Anyone who has been following our recent coverage of Hays (HAS) will not be surprised at the announcement of the recruiting giant's inaugural special dividend. The company has a policy of paying out net cash above £50m to shareholders. In respect of these full-year results this means an additional payout of 4.25p a share, bringing the total to 7.47p a share and the historic yield to a respectable 4.3 per cent. This was underpinned by a net cash inflow from operating activities of £134m, up from £103m last year. Group finance director Paul Venables stressed that investors should view this as the first of a series of special dividends, potentially making for an attractive income play.
Hays' full-year performance followed a familiar pattern. Europe led the other geographies with 12 per cent net fee growth on a like-for-like basis. Germany and France saw headcount increases of 24 per cent and 12 per cent, respectively, reflecting their perceived importance to future growth.
The UK continued to struggle with a net fee decline of 7 per cent. Mr Venables reported signs of improvement for a division that may even generate modest fee growth at the next update. But with 80 per cent of operating profit coming from elsewhere in the world, it looks like it will be a supporting player for the near term.
Consensus forecasts are predicting adjusted EPS of 10.7p in 2018, rising to 11.6p in 2019 (9.5p in 2017).
| HAYS (HAS) | ||||
| ORD PRICE: | 175p | MARKET VALUE: | £2.53bn | |
| TOUCH: | 175.2-175.4p | 12-MONTH HIGH: | 176p | LOW: 123p |
| DIVIDEND YIELD: | 1.8% | PE RATIO: | 18 | |
| NET ASSET VALUE*: | 41p | NET CASH: | £112m | |
| Year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 3.70 | 119 | 5.1 | 2.50 |
| 2014 | 3.68 | 132 | 6.1 | 2.63 |
| 2015 | 3.84 | 156 | 7.4 | 2.76 |
| 2016 | 4.23 | 173 | 8.5 | 2.90 |
| 2017** | 5.08 | 205 | 9.7 | 3.22 |
| % change | +20 | +18 | +14 | +11 |
| Ex-div: | 5 Oct | |||
| Payment: | 17 Nov | |||
| *Includes intangible assets of £242m, or 17p a share **Excludes special dividend of 4.25p a share | ||||
