Following the recent trading update, there were no further surprises lurking in PageGroup’s (PAGE) results for the first half of 2019. The recruiter's gross profit increased by 9.5 per cent at constant currencies to £434m on the back of double-digit growth in the Americas and its largest aggregate market comprising Europe, the Middle East and Africa (EMEA). The conversion rate (operating profit as a percentage of gross profit) improved by 0.4 percentage points to 17.4 per cent.
Accounting for almost a fifth of the group total, Asia Pacific gross profit increased by 9 per cent to £81.8m. But with the conversion rate squeezed by 1.3 percentage points to 10.8 per cent, operating profit fell by 4.8 per cent at constant currencies to £8.8m. US-China trade tensions capped gross profit growth at 3 per cent in Greater China (the largest Asian market) following the 1 per cent second-quarter decline.
The group had warned challenging macroeconomic conditions would see full-year operating profit hit the lower end of consensus expectations. Reporting £75.6m for the first half, management is confident the group can meet its £161m target.
HSBC forecasts adjusted pre-tax profit of £160m and EPS of 36.32p for the full year, rising to £188m and 42.92p in 2020.
| PAGEGROUP (PAGE) | ||||
| ORD PRICE: | 456p | MARKET VALUE: | £1.5bn | |
| TOUCH: | 455-456p | 12-MONTH HIGH: | 614p | LOW: 412p |
| DIVIDEND YIELD: | 2.9% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 107p | NET CASH: | £81.7m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2018 | 752 | 67.2 | 15.5 | 4.1† |
| 2019 | 821 | 74.6 | 16.8 | 4.3† |
| % change | +9 | +11 | +8 | +5 |
| Ex-div: | 5 Sep | |||
| Payment: | 9 Oct | |||
| †Does not include special dividend of 12.73p | ||||
