LONDON (dpa-AFX) - Hays Plc (HAS.L), a British recruitment company, on Thursday announced that it projects weak net fees in the fourth quarter amid challenging market conditions. Further, the company trimmed fiscal 2025 adjusted operating profit outlook below market estimates, citing a more challenging Perm markets.
Further ahead, the company projects current challenging conditions to persist into fiscal 2026.
In its trading update, the company noted that activity levels during the fourth quarter ending June 30 have reduced sequentially. This was mainly due to broad-based weakness in Perm markets globally reflecting low levels of client and candidate confidence as a result of macroeconomic uncertainty. Temp & Contracting activity continues to be more resilient.
The company currently expects fourth-quarter Group like-for-like net fees to decline by 9 percent from last year, or 8 percent on a working day adjusted basis, against a soft prior-year comparative, with Perm and Temp & Contracting down 14 percent and 5 percent respectively.
At a regional level, like-for-like net fees in its largest country Germany is projected to decrease by 5 percent with continued stability in Contracting but weaker conditions in Perm and Temp.
Perm has also weakened in the UK&I and a 13 percent divisional net fee decline is expected. In ANZ, net fees are expected to be down 9 percent from last year.
Net fees are expected to decline by 9 percent in RoW. EMEA ex-Germany net fees will be down 13 percent. Asia net fees will be down 3 percent, and Americas net fees will be down 1 percent, despite 5 percent year-over-year growth in North America where markets remain stable.
For the year, Hays now expects around 45 million pounds of pre-exceptional operating profit, while the company compiled consensus pre-exceptional operating profit for the full year is 56.4 million pounds.
In mid April, the company had said that fiscal 2025 operating profit would be in line with then consensus of 56.9 million pounds, despite ongoing uncertainties.
Hays noted that due to the largely fixed short-term nature of its cost base, there has been a high drop-through of lower net fees to profitability.
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