Pagegroup Plc · LSE:PAGE
Pagegroup — Q2 2016 Earnings Presentation
27 slides from Pagegroup's earnings presentation, 2016
Slide 1: Second Quarter and First Half 2016 Trading Update
Second Quarter and First Half 2016 Trading Update
Slide 2: Agenda
Agenda Financial Review Regional Review Business Strategy Summary and Outlook
Slide 3: Financial Review
Financial Review
Slide 4: Trading Performance
Trading Performance Reported (£m) Constant 2016 2015 % % Q2 156.9 145.3 +8.0% +3.7% H1 299.2 280.9 +6.5% +3.6% • Q2 Gross Profit +3.7% vs Q2 2015 in constant currency • In reported rates Q2 Gross Profit +8.0% • In constant currency, Q2 Gross Profit was £150.6m (-£6.3m on reported rates) • Financial
Slide 5: Permanent vs Temporary – Year-on-Year Gross Profit
Permanent vs Temporary – Year-on-Year Gross Profit Reported (£m) Constant Q2 2016 2015 % % Permanent 121.0 113.2 +6.9% +2.9% Temporary 35.9 32.1 +11.9% +6.5% Ratio (Perm : Temp) 77:23 78:22 Reported (£m) Constant H1 2016 2015 % % Permanent 228.3 218.2 +4.6% +2.0% Temporary 70.9 62.7 +13.1% +9.3% Rat
Slide 6: Q2 Permanent : Temporary – Ratio Analysis
Q2 Permanent : Temporary – Ratio Analysis 12% 13% 27% 30% ASIA PAC AMERICAS EMEA UK 70% 73% 87% 88% 16% 40% 84% 60% Temp Perm 6
Slide 7: Discipline Overview – Year-on-Year Gross Profit
Discipline Overview – Year-on-Year Gross Profit Reported (£m) Constant % of Q2 2016 2015 % % Group Finance & Accounting 39% 60.9 56.9 +7.0% +3.0% Legal, Technology, HR, Secretarial 22% 34.7 30.8 +12.6% +7.7% and Healthcare Engineering, Property & Construction, Procurement & 19% 30.5 28.5 +7.2% +2.6%
Slide 8: Headcount
Headcount Q2 2016 Q1 2016 Movement % Fee earners 4,529 4,496 33 +0.7% Support staff 1,390 1,381 9 +0.7% Total headcount 5,919 5,877 42 +0.7% Ratio 77:23 77:23 • Fee earner headcount responds to trading conditions, +34 in EMEA, -31 in the UK and Asia Pacific combined • Support staff increase (+9) par
Slide 9: Headcount and Reported Gross Profit
Headcount and Reported Gross Profit Total headcount increased 0.7% vs. Q1 2016 to 5,919 (Q1 2016: 5,877) 9
Slide 10: Regional Review
Regional Review
Slide 11: Q2 Regional Overview - Year-on-Year Gross Profit
Q2 Regional Overview - Year-on-Year Gross Profit Reported (£m) Constant % of Q2 2016 2015 % % Group EMEA 43% 67.5 55.1 +22.7% +13.6% UK 24% 38.3 39.2 -2.3% -2.3% Asia Pacific 20% 30.6 30.2 +1.3% -3.3% Americas 13% 20.5 20.8 -1.5% -1.1% Group Total 100% 156.9 145.3 +8.0% +3.7% 11
Slide 12: EMEA (43% of the Group) - Year-on-Year Gross Profit
EMEA (43% of the Group) - Year-on-Year Gross Profit Reported (£m) Constant 2016 2015 % % Q2 67.5 55.1 +22.7% +13.6% H1 129.1 109.1 +18.5% +12.0% Headcount at 30 June 2016: 2,427 (31 March 2016: 2,380) • Record quarters from Austria, Belgium, Italy, Portugal, South Africa, Spain and Sweden • Michael
Slide 13: United Kingdom (24% of the Group) - Year-on-Year Gross Profit
United Kingdom (24% of the Group) - Year-on-Year Gross Profit Reported (£m) 2016 2015 % Q2 38.3 39.2 -2.3% H1 74.8 75.7 -1.5% Headcount at 30 June 2016: 1,466 (31 March 2016: 1,472) • Michael Page (78% of the UK) -3% • Page Personnel (22% of the UK) +2% • Temporary recruitment (+3%) more robust than
Slide 14: Asia Pacific (20% of the Group) - Year-on-Year Gross Profit
Asia Pacific (20% of the Group) - Year-on-Year Gross Profit Reported (£m) Constant 2016 2015 % % Q2 30.6 30.2 +1.3% -3.3% H1 56.5 56.0 +1.0% -2.6% Headcount at 30 June 2016: 1,176 (31 March 2016: 1,200) • Asia (14% of Group and 71% of Asia Pacific) -7% • Greater China (59% of Asia) -9% • Record quar
