REG - PageGroup plc - Second Quarter 2025 Trading Update
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RNS Number : 4412Q PageGroup plc 10 July 2025
10 July 2025
SECOND QUARTER 2025 TRADING UPDATE
RESILIENT PERFORMANCE DESPITE ONGOING MARKET UNCERTAINTY
Q2 Gross Profit Analysis
Reported (£m) Constant
Year-on-year % of Group Q2 2025 Q2 2024 % %
EMEA 53% 102.9 125.2 -17.8% -17.1%
Americas 19% 37.7 40.0 -5.7% +2.9%**
Asia Pacific 16% 31.2 32.2 -3.2% +0.6%
UK 12% 23.0 26.8 -14.3% -14.3%
Total 100% 194.8 224.2 -13.1% -10.5%
Permanent 73% 141.9 165.3 -14.1% -11.3%
Temporary 27% 52.9 58.9 -10.3% -8.2%
H1 Gross Profit Analysis
Reported (£m) Constant
Year-on-year % of Group H1 2025 H1 2024 % %
EMEA 54% 208.8 248.8 -16.1% -14.5%
Americas 19% 74.8 77.3 -3.3% +3.2%**
Asia Pacific 15% 59.2 64.3 -7.9% -5.3%
UK 12% 46.5 53.7 -13.4% -13.4%
Total 100% 389.3 444.1 -12.3% -9.7%
Permanent 72% 281.9 325.5 -13.4% -10.8%
Temporary 28% 107.4 118.6 -9.5% -7.0%
** Excluding Argentina due to hyperinflation
Q2 Key Points
· Group gross profit of £194.8m, -10.5% vs. Q2 2024 (Q1 2025: -9.2%)
· Resilient performance despite market uncertainty, mixed results
across the Group
· Continued subdued levels of client and candidate confidence impacted
decision making
· Decrease in fee earner headcount of 133 (-2.5%) in Q2 to 5,163 (Q2
2024: 5,598)
· Decrease in non-operations headcount of 61 (-3.2%) in Q2
· Productivity remains high but down 3% on Q2 2024
· Net cash of c. £10m (Q1 2025: c. £54m, Q2 2024: c. £57m)
· Cost reduction programme on track
Full Year Outlook
· The Board currently expects 2025 Operating Profit to be broadly in
line with current market consensus of c. £22m
Nicholas Kirk, Chief Executive Officer, PageGroup, said:
"We delivered a resilient performance despite ongoing market and tariff
related uncertainty, with mixed results across the Group. We saw a slight
deterioration in activity levels and trading in Continental Europe,
particularly in our two largest markets, France and Germany. However, we saw
some improvement in activity, trading and customer confidence in Asia and the
US.
"The conversion of accepted offers to placements remained the most significant
area of challenge, as ongoing macro-economic uncertainty continued to impact
confidence, which extended time-to-hire. Permanent recruitment continued to be
impacted more than temporary, as clients sought flexible options and permanent
candidates remained reluctant to move jobs.
"We also continued with our strategy of reallocating resources into the areas
of the business where we saw the most significant long-term structural
opportunities, as well as ensuring it remained aligned to the activity levels
we were seeing in each of our markets. Overall, our focus remains to balance
near-term productivity with ensuring we remain well placed to take advantage
of opportunities when market conditions improve.
"We continue to see the benefits of our investments in innovation and
technology. Customer Connect is supporting productivity and enhancing customer
experience, Page Insights is providing real time data to inform business
decisions for both Page and our customers, and we continue to work with our
partners to deploy AI and automation tools into our working environment.
"Despite the uncertain outlook due to the unpredictable economic environment,
we have a highly diversified and adaptable business model, a strong balance
sheet and our cost base is under continuous review."
Trading Summary
Group gross profit declined 10.5% in constant currencies against Q2 2024. We
saw varying market conditions across the Group, with a further worsening in
Continental Europe, and continued challenging conditions in the UK. However,
we saw some early signs of improvement in Asia and another quarter of growth
in the US.
Although salary levels remained strong, offers made to candidates were not as
elevated as they were in 2022 and early 2023 and, as a consequence, the
conversion of accepted offers to placements remained the most significant
challenge. While our fee rates remained at high levels, as clients'
recruitment budgets have tightened, they have become more risk averse, which
has continued to slow the recruitment process, impacting time-to-hire. In
addition, the levels of offers from clients to candidates remained relatively
low, raising the opportunity for the current employer to counter-offer.
