German staffing firm Amadeus FiRe (AADX:GER), reported group revenue rose by 4.3% to €226.1 million in the first half of the year.

Growth in the Training segment offset a small decline in the personnel services segment. 

The group said its personnel services segment was under pressure.

Amadeus FiRe stated in a press release, “The recruitment behaviour of many client companies in the personnel services segment has declined as a result of the recessionary economic situation and negative sentiment. Candidates are also acting more carefully in their willingness to change jobs. With demand declining but remaining at an acceptable level, the positive conclusion of placement processes has been noticeably hampered compared to previous years.”

In the second quarter, group operating EBITA increased by 4.7% compared to the previous year. At the end of the first half of 2024, however, group operating EBITA was still 12.1% down on the previous year at €28.9 million.

Revenue by segment

Amadeus FiRe said the continuing recessionary mood within the German economy had a noticeable impact on the development of the personnel services segment at the end of the first half of the year.

The group added that companies are increasingly pessimistic about their development and are more reluctant to fill vacancies. While interim and project management services continued their positive development, sales of temporary staffing and permanent placement services were down on the previous year. However, when viewed in conjunction with the external circumstances and the significant fall in market volumes, the decline is within an acceptable range.

Permanent placement revenue fell by 6.9% in the second quarter, exactly matching the level of the first quarter. Turnover from temporary staffing services in the second quarter was 2.1% down on the previous year. Interim and project management services have so far been unaffected by the slowdown in recruitment successes, with another positive performance (29.3% in the second quarter).

H1 revenue within temporary staffing services fell by 4.3% while permanent placement revenue was down 6.2% and interim project management increased by 28.7%.

Gross profit in the segment was down 4.8% on the previous year at the half-year mark, with an improvement in the second quarter (-2.2% below the previous year).

Within the training segment, Amadeus Fire said the market for publicly funded training developed positively in the first half of the year 2024 compared to the previous year. Spending by the German Federal Employment Agency increased by 18.9% compared to the previous year.

Looking ahead, Amadeus FiRe said that for the remainder of 2024, no general improvement in economic development is expected. The economy could improve marginally, but the economic situation will continue to be characterised by caution and restraint on the part of the company.

As a result of the persistently challenging economic situation, the management board is adjusting the forecast made in the 2023 annual report.

At the current point in time, the personnel services segment is expected to fall well short of the segment target set for the end of the year and miss the previous year’s result. Although, the fundamental business drivers for the Personnel Services segment are intact, a significant improvement is no longer expected for the current year. Given the current low market level, the management board conservatively assumes that the market will not improve at all over the remainder of the year.

In the training segment, the results for the first half of the year exceeded its own expectations. The positive trend is expected to continue in the second half of the year.

The management board is reducing its forecast for the 2024 financial year and is now expecting to achieve group operating EBITA in the range of €64 million to €70 million after €70 million in the previous year. The adjusted forecast is linked to the expectation of closing the second half of the year at a comparable earnings level to the second half of the previous year.

Amadeus Fire set a new 52-week low during today’s trading session when it reached €94.00. Over this period, the share price is down 7.16%. Amadeus FiRe shares last traded at €98.60, up 0.61% on the day. The company has a market cap of €573.64 million.

Tags: Germany, earnings, revenue