Hays CEO steps aside as recruitment firm’s half year profits fall amid fears of tougher labour market
London-listed recruitment firm Hays is on the hunt for a new chief executive, as the firm sees net fees rise 15 per cent but profits fall during the last half of 2022.
Alistair Cox, said he was stepping down after 15 years at the helm, however he will remain to steer the company until a “suitable candidate” has been appointed and a handover has taken place.
“It has been an honour and a privilege to lead Hays for over 15 years and I am extremely proud of, and grateful to, my colleagues for everything we have achieved together, he said.
In the first six months ending 31 December, Hays saw net fees rise 15 per cent to £651.9m, up from £565.3m the previous year.
Despite the boost in fees, pre-tax profit for the firm slipped to 4 per cent to £94m down from £97m in the previous quarter last year.
Looking across activity in its UK and Ireland operations, the group also saw operating profit down 16 per cent to £15.2m.
The firm’s German branch saw fees soar a record high of 24 per cent; and operating profit up 17 per cent to £43.2m.
“Despite clear economic uncertainties, we delivered record half-year fees in 19 countries, including our largest market of Germany, as well as in key strategic areas such as technology, engineering and our enterprise client division,” Cox said, commenting on the results.
He continued: “We achieved this through our actions to increase fee margins in skills short sectors, together with our shift towards the most in-demand markets and supported by wage inflation globally.
“Our largest business of temp and contracting performed well, while perm fees and volumes decreased sequentially as market conditions tightened in many markets through the half-year.”
“There was nothing wrong with the half-year figures themselves, as they met expectations with a 12 per cent increase in net fees, a small drop in pre-tax income and an unchanged dividend,” Russ Mould, investment director of AJ Bell told City A.M.
He continued: “However, investors have latched onto the comments about ‘increasingly tougher markets,’ with an eye on the second half of the company’s financial year, and will have also been unsettled by the unexpected news that the search is on a successor to longstanding CEO Alistair Cox.
“He has led the firm for 15 years and helped to take it from a UK-focused operation to a global one. Although Mr Cox will stay on until an appropriate candidate has been identified and hired, investors may look at this announcement with some concern, because long-time CFO Paul Venables retired last autumn, even if the success there was seamless, as group financial controller James Hilton stepped up.”
Hays has 33 offices, globally and is headquartered in London.