Michael Page shrugs off market turmoil - October 4 2007

Steve Ingham, chief executive of Michael Page International, said on Thursday that the turbulence in financial markets had had little impact on the professional recruitment companys business.

He was speaking after reporting a 38.5 per cent increase in gross profits to 123.4m in the three months to the end of September.

Mr Ingham said that in September across its London, New York and Hong Kong offices, it reckoned it had lost 10 fees because banks had cancelled or put on hold a job search. In the same month it had placed 4,000 people in permanent jobs across the group.

He said: Notwithstanding the recent developments in specific banking sectors, we continue to experience strong demand for talent around the globe and are confident in the ongoing prospects for Michael Page.

The groups reliance on finding jobs for investment banks is relatively small, with banking and financial services accounting for 7 per cent of its business. However, analysts have raised concerns that problems in the banking sector might spill over into other areas of the economy.

Mr Ingham said that investors and analysts ask about MPIs banking business, because they are in banking themselves and see it first hand. But he said the other 93 per cent of the groups business had suffered no impact from any news in the financial sector.

In a trading update for its third quarter, MPI said it had added 10 per cent, or 450 people, to its own staff during the three months taking the headcount to 4,777. The group adds people as it experiences increased demand in existing offices, opens new ones or diversifies into recruiting people for different industry segments.

Mr Ingham said the number had been slightly inflated by the 65 graduates it had taken on during September in the UK.

In the UK, its oldest and most mature market, MPI said gross profits rose 19.9 per cent in the quarter to 40.9m. MPI said it continued to experience good levels of activity across all disciplines and regions. In the first half of the year the growth had been 21 per cent.

Mr Ingham said he was particularly pleased by the performance of the French business, where the growth rate was accelerating, and reached 41 per cent in the third quarter. France makes up a third of MPIs Europe, Middle East and Africa division, which increased third-quarter gross profit by 59.7 per cent to 48.4m.

He said there were enormous growth opportunities in the EMEA region and MPI was on fire in that market.

MPI achieved strong growth in its newer regions, with gross profits from Asia-Pacific up 27.8 per cent to 15.5m, helped by the restructuring of the business in Australia. In the Americas, third-quarter gross profit rose by 81.1 per cent to 10.6m.

Mr Ingham said that while the recruiting industry was competitive in Australia, in other areas it was an undeveloped business.

Profit increases in all its international businesses would have been greater but for the effect of translation into a strengthening sterling.

During the quarter MPI took advantage of a weaker share price, hit by concerns that turbulence in financial markets would eventually hit recruitment, and bought and cancelled 3.2m shares at an average price of 476p costing of 15m. The total bought back for the year so far is 11.5m shares at an average price of 519p, costing 59.7m.

In opening trading the shares slipped 2p to 434p. In July they peaked just below 600p.

reckon this survived quite well today, did you get the bargain basement of around 350 gib??

LONDON (ShareCast) - In spite of Michael Page (LSE: MPI.L - news) 's profit warning on Monday morning, analysts still seem to have mixed opinions about the recruitment firm.

Chief Executive Steve Ingham said in a statement that the start of the second half has been challenging, as expected, due to tough year-on-year comparables and the ongoing backdrop of economic uncertainty.

However, with market confidence likely to remain "poor for the foreseeable future", he said that full-year operating profit would be slightly below current expectations.

The shares, which had sunk to an intraday low of 343.8p early on, were trading just 0.6% lower at 362.9p by the afternoon.

Seymour Pierce reiterated its 'sell' call on the shares after downgrading its full-year earnings before interest and tax (EBIT) forecasts for 2012 and 2013 by around 12% each.

The broker said that the stock trades at 26.2 times prospective earnings which is "too high in our view given the continued challenging economic backdrop". Its (Euronext: ALITS.NX - news) target price remains at 320p.

Investec (EUREX: INVF.EX - news) recommends to keep 'hold' of the shares, saying that the combination of the current rating, downgrades and exposure to the sluggish European markets means Michael Page looks "fully valued". Its target price remains at 360p.

Meanwhile, Jefferies decided to stay more positive and maintained a 'buy' rating for the stock though it did cut its target price slightly.

"We believe the medium-term growth opportunity is intact and, even with modest global economic growth, see upside to 460p [target price down from 475p previously] on mid-cycle assumptions."

FULL YEAR AND Q4 2012 TRADING UPDATE

FULL YEAR HIGHLIGHTS

· Full year 2012 gross profit of £526.8m, a decrease of £26.9m or -1.5% in constant currencies (-4.9% in reported) on 2011

· Full year 2012 operating profit from trading activities is expected to be in the region of £65m1 (2011: £86.0m)

· Continued investment 4 new offices and 2 new country openings during 2012. Now 164 offices in 34 countries

· Strong balance sheet net cash c. £58m at 31 December 2012 (31 December 2011: £58.2m)

· Headcount:5,099 at 31 December 2012, reduced by 187 (-3.5%) since the start of the year and by 156 (-3.0%) in Q4 2012

A tad late!

Investec Hold 433.60 430.00 385.00 420.00 Upgrades

MPI looks like its rec'ng from the jul/aug weakness.Out of the trading range channel I d be looking to buy at 453p.