Aug. 7, 2023 -- PageGroup plc (“PageGroup”), the specialist professional recruitment company, announces its unaudited half year results for the period ended 30 June 2023.

“The Group delivered a robust H1 performance against a record first half in 2022. EMEA delivered the standout result, delivering record H1 gross profit against a particularly strong comparator across the region. However, tough market conditions continued in Asia, the UK and the US. Overall, Group gross profit declined 4.4% in constant currencies against H1 2022. We delivered Group operating profit of £63.9m at a conversion rate of 12.1%, compared with 21.4% in H1 2022.” CEO Nicholas Kirk said in a statement.

H1 Summary

Group operating profit of £63.9m (H1 2022: £115.3m)

Conversion rate** decreased to 12.1% (H1 2022: 21.4%)

Gross profit per fee earner down 5.8% on H1 2022 to £79.7k (H1 2022: £82.8k)

Total headcount decreased by 448 (5.0%) to 8,572 at the end of June

Strong Balance Sheet, with net cash of £97.9m (H1 2022: £136.2m)

Interim dividend up 4.5% to 5.13 pence per share, totalling £16.2m

Special dividend of 15.87 pence per share, totalling £50.0m

Outlook unchanged: Full year operating profit expected to be in line with previous guidance

Other Items

Net interest expense of £0.5m was broadly consistent with H1 2022 (£0.8m). The effective tax rate for the first half was 31.9% (H1 2022: 28.8%), with the increase on the prior year due to the change in the UK tax rate from 19% to 25% from April 2023.

For the six months ended 30 June 2023, basic earnings per share and diluted earnings per share were both 13.6p, representing a decrease of 47% on 2022 (2022: basic earnings per share 25.6p; diluted earnings per share 25.5p).

Cash Flow

The Group started the year with net cash of £131.5m. In H1, £83.7m was generated from operations due to H1 Operating Profit as well a net outflow of working capital due to the stronger performance in temporary recruitment. Tax paid was £27.3m and net capital expenditure was £11.3m. During the first half, £0.8m was received from exercises of share options (2022: £0.3m), £17.5m was spent on the purchase of shares into the Employee Benefit Trust (2022: £14.8m) and dividends of £33.9m were paid to shareholders (2022: £32.7m). As a result, the Group had net cash of £97.9m at 30 June 2023 (30 June 2022: £136.2m).

Capital Allocation Policy

It is the Directors’ intention to continue to finance the activities and development of the Group from retained earnings and to maintain a strong balance sheet position.

The Group’s first use of cash is to satisfy operational and investment requirements, as well as to hedge its liabilities under the Group’s share plans. The level of cash required for this purpose will vary depending upon the revenue mix of geographies, permanent and temporary recruitment, and point in the economic cycle.

Its second use of cash is to make returns to shareholders by way of an ordinary dividend. The Group's policy is to grow the ordinary dividend over the course of the economic cycle in a way that we believe we can sustain the level of ordinary dividend payment during downturns, as well as increasing it during more prosperous times.

Cash generated in excess of these first two priorities will be returned to shareholders through supplementary returns, using special dividends and/or share buybacks.

The Board has announced an interim dividend of 5.13 pence per share, an increase of 4.5% over last year. In addition, in line with our policy of returning surplus capital to shareholders, the Group is pleased to announce today a special dividend of 15.87 pence per share (2022: 26.71 pence per share) totalling £50.0m. Taking these two dividend payments together, this amounts to a cash return to shareholders of £66.2m. This is in addition to the 2022 final dividend paid in June of £33.9m, meaning a total of £100.1m, or 31.76 pence per share, returned to shareholders in 2023.

The special dividend will be paid, as in previous years, at the same time as the interim dividend on 13 October 2023 to shareholders on the register as at 1 September 2023.

During the first half, the Group made purchases of £17.5m of shares into the Employee Benefit Trust to hedge its exposure under the Group’s share plans (2022: £14.8m).

About PageGroup

PageGroup is a global recruitment and talent management company. It was founded in 1976 and is headquartered in the United Kingdom. PageGroup operates through a network of specialized recruitment brands, including Michael Page, Page Personnel, and Page Executive. The company provides recruitment services for various sectors and industries, helping clients find qualified professionals for permanent, temporary, and contract positions. PageGroup operates in over 36 countries and has a strong presence in Asia-Pacific, Europe, and the Americas.

SOURCE PageGroup