PageGroup revealed this morning that profits had grown in its third quarter, but the Brexit vote had taken its toll on its UK business.
Gross profits for the recruiter's third quarter were £158.6m, an increase of 14.1 per cent on a reported basis from the prior year's £139.1m. However, once foreign exchange movements were striped out, the group's gross profits grew by just 1.3 per cent.
The company performed particularly strongly in its Europe, Middle East and Africa region, where gross profits jumped to £66.8m, up 29.4 per cent from £51.6m. On a constant currency basis, this represents an increase of 10.4 per cent.
Shares in the company are trading up 3.1 per cent at 359.7p at time of writing.
Why it's important
Even before June's Leave decision was revealed, many were concerned about the impact Brexit could have on the jobs market. PageGroup's UK performance was lacklustre, with profits falling to £37.8m, down 4.7 per cent from £39.7m.
Although temporary fees remained relatively flat on a global basis, rising just two per cent on a constant currency basis, the company noted the market grew significantly in the UK during the third quarter of the year, as firms opt for shorter term contracts during uncertain times.
What PageGroup said
Chief executive Steve Ingham said:
With the prevailing uncertainty in the UK, the challenges in some of our other larger markets and the unpredictable nature of the current cycle, we remain cautious in our short-term outlook. However, we will continue to progress our strategic projects...as well as driving profitable growth and taking advantage of growth markets. As always, we remain able to respond quickly to any changes in market conditions.
What analysts said
Analysts at Liberum were upbeat about the recruiters's performance, calling the UK decline "impressive", "given the environment and the group's gearing to permanent".
Currency swings may have bumped up the recruiter's figures but Brexit has dampened the underlying work in the UK market.