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New lockdowns cloud Hays outlook, net fees slide on pandemic hit

·1-min read

(Reuters) - Recruitment agency Hays Plc on Thursday posted a steep drop in second-quarter net fees as COVID-19 curbs stymied new hiring worldwide, and said it could not immediately assess the impact of fresh lockdowns in Europe and Britain.

The company, which operates in 33 countries, said overall net fees fell by 19% for the three months ended Dec. 31, compared with a 7% fall last year.

However, the group's net-fee trend has improved from a drop of 34% in the fourth quarter of last year and a 29% fall in the first quarter of the current year.

"Activity in Australia increased after local lockdown restrictions eased, and we saw improvement in Germany across the quarter with signs of increasing business confidence," Chief Executive Officer Alistair Cox said in a statement.

The report follows several months in which professional recruiting firms have flagged signs of recovery across Asia, and comes as fresh restrictions from spiking COVID-19 cases worldwide threaten to halt the return to normalcy.

The staffing company also said it now expects its operating profit for first half to be around 25 million pounds ($34.17 million).

"Second-quarter net fee growth and net cash are well ahead of expectations and H1 EBITA guidance has been significantly raised," Jefferies analysts said in a note.

Shares in the FTSE-250 company, which shed over 20% value in 2020, was up 1.4% in early trade.

($1 = 0.7317 pounds)

(Reporting by Indranil Sarkar in Bengaluru; Editing by Ramakrishnan M.)