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Adecco revenue falls 5%, but gross margin improves

August 08 2013

Adecco Group reported second-quarter revenue fell 5 percent year over year (3 percent organically) to €4.93 billion (US$6.41 billion). Organic growth excludes acquisitions, divestitures and changes in currency valuation. Gross margin improved to 17.9 percent from 17.7 percent in the same quarter last year.

Second-quarter net income rose 12 percent to €126.0 million (US$163.9 million).

In North America, revenue fell 1 percent to €960 million (US$1.2 million) in the second quarter, but rose 3 percent organically.

North America segment results include:

  • General staffing: Revenue flat in constant currency with growth of 3 percent in industrial and a 3 percent decline in office/clerical
  • Medical and science: Revenue increased 9 percent in constant currency
  • Engineering and technical: Revenue up 3 percent in constant currency
  • Finance and legal: revenue down 1 percent in constant currency 
  • Permanent placement: Revenue up 10 percent in constant currency

“Labor markets are starting to stabilize around Europe and we see some more positive signs in our business,” said CEO Patrick De Maeseneire. “The gap to the market narrowed further in France, and North America continued to perform well. Price discipline and the business mix resulted in an improved gross margin and we further reduced SG&A year-on-year.”

Adecco’s outplacement division Lee Hecht Harrison posted a 5 percent increase in revenue to €83.0 million (US$108.0 million) in the second quarter.

Emerging markets grew 8 percent in constant currency to €480 million (US$624.3 million), with strong growth acceleration in Eastern Europe. UK and Ireland revenue rose 4 percent — benefiting from the London Summer Olympics — to €469 million (US$610.0 million), although permanent placement revenues fell 16 percent in constant currency.

In France, revenue fell 12 percent on a year-over-year constant-currency basis to €1.21 billion (US$1.57 billion) compared to second quarter 2012. And in Japan, revenue fell 9 percent in constant currency to €283 million (US$368.1 million), although the company stated profitability was healthy.

Adecco SA
 For the second quarter ended June 30, 2013, compared with the same period last year.
 Revenue: €4.93 billion (US$6.41 billion), -5 percent
 Net income: €126.0 million (US$163.9 million), +12 percent

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