Recruiter Hays suffered a challenging year as recessionary pressures made way for anxieties about public sector cuts - indeed, group like-for-like net fees slipped 21 per cent year-on-year.
As expected, the UK & Ireland division was hit hard - net fee income there fell 26 per cent to £244m. UK public sector frontline services, such as healthcare and education, did see growth, although hiring in construction, property and back-office work dipped. Meanwhile, the Europe & the Rest of the World unit saw fees decrease 12 per cent, while the Asia Pacific business was more resilient - net fees there fell 2 per cent. Overall, temporary placements fared better than permanent ones, but both suffered margin declines - reflecting pricing pressures and a shift towards higher volume contracts. Despite an 11 per cent fall in costs, pre-tax profit - after stripping out a £30.4m Office of Fair Trading (OFT) fine and restructuring costs - fell 53 per cent to £71.1m. Still, the trend seems to be improving - the second half witnessed sequential fee growth of 8 per cent and operating profits increased 23 per cent, with Hays having hiring 200 consultants, predominantly in Asia.
KBC Peel Hunt expects adjusted pre-tax profits of £86.1m for 2011, giving EPS of 4.2p (2009: £71.1m/3.3p).
HAYS (HAS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 98p | MARKET VALUE: | £1.36bn | |
| TOUCH: | 98-99p | 12-MONTH HIGH: | 119p | LOW:83p |
| DIVIDEND YIELD: | 5.9% | PE RATIO: | 204 | |
| NET ASSET VALUE: | 10p* | NET DEBT: | 58% | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2006 | 538 | 193 | 8.70 | 4.35 |
| 2007 | 634 | 212 | 10.2 | 5.00 |
| 2008 | 787 | 264 | 13.4 | 5.80 |
| 2009 | 671 | 151 | 7.72 | 5.80 |
| 2010 | 558 | 29.7 | 0.48 | 5.80 |
| % change | -17 | -80 | -94 | - |
Ex-div:20 Oct Payment:19 Nov *Includes intangible assets of £248m, or 18p a share | ||||
