Recruiter Hays (HAS) reported a 2 per cent drop in operating profit for the full year as it battened down the hatches against testing market conditions. The Asia Pacific region was particularly challenging, with net fees down 13 per cent as prospects in Australia were dented by weakness in resource and mining activity, and market conditions in Asia were lacklustre.
But followers of the stock who have been pinning their hopes on a recovery in the UK job market will be encouraged to hear that trading in the second half showed some signs of improvement. Indeed, net fee income in the UK returned to year-on-year growth. "We are starting to see a number of positive signs coming through in the UK market; as every week goes by, it feels more sustainable," says chief executive Alistair Cox.
The UK and Ireland business moved back into the black over the full year as a result of cost-cutting and Mr Cox says that the focus is no longer on taking out costs, but instead on driving net fees to capitalise on the nascent recovery in the UK market and return the division to being a key profit contributor for the group.
Broker UBS has trimmed its 2014 EPS estimate by 2 per cent to 5.66p (5.14p in 2013), primarily due to recent Australian dollar weakness.
HAYS (HAS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 101p | MARKET VALUE: | £1.42bn | |
| TOUCH: | 101.1-101.2p | 12-MONTH HIGH: | 108.8p | LOW: 67p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 15p* | NET DEBT: | 49% | |
| Year to 20 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 671 | 151 | 7.72 | 5.80 |
| 2010 | 558 | 30 | 0.48 | 5.80 |
| 2011 | 672 | 111 | 5.19 | 5.80 |
| 2012 | 734 | 122 | 5.47 | 2.50 |
| 2013 | 719 | 119 | 5.14 | 2.50 |
| % change | -2 | -3 | -6 | - |
Ex-div: 9 Oct Payment: 15 Nov *Includes intangible assets of £222m, or 16p a share | ||||
