International specialist recruitment firm PageGroup (MPI: LSE) reported gross profit for the first quarter ending 31 March 2016 of £142.4 million, an increase of 3.6% in constant currency (CC) compared with £135.7 million during the same period last year.

Gross profit broken down by recruitment type was as follows:

“Current market conditions remain stronger at lower salary levels and in temporary roles,” CEO Steve Ingham said. “This was reflected by the strong growth of 9% in our Page Personnel business, where temporary recruitment represents 41% of gross profit. Our Michael Page business, where temporary recruitment represents only 17%, grew 2%. Overall, temporary recruitment grew by 10.6%, compared to 1.6% in permanent.”

By geography, the company achieved gross profit growth as follows:

“The group delivered gross profit growth of 3.6% in constant currencies, despite the timing of Easter and the challenging market conditions in several of our larger markets, including Greater China, the UK and Brazil. However, we saw particularly good performances in the US, and Continental Europe, which now accounts for over 40% of the Group,” Ingham said.

Compared to the prior year, EMEA was up 10.3%, in line with the Q4 growth rate. France was up 2%, with Page Personnel France up 5%. In Germany, gross profit grew 6%, with Page Personnel up 17% and temporary recruitment up 40%. 

In the UK, while activity levels remained strong and in line with last year, conversion to gross profit was impacted by the timing of Easter and the uncertainty surrounding the EU Referendum. This led to the company’s growth rate slowing from 2% in Q4 2015 to flat in Q1 2016. The more technical disciplines and permanent placements at higher salary levels were most affected. Temporary recruitment (+6%) performed better than permanent (-3%), with Page Personnel (+9%) more robust than Michael Page (-3%). Legal discipline also saw excellent result (+23%). The mix (87:13) of Private and Public Sector remained in line with the last few quarters, with the Private sector flat in the quarter, but the Public sector down 2%. Reflecting the challenging trading conditions, fee earner headcount fell by 49 in the quarter.

The Americas gross profit decreased 5.3% in reported rates and 0.6% in constant currencies, with the strong US Dollar partially offsetting weaker currencies elsewhere.

In Latin America, gross profit decreased 10%, similar to Q4 2015. The political and economic uncertainty in Brazil continued to impact trading and, as a result, Brazil fell 31%. Elsewhere in Latin America, the other five markets which now represent 65% of the region, continued to perform well, growing 11% collectively, with a particularly strong result from Argentina.

Gross profit during Q1 2015 was broken down as follows:

“Despite the challenges in a number of our larger markets, the unpredictable nature of the current cycle and our limited visibility, we will continue to focus on driving profitable growth, whilst remaining able to respond quickly to any changes in market conditions,” Ingham said.

As of last trade, Michael Page International traded at £412.60, down 1.10% on the day and 15.15% above the 52-week low of £358.30 set on 25 Feb 2016. Based on its current share price, the company has a market value of £1.37 billion.