Adecco outperforms rivals in tough quarter, but warns weak hiring to persist

Reuters

Adecco outperforms rivals in tough quarter, but warns weak hiring to persist

4:53 sáng giờ GMT, 6 Tháng 8 2024

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Slight miss on net profit and sales in tough Q2, but EBITA beats

Sees Q3 revenue decline in line with Q2, weak hiring to persist

Shares rise 2.5% as Adecco's results outperform peers

Recasts with shares, adds bullet points, EBITA beat paragraph 3, analyst comment paragraph 6, peers in paragraphs 7-8

By Andrey Sychev

Aug 6 (Reuters) -Adecco's ADEN.S second quarter results outperformed those of global rivals in the tough staffing market, sending its shares higher on Tuesday, even as the Swiss group warned that weak hiring trends would persist in the third quarter.

The fortunes of Adecco, which supplies temporary and permanent staff to offices, factories and logistics hubs, are keenly watched for providing insight into the health of the broader economy.

Adecco's earnings before interest, tax and amortisation (EBITA) were 179 million euros ($195.5 million) in the quarter, unchanged from last year on an organic basis and ahead of the 173 million expected by analysts' consensus.

Both revenue and net income fell 2% in the same period, when adjusted for currency movements, trading days and acquisitions.

Among the worst performing regions by sales were France, Britain, the Nordics and North America, where the tech and automotive sectors were notably weak, Adecco said.

"Organic revenue decline was 2% slightly more than anticipated but still well above market trends and peers," Vontobel analyst Michael Foeth wrote in a note.

Quarterly revenues at rivals Randstad RAND.AS and ManpowerGroup MAN.N fell 7.5% and 6.9%, respectively.

British peers Robert Walters RWA.L, Page Group PAGE.L and Hays HAYS.L have also recently warned of tough hiring market conditions in the near term, as workers avoid switching jobs and companies take longer to fill vacancies amid slowing economies.

Adecco's results were helped by increased cost cuts that reached 162 million euros by the end of June, above its 150 million euro target, it said.

The company added it expects July-September revenue to decline at a similar pace to the second quarter, while it continues to focus on cutting cost to shield its profits.

($1 = 0.9155 euros)

Reporting by Andrey Sychev and John Revill; editing by Milla Nissi

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