Hays recruitment profits jump as Asia business grows
Recruitment firm Hays has reported a 50% jump in underlying profits driven by rapid overseas growth.
The net value of fee income in its 2010-11 financial year rose 18% on a like-for-like basis, but that figure masked large regional differences.
In Asia, net fees rose 50%, whereas in the UK - which only comprises a third of its business - they fell 1%.
Bottom line profits before tax nearly quadrupled to £111m, thanks to a £24m cut in a regulatory fine.
The Office of Fair Trading had fined Hays £30.4m in 2009 for price fixing, but the amount has been reduced on appeal.
Hays' share price rose 3.1% in early trading in London following the announcement, outperforming the broader market, which fell slightly.
The weak UK result was due to a 35% contraction in income from state sector hiring.
Net fees from private business employers in the UK rose a much healthier 19%, although the firm said this growth rate softened in the last few months.
"Our international performance was excellent... with the majority of our overseas operations trading at record levels," said chief executive Alistair Cox.
"The UK market has been tougher, particularly as recruitment activity in the public sector has dropped significantly over the year.
"The private sector grew strongly in the first half, but growth slowed as the year progressed."
The company attributed the slowdown to tougher market conditions in banking and City-related businesses.
Other international businesses doing particularly well included Brazil (up 60%) and Germany (up 37%).
The firm launched new operations in the US, Mexico and Colombia during the year.