REG - Robert Walters PLC - Q2 TRADING UPDATE

Robert WaltersAnnouncement

06/07/2023 07:00

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RNS Number : 1056F  Robert Walters PLC  06 July 2023

6 July 2023

 

ROBERT WALTERS PLC

(LSE: RWA)

 

(the 'Company' or the 'Group')

 

Trading update for the second quarter ended 30 June 2023

 

CANDIDATE AND CLIENT CONFIDENCE YET TO SHOW SUSTAINED IMPROVEMENT

 

Financial and operational highlights

 

 Gross profit (Net fee income)  Q2 2023  Q2 2022   % change  % change (constant currency(*))

 Group                          £99.9m   £112.0m   (11%)     (10%)

 Asia Pacific                   £43.8m   £49.7m    (12%)     (8%)
 Europe                         £32.3m   £31.5m    3%        0%
 UK                             £16.0m   £20.4m    (21%)     (21%)
 Other International            £7.8m    £10.4m    (25%)     (26%)

* Constant currency is calculated by applying prior period average exchange
rates to local currency results for the current and prior years.

 

Group highlights

§ Group net fee income for the quarter down 10%* (down 11% actual)
year-on-year with global market uncertainty continuing to impact both
candidate and client confidence.

§ Tough comparatives against a record second quarter in 2022.

§ 84% (2022: 82%) of the Group's net fee income is now generated by our
international businesses.

§ Group net fee income for the half-year down 5%* (down 4% actual)
year-on-year to £202.3m (2022: £210.5m).

§ Headcount down 3% quarter-on-quarter to 4,280 (31 March 2023: 4,403).

§ Strong balance sheet with net cash of £69.9m as at 30 June 2023 (31 March
2023: £70.5m).

§ During the quarter, the Group purchased and cancelled 818,000 shares at an
average price of £4.15 for £3.4m.

 

Regional highlights

§ Asia Pacific net fee income down 8%* (down 12% actual) to £43.8m (2022:
£49.7m).

o  Net fee income in Mainland China down 37%* year-on-year. The anticipated
economic bounceback from Covid-related disruption earlier this year is yet to
materialise.

o  The strongest rates of net fee income growth were delivered by Indonesia
(up 20%*), Malaysia (up 11%*) and New Zealand (up 8%*).

o  Net fee income in Japan and Australia, the region's largest businesses
declined by 1%* and 17%* respectively.

§ Europe net fee income was flat* (up 3% actual) at £32.3m (2022: £31.5m).

o  A more resilient performance across Europe with record net fee income in
Belgium (up 18%*) and Switzerland (up 13%*). Our newest business in Italy is
performing well.

o  Solid performance across the region's three largest businesses in France
(flat*), Netherlands (down 3%*) and Spain (down 4%*) against record prior year
comparatives.

§ UK net fee income down 21% to £16.0m (2022: £20.4m).

o  Recruitment confidence levels in the UK continued to be impacted by the
knock-on macro-economic effects of a high inflation and high interest rate
environment.

o  Activity levels impacted by lay-offs across the technology sector and
financial services volatility. Legal recruitment remained relatively robust.

§ Other International (the Americas, South Africa and the Middle East) net
fee income down 26%* (down 25% actual) to £7.8m (2022: £10.4m).

o  Trading conditions in the US remained challenging with net fee income down
47%* year-on-year as a result of significant disruption to hiring across both
technology and financial services.

o  South Africa and Mexico performed well, increasing net fee income by 23%*
and 93%* respectively year-on-year.

 

Toby Fowlston, Chief Executive, commented:

 

"As reported in our June trading update, candidate confidence and time to hire
are not yet showing the anticipated signs of sustained improvement. Structural
recruitment market fundamentals including job vacancy levels, salary inflation
and candidate shortages are still holding strong which continues to suggest
that when market confidence recovers there will likely be an increase in
demand and candidate movement across all areas of recruitment.

 

"The Group has a strong and experienced senior management team with a
successful track record of navigating challenging macro-economic conditions
and balancing short-term pressures with longer term growth. We have invested
significantly in Group headcount and global infrastructure over the past two
years and while we are taking a sensible approach to cost reduction, we intend
to protect our strategic core to ensure we can move quickly to take advantage
of opportunities when market confidence returns."

 

The Group will publish its half-year financial results for the period ended 30
June 2023 on 1 August 2023.

 

- Ends -

 

Further information

 

 Robert Walters plc                        +44 20 7379 3333

 Toby Fowlston, Chief Executive Officer

 Alan Bannatyne, Chief Financial Officer

 Williams Nicolson

 Steffan Williams                          +44 7767 345 563

 

About Robert Walters Group

The Robert Walters Group is a market-leading international specialist
professional recruitment group. With over 4,200 staff spanning 31 countries,
we deliver specialist recruitment consultancy, staffing, recruitment process
outsourcing and managed services across the globe. We match highly skilled
professionals to permanent, contract and interim roles across the disciplines
of accountancy & finance, banking, engineering, HR, healthcare,
technology, legal, sales, marketing, secretarial & support, and supply
chain, logistics & procurement. Our client base ranges from the world's
leading blue-chip corporates and financial services organisations through to
SMEs and start-ups. www.robertwaltersgroup.com
(http://www.robertwaltersgroup.com)

 

Forward looking statements

This announcement contains certain forward-looking statements.  These
statements are made by the directors in good faith based on the information
available to them at the time of their approval of this announcement 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.

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