Reflecting the uncertain macro-economic conditions, temporary recruitment
(-8.2%) continued to outperform permanent (-11.3%), as clients sought more
flexible options. This was broadly in line with Q1. We reduced our fee earner
headcount by 133 (-2.5%) in Q2, mainly in Europe. Productivity, measured as
gross profit per fee earner, declined 3% versus Q2 2024. This reflected the
reduction in gross profit, although this was partially offset by the decrease
in headcount.
Our non-operations headcount reduced by 61 (-3.2%) in Q2, including the end of
some double-running as we finalised the transition of our SSC from Singapore
to Kuala Lumpur.
Geographical Analysis (unless stated otherwise all Q2 growth rates are vs.
2024 and in constant currency)
EMEA Gross Profit (£m) Growth Rates
(53% of Group) 2025 2024 Reported Constant
Q2 102.9 125.2 -17.8% -17.1%
H1 208.8 248.8 -16.1% -14.5%
· France (13% of Group) -20%
· Germany (12% of Group) -21%
· Spain -6%
· Italy -18%
Total Headcount at 30 June 2025: 3,354 (31 March 2025: 3,441)
In Europe, Middle East and Africa, gross profit declined 17.1% to £102.9m,
with a worsening in market conditions. Reflecting this uncertainty, temporary
recruitment (-13%) was more resilient than permanent (-19%). France, the
Group's largest market, declined 20%, due to ongoing political and
macro-economic uncertainty. Reflective of market conditions, temporary
recruitment, down 11%, continued to outperform permanent, down 27%. Germany,
our second largest market, declined 21% in Q2, with conditions particularly
tough within permanent, with companies limiting and delaying hiring decisions
due to macroeconomic and tariff related uncertainty. Elsewhere in Europe,
trading conditions remained challenging in all countries. We reduced our fee
earner headcount in the region by 94, mainly in France.
Americas Gross Profit (£m) Growth Rates
(19% of Group) 2025 2024 Reported Constant
Q2 37.7 40.0 -5.7% +2.9%**
H1 74.8 77.3 -3.3% +3.2%**
· North America (11% of Group) +13%
o US +14%
· Latin America (8% of Group) -9%**
o Mexico -18%
o Brazil -5%
Total Headcount at 30 June 2025: 1,313 (31 March 2025: 1,320)
** Excluding Argentina due to hyperinflation
In the Americas, we delivered gross profit of £37.7m, up 2.9% against Q2
2024. In the US, we grew 14%, a third consecutive quarter of growth and an
improvement on the growth of 7% in Q1 2025. We saw good levels of activity and
trading, with continued strong results particularly in Engineering, and a
significantly improved performance in Construction. In Latin America,
excluding Argentina, gross profit declined 9%. Mexico, our largest country in
the region, declined 18%, due to ongoing political uncertainty and low levels
of customer confidence. Brazil was down 5%, albeit against a tough comparator.
Elsewhere in Latin America, our remaining countries declined 2%, collectively.
Fee earner headcount in the region increased by 12.
Asia Pacific Gross Profit (£m) Growth Rates
(16% of Group) 2025 2024 Reported Constant
Q2 31.2 32.2 -3.2% +0.6%
H1 59.2 64.3 -7.9% -5.3%
· Asia (14% of Group) +4%
· Greater China (4% of Group and 28% of Asia) -5%
o Mainland China -17%
o Hong Kong +16%
· South East Asia +10%
· Japan flat
· India +13%
· Australia -13%
Total Headcount at 30 June 2025: 1,471 (31 March 2025: 1,503)
In Asia Pacific, Q2 gross profit grew 0.6% against 2024 to £31.2m, its first
quarter of growth since Q2 2022 and a significant improvement on the decline
of 11.1% in Q1 2025. Within this region, 8 out of our 12 markets delivered
growth. Greater China declined 5%, with Mainland China down 17%. Hong Kong
grew 16%, due partly to a weak comparator, but also driven by improved
trading, particularly in Page Executive. South East Asia grew 10%, with a
particularly strong performance in Singapore, up 14%, with a particularly
strong performance in Page Executive. India delivered a second consecutive
record quarter, up 13%. Japan was flat, an improvement on the decline of 7% in
Q1. Australia declined 13%, with ongoing challenging conditions across most
states. Our fee earner headcount in the region increased by 5. Our
non-operations headcount decreased by 37 in Q2, including the end of some
double-running as we finalised the transition of our SSC from Singapore to
Kuala Lumpur.
