PageGroup Slides After Hinting at Slowdown in Hiring in Ju
2022.08.08 18:46
By Geoffrey Smith
Investing.com — Shares in PageGroup (LON:PAGE) slumped on Monday in London after the recruitment group said it had taken longer to fill jobs in some of its markets in July.
The news raised fears that the jobs boom that has fueled its recent growth is ending, although the company still said its full-year operating profit would be in line with market consensus forecasts.
“We recognise the heightened degree of global macro-economic and geo-political uncertainty, particularly with regards to increasing inflation around the world,” Page said in one of the more gentle warnings out of London-listed companies in recent weeks. “In July, we noted a slight slowing in time to hire in some of our markets, and we continue to closely monitor our forward-looking (key performance indicators).”
The words of caution came alongside a set of half-year results that amply illustrated how well the recruitment sector has fared in a labor market where demand for talent is far outstripping available workers in many sectors. Revenue rose 27% to 977.3 million pounds ($1.18 billion), while gross profit increased 33% to 538.9 million and operating profit rose 79% to 115.3 million. Permanent placements, on which the group makes over three-quarters of its profits, accounted for a rising share of overall placements at 44%, compared to 41% a year earlier.
North America, in particular, delivered a record first half, with U.S. revenue up 43% in constant currencies. Property and Construction, its largest segment in the U.S., delivered growth of 53%, albeit that benefited from a weak comparative quarter a year earlier. It also reported strong growth in Technology Healthcare & Life Sciences.
Page’s announcement comes one working day after the July U.S. employment took markets by surprise with another 528,000 rise in nonfarm jobs, suggesting that the hiring boom still has legs despite the Federal Reserve’s efforts to cool the labor market down.
The group also announced a special dividend of 26.7 pence a share for the second year running, along with a 4.5% increase in its regular dividend to 4.9 pence a share. Total payouts for 2021 thus totaled 41.9 pence a share, or more than 10% of its price as of 11 AM ET (1500 GMT).
