Global economic upturn lifts Michael Page profits

Published on Friday 9 July 2010 16:15

Recruitment firm Michael Page International banked profits of £111.5 million in the second quarter, up 33 per cent on a year earlier and 14 per cent on the previous quarter, the group revealed yesterday.

Earnings were boosted by strong overseas markets in areas such as Asia and Latin America, where the firm plans to invest further in new staff.

A flat performance in the public sector, which accounts for less than 10 per cent of Michael Page's business, was offset in areas such as financial services, sales, retail, human resources and legal.

The trend mirrored that of rival Hays, which on Thursday announced that recruitment in the public sector had already slowed as a result of government budgetary cuts and freezes.

UK gross profit for the three months to the end of June was 32.2m, an increase of 14.4 per cent over the 28.1m recorded in the second quarter of 2009.

Chief executive Steve Ingham said: "It is the nature of our business that visibility is short, and the general level of business confidence and economic activity may be threatened by fiscal consolidation in the UK and Europe. However, we are quick to react to changing market conditions.

"Having maintained our presence in all our markets, the strength of our geographic discipline and industry sector diversification, combined with our operational gearing means that our profitability is much improved over last year."

The firm added that it had benefited from its international spread - 70 per cent of the firm's gross profit was generated from outside of the UK - and said the performance had been driven by increased permanent hiring as a result of improved economic confidence.

In Asia Pacific, which represents 16 per cent of group gross profit, second-quarter gross profit topped 18m, an increase of 85 per cent over the 9.7m recorded in the second quarter of last year.

In Michael Page's Europe, Middle East and Africa, region, which accounts for 40 per cent of overall profit, market conditions remained uncertain, the company said, but it added that there were signs of stabilisation and recovery, resulting in a third consecutive quarter of modest sequential growth for the region.

Headcount at the firm's 136 offices increased by 201 during the quarter to a total of 3,860. The figure is also 4.3 per cent higher than staff numbers at the end of June 2009.