UK Gross Profit (£m) Growth Rate
(12% of Group) 2025 2024
Q2 23.0 26.8 -14.3%
H1 46.5 53.7 -13.4%
Total Headcount at 30 June 2025: 896 (31 March 2025: 964)
In the UK, Q2 gross profit declined 14.3% against 2024 to £23.0m. The market
remains tough but stable, having delivered a similar growth rate as the
previous three quarters. The conversion of accepted offers to placements
remained a significant area of challenge, with ongoing subdued levels of
client and candidate confidence impacting decision making and increasing
time-to-hire. Our fee earner headcount decreased by 56 in the quarter.
Perm/Temp mix
Gross profit from permanent recruitment decreased 14.1% in reported rates and
11.3% in constant currencies to £141.9m (Q2 2024: £165.3m). Gross profit
from temporary recruitment decreased 10.3% in reported rates and 8.2% in
constant currencies to £52.9m (Q2 2024: £58.9m). This resulted in a ratio of
permanent to temporary recruitment of 73:27 (Q2 2024: 74:26).
Headcount
Our fee earner headcount reduced by 133 (-2.5%) during Q2, mainly in EMEA and
the UK. We continued to reallocate resources into markets where we saw
improvement in activity levels, such as in Asia and the Americas. Our
non-operations headcount reduced by 61 (-3.2%) in Q2, including the end of
some double-running as we finalised the transition of our SSC from Singapore
to Kuala Lumpur. Overall, the Group had 5,163 fee earners and a total
headcount of 7,034.
Foreign Exchange
Foreign exchange movements had a negative impact on the Group's results in Q2,
decreasing our reported gross profit by 2.6 percentage points, or £5.9m.
Financial Position
Save for the effects of Q2 trading detailed above, the payment of the 2024
final dividend of £36.9m and the purchase of shares into the Employee Benefit
Trust (EBT) of c. £7m, there have been no other significant changes in the
financial position of the Group since the publication of the results for the
quarter ended 31 March 2025. Net cash at 30 June 2025 was c. £10m (Q1 2025:
c. £54m, Q2 2024: c. £57m).
Shares
At 30 June 2025 there were 328,618,774 Ordinary shares in issue, of which
18,617,958 were held by the Employee Benefit Trust (EBT). The rights to
receive dividends and to exercise voting rights have been waived by the EBT
over 17,255,201 shares and consequently these shares should be excluded when
calculating earnings per share. The total number of voting rights in the
Company is 328,618,774.
Cautionary Statement
This Second Quarter 2025 Trading Update has been prepared solely to provide
additional information to shareholders to assess the Group's strategies and
the potential for those strategies to succeed. The Trading Update should not
be relied on by any other party or for any other purpose. This Trading Update
contains certain forward-looking statements. These statements are made by the
Directors in good faith based on the information available to them up to the
time of their approval of this Trading Update and such statements should be
treated with caution due to the inherent uncertainties, including both
economic and business risk factors, underlying any such forward-looking
information. This Trading Update has been prepared for the Group as a whole
and therefore gives greater emphasis to those matters that are significant to
PageGroup and its subsidiary undertakings when viewed as a whole.
The Group will issue its H1 results on 12 August 2025.
Enquiries:
PageGroup +44 (0)19 3226 4032
Nicholas Kirk, Chief Executive Officer
Kelvin Stagg, Chief Financial Officer
FTI Consulting +44 (0)20 3727 1340
Richard Mountain / Susanne Yule
The Company will host a conference call and presentation for analysts and
investors at 08.30am today. The live presentation can be viewed by following
the link:
https://www.investis-live.com/pagegroup/6841628df8132e000ea9312d/reger
(https://url.uk.m.mimecastprotect.com/s/74ZrCxvJGFJ0Ny3pU8fPhyceim?domain=investis-live.com)
Please use the following dial-in numbers to join the conference:
United Kingdom (Local) 020 3936 2999
All other locations +44 20 3936 2999
Please quote participant access code 49 25 84 to gain access to the call.
A presentation and recording to accompany the call will be posted on the
Company's website during the course of the morning of 10 July 2025 at:
https://www.page.com/presentations/year/2025
(https://www.page.com/presentations/year/2025)
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