Hays optimistic of strong second half after third-quarter recruitment growth

10th Apr 2015 07:19

After a strong third quarter showing, recruiter Hays said it now expects to deliver second half operating profits slightly ahead of the first.In the three months to 31 March, the FTSE 250 recruitment firm increased net fees 5% against the prior year on a headline basis and 8% on a like-for-like basis, although this was down from the excellent 10% LFL growth in the first half.The depreciation of both the euro and the Australian dollar against sterling was the main difference between actual net fee income and the LFL figure, and is expected to trim full year operating profits by circa £11m."Conditions remained supportive in the majority of our markets and we delivered growth of 10% or more in 15 countries including key growth markets such as France, China, Japan and the US," said chief executive Alistair Cox.Indeed, Hays enjoyed growth in each of its three regions, led by demand for permanent staff.The UK & Ireland, which represented 36% of group net fees, grew 8% against challenging comparatives, including 11% growth from the perm business as a strong UK start tapered modestly as the quarter progressed.IT was by far the strongest growth segment in the UK, followed by construction and public sector education.Continental Europe and the rest of the world, the largest region at 42% of net fees, grew 8% as Germany delivered 4% growth and the rest of the division grew 12%.There was 9% growth from Asia Pacific, which represented 22% of group net fees, as the Australia business continued to recover.Australia & New Zealand were together up 7% and the smaller Asia segment up 14% from strong growth in China and Japan.Net debt was broadly flat over the quarter at roughly £80m but management expects it to reduce significantly in the final quarter.