Slide 15: Americas (13% of the Group) - Year-on-Year Gross Profit
Americas (13% of the Group) - Year-on-Year Gross Profit Reported (£m) Constant 2016 2015 % % Q2 20.5 20.8 -1.5% -1.1% H1 38.8 40.1 -3.3% -0.8% Headcount at 30 June 2016: 850 (31 March 2016: 825) • North America (7% of the Group and 56% of Americas) -2% • US -1%, challenging Financial Services market
Slide 16: Business Strategy
Slide 17: Strategy – Diversification
Strategy – Diversification • By Geography: • Platform wider now than in 2007: 35 countries (25 in 2007) • Significant investment in emerging markets: Asia and LatAm c.1,100 fee earners (c.200 at start of 2007) • By Brand: • Page Personnel now c.30% of the Group (c.17% in 2007) • Further deployment g
Slide 18: Strategy – Structural Opportunities
Strategy – Structural Opportunities • Overall size of global recruitment market • Market growing as recruitment further penetrates emerging markets • Development of Temporary recruitment • Temporary recruitment starting in emerging markets such as Latin America • Higher salary level contracting grow
Slide 19: Focus – Productivity and Efficiency
Focus – Productivity and Efficiency • Continuing productivity improvements due to deployment of PRS • Automatic parsing and uploading of CVs into PRS • Streamlined searching across internal and 3rd party sites; website, job boards and social media • Real time job board and candidate response trackin
Slide 20: Ability to react to market conditions – UK
Ability to react to market conditions – UK • Proven track record of managing profitability through economic downturns • Volatility of EBIT Conversion is less than movement in the GP Growth rate as we manage headcount and costs in response to trading conditions • Conversion Rate of 30% won’t be achie
Slide 21: Summary and Outlook
Summary and Outlook
Slide 22: Summary
Summary • Q2 Gross Profit: +3.7% in constant currency and +8.0% in reported rates Summary • Impact of FX: Q2 reported Gross Profit increased by 4.3 percentage points or c. £6m H1 reported Gross Profit increased by 2.9 percentage points or c. £8m, reported Operating Profit by c. £2m • Headcount: +42
Slide 23: Outlook
Outlook • Trading conditions anticipated to remain challenging in the short term Summary Outlook - Uncertainty in the UK following the EU Referendum - Europe positive, Benelux +30%, Southern Europe +25% - Financial Services market in New York particularly tough - Brazil expected to remain challengin
Slide 24: Diversity & Inclusion — Our progress at PageGroup
Diversity & Inclusion — Our progress at PageGroup Jan-June 2016 Launched D&I section on all Delivered sessions across websites to share information the UK on effective parenting and promote progress — strategies in partnership with including PageGroup is people Educating Matters video © EDUCATING Ee
Slide 25: Cautionary Statement
Cautionary Statement This presentation contains certain statements that are neither reported financial results nor other historical information. The information contained in this presentation is not audited, is for personal use and informational purposes only and is not intended for distribution to,
Slide 26: Year-on-Year Gross Profit Growth Rates
Year-on-Year Gross Profit Growth Rates 2014 2015 2016 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 EMEA +5.7% +5.1% +11.2% +12.5% +12.1% +11.4% +13.0% +10.6% +10.3% +13.6% UK +8.1% +11.1% +13.7% +11.0% +11.3% +12.8% +12.5% +2.4% +0.0% -2.3% Asia Pacific +1.3% +14.2% +11.1% +10.8% +10.8% +5.6% +5.3% -1.3% -2.0% -3.
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