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.

dealerdear you dont understand their RNS results statement for the first quarter to 31/3/08?

It will not produce that profit performance in the 2nd quarter as massive job cuts in the financial sector are underway. Sell at 260p

no you misunderstand, I was repling to hlyeo's post 5

Job cuts create opportunities to place job seekers elsewhere.

It's tougher times for virtually all the recruitment companies at present. The upside for Page will be that some smaller competitors will go to the wall.

MPI has fallen today...more to come as recruitment is not in demand now, especially in the City.

Wow! "MPI has fallen today". What an incredible scoop when the FTSE is down 135 as I write. I can't wait for the next awe-inspiring and insightful headline. Perhaps it will be; "Fish swims!".

Is there a bid situation

MPI has been oversold to 230p...it is now a BUY!

For once I agree with you.

Only if you think the employment market will hold up, and do not be fooled that it is boyant out here in Asia because it if quite the opposite. The SP has only fallen to the pre bid price, so in line with the rest of the market. Other than a dead cat bounce in response to todays sell off not a long term buy in my opinion

http://www.bloomberg.com/apps/news?pid=20601102&sid=a7Xe0Jp0kDzU&refer=uk

oversold IMHO

U.S. November job losses steepest since 1974 - AFX


WASHINGTON, Dec 5 (Reuters) - U.S. employers axed payrolls by a shocking 533,000 in November for the weakest performance in 34 years, government data on Friday showed, as the recession inflicted a mounting toll on the U.S. labor market.

The Labor Department said the unemployment rate rose to 6.7 percent last month in the highest reading since 1993, compared with 6.5 percent in October, after widespread losses across the country's major industry sectors.

November's job losses were the steepest since December 1974, when 602,000 jobs were shed, and were much worse than forecast by analysts polled by Reuters who had predicted a reduction of 340,000 jobs.

In addition, October's job losses were revised to show a cut of 320,000, previously reported as a 240,000 loss, while September's losses were revised to a loss of 403,000 from down 284,00.

That meant 199,000 more jobs were lost in September and October than previously thought and the total reduction in U.S. nonfarm payrolls for last three months was 1.256 million, with almost 2 million shed in the year so far.

Service-providing businesses alone shed 370,000 jobs in November, following a loss of 153,000 jobs the month before.

The length of the workweek slipped to 33.5 hours, the shortest since records began in 1964, a Labor Department official said.

240p is a good time to take profit now.

Michael Page sees market deteriorating - MoneyAM


Recruitment specialist Michael Page International today revealed a 5% fall in pretax profit to 140.1m for the year ended December 2008, on revenue up 8% in constant currency terms to 972.8m. Dividend was maintained at 8p per share.

The firm recorded record levels of revenue and gross profit. Gross profit from permanent placements grew 14% and from temporary placements grew 20%

Temporary placements gross margin was maintained at 24.2%.

Cash generated from operations was up 25% to 185.2m (2007: 148.7m) and the company had net cash at the year end of 94.3m (2007: 10.3m).

Michael Page said it has seen further deterioration in market conditions, with gross profit down 30% (down 38% at constant currency) in first two months of this year.

Steve Ingham, CEO, said: 'Looking at 2008 as a whole, Michael Page delivered a good set of results. However, it was a year of two halves with a strong first half being followed by a progressively weaker second half as the economic environment deteriorated.

'Given the current uncertainty over the economic outlook, it is extremely difficult to predict the performance of our business in the short term. Whilst, as in previous downturns, we will aim to maintain our market presence, we also recognise the need to manage our cost base to reflect current trading. Our strategy of diversifying by both specialist discipline and geography has increased our resilience and our balance sheet has never been stronger. We believe the Group is well positioned to benefit when market conditions improve and we remain confident in the longer term prospects of the Group.'

Michael Page quarter gross profit down 45%


LONDON (ShareCast) - Recruitment firm Michael Page (LSE: MPI.L - news) saw gross profit in the second quarter fall 45% and warned of a challenging third quarter.

The group also said headcount has been decreased by 429 (10.4%) in the quarter to 3,705 at June 2009, which is 33.1% lower than the peak at 30 June 2008. The group said the headcount reduction in the last 12 months has reduced cost base and enabled the group to remain profitable in the first half of 2009.

Second quarter gross profit came in at 83.8m against 152.4m the same period last year. Operating profit from trading activities was similar to the first quarter at around 3m.

"We anticipate a challenging third quarter as we enter into the seasonally quieter summer period, both in Continental Europe, which was later into the downturn, and in the UK," said chief executive Steve Ingham.

EMEA gross profit fell 45.7% to 38.2m, while UK gross profit slipped 42% to 28.1m. Asia Pacific and Americas gross profit fell 50.4% and 44.5% respectively.

"While market conditions generally continued to weaken during the second quarter, the rate of decline in the UK, our largest country, has slowed and gross profit in the second quarter was at a level similar to that of the first quarter," said the group.

"We remain confident that, with our strong balance sheet, leading brand and experienced management team, we can maintain our market presence and continue to gain market share," it added.

Michael Page finance director Stephen Puckett sells shares ahead of profit warning

The finance director of Michael Page sold 2.25m of shares just over two weeks before yesterdays profit warning from the recruitment company.

Stephen Puckett and his wife Amanda sold close to 600,000 shares in the company, according to a stock exchange disclosure. News of the sales could spark scrutiny from investors and City analysts.

Michael Page announced in July that Mr Puckett would be leaving for personal reasons, though no date has been set.

He is leaving so in that sense its justified but it is rather close to a major profits warning, said Kevin Lapwood, an analyst covering the stock at Seymour Pierce.

In a separate development, Charles-Herni Dumon - managing director of Michael Page's business in continental Europe and the Americas - sold 130,000 shares for 475,000 just days before Mr Puckett's sales. Mr Dumon has previously sold shares on a regular basis.

Michael Pages share price fell 19.1 or 5.2pc to 345.9p yesterday after the group warned that its full-year profits would be marginally below the bottom end of market expectations. Investec analyst Robert Morton said yesterday: "We will clearly be reducing our forecasts to reflect the slowdown."

Smells a bit funny.

The number of people placed in permanent jobs has fallen at the sharpest rate since July 2009, according to the study by the Recruitment and Employment Confederation and KPMG, published today.

On a scale where anything above 50 represents an increase in hiring, the reports jobs index reached 48.2 in November, down from 49.7 in October and way below its pre-credit crunch peak of 64.1.

The report warned the growth in permanent job vacancies eased back as employers became increasingly concerned over the eurozone crisis and global growth prospects.

The rate of growth for temporary jobs also scaled back from October, meaning pay pressures were subdued across permanent and agency staff.

Bernard Brown, partner at KPMG, said uncertainties in the European market could send unemployment soaring to beyond 3m, up from its current 17-year high of 2.6m.