial Affairs sees the rate of growth of Sweden's real GDP dropping to one percent next year, slower than all but four of the other 28 European Union members.

Finland had a weak start to the year with sales at a lower level than last year. It is mainly in the Recruitment & Consultancy segment that sales have fallen, which the group said was due to longer processes at the customer level.

“For the group as a whole, we have increased our activity during the quarter to ensure the best possible end of the year given the conditions and market conditions,” Höög said. “The measures that I previously initiated to increase cross sales between subsidiaries such as cost savings and efficiency improvements are continuing with full force. Nevertheless, we expect only marginal growth and weak profitability as a whole for the 2019 transition year. 2020 will also be burdened by costs related to investments in our digital HR operations and for new premises. The change work that is going on, together with the fact that we have satisfied customers and committed employees, nevertheless represents a good starting point for the coming year.”

In trading today Wise Group set a new 52-week low during today's trading session when it reached SEK 28.20 (€2.65). Over this period, the share price is down -40.62%. As of last trade shares were down 18.18% on the day. Based on its current share price the company has a market value of SEK 260.16 million (€24.4 million).