Second profit warning from Michael Page

Recruitment firm Michael Page has issued its second profit warning in less than a year after telling investors that trading conditions look set to remain challenging for the foreseeable future.

The company, which has 23 per cent of its business in the UK, reported profits of £126.5 million for the third quarter, a drop of 11.3 per cent compared with the same period last year.

Its largest division – which covers the beleaguered eurozone, along with the Middle East and Africa – saw gross profits drop 16 per cent to £49m, while UK profits were 10.9 per cent lower at £29.5m as trading conditions remained “tough” and the Olympics affected activity levels.

Chief executive Steve Ingham said activity in most regions improved towards the end of the third quarter, but he expects the final three months of the year to be challenging, “with economic conditions and market confidence likely to remain poor for the foreseeable future”.

Michael Page, which has been affected by major cutbacks in the banking sector over recent years, said it expected operating profits for the financial year to be “slightly below” current City forecasts of just under £68m.

Broker Seymour Pierce, which has a “sell” rating on the recruitment group’s shares, slashed its full-year profit forecast by 12 per cent to £64.4m.