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Recruitment giant Hays (HAS:LSE) today reported that net fees dropped by -1% in the three months to December 2012 as the staffing market for banking and finance jobs remained tough. The firm expects conditions to stay fragile and will tighten cost control.
Chief executive, Alistair Cox, said that several markets around the world were fragile in the quarter. But 12 countries delivered net fee growth of 10% or more, including Germany, Brazil, Canada and Russia.
“Other markets remained tough, notably the UK, Southern Europe and Banking-related specialisms, and we saw a step-down in activity levels in our Australian Resources & Mining business,” said Mr Cox.
The world’s sixth-largest staffing firm reported better business conditions in its temporary staffing segment where net fees were up +1%, compared to a -5% decline in its permanent placement segment.
In the UK & Ireland, net fees fell -3% with the private sector seeing a decline of -9% while the public sector showed growth of +15%. Temporary staffing was flat in the quarter and the permanent placement business posted a -9% decline.
In continental Europe & the rest of the world, the firm’s largest division, net fees improved by +12%, driven by strong performance in Germany where fees grew +14%. But business activities in Southern Europe proved difficult and the firm’s permanent staffing division saw fragile market conditions elsewhere in the region.
In Asia Pacific, net fees were down -14% and impacted its temporary staffing business in Australia & New Zealand where fees overall plummeted by -15%. Hays said that market conditions in Australia became more challenging and with Asian countries posting a -15% reduction in net fees, the firm cut staff levels by -9% year-on-year. In one of the world’s largest staffing markets, Japan, net fees fell -10%.
Despite the decrease in net fees, in early trading the company’s share price was up +2.5% to 87.60 pence, a +40.0% increase from a year ago, but -6.4% below its 52-week high of 93.55 pence seen in March last year. The firm has a market value of £1.20 billion, making it one of the world’s largest staffing companies by market capitalisation.