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Norman Broadbent reports challenging market in first half

Norman Broadbent reports challenging market in first half

July 11, 2024
Westminster - London

Main article

Staffing and executive search firm Norman Broadbent (NBB:LSE) cited challenging market conditions in the first six months of its fiscal year ending 30 June. Net fee income fell 14% year over year in the first half to £4.5 million.

Executive search net fee income fell 4% year over year. However, Norman Broadbent interim management — which is the smallest part of its business — fell 47% in the first half. The decrease was caused primarily by a reduction in fixed-term contract placements, the company said.

“Growth is rarely linear quarter to quarter, but there is no doubt that, as is the case across the entire executive search and staffing industries, we are navigating extremely challenging market conditions,” CEO Kevin Davidson said in a press release. “However, this doesn’t impact the confidence we have in our prospects.”

The company has been cost conscious in the first half, but it still invested in headcount to ensure it’s ready to capitalise on the recovery when it comes, Davidson said.

Norman Broadbent did report that search mandates rose 5% year over year in the first half, though the average fee value per mandate was down 9%. The decrease represented industrywide trends, particularly in the UK. 

“Consistent with our long-term growth ambitions, we are actively exploring synergistic acquisition opportunities and pursuing high-quality hiring options in the US,” Davidson said. 

“With high levels of staff retention, general economic confidence beginning to return, inflation seemingly under control and an overall expectation of an improvement in market conditions in H2 2024, we remain confident in our ability to deliver on our target of £1.25 million EBITDA by 2025,” he continued.   

Looking at just the fiscal second quarter, net fee income is down 15% year over year to £2.3 million. However, it was up 28% compared to the second quarter of the fiscal year two years ago.

Norman Broadbent expects to announce unaudited, interim first-half results in early September.

Share Price

Shares in Norman Broadbent closed up 3.85% to £6.75 on 11 July in London. They were 50.0% above their 52-week low.