Hays Q1 fee income falls against record comparator

Recruitment firm Hays said on Thursday that first-quarter fee income had dropped due to a tough record quarter comparator and a weakening of the Australian dollar versus sterling.

Hays said group fees were down 7% in the three months ended 30 September, as expected. On an actual basis, net fees decreased by 9%, with a softening Australian dollar presenting an FX headwind.

It delivered a "resilient performance" in temp placings, with fees flat and volumes broadly stable through the quarter. Permanent, however, was down 15%, with "tough conditions and increased time-to-hire".

The FTSE 250-listed firm highlighted that its key markets were continuing to face skill shortages but said that group fees continued to be supported by wage inflation and positive pricing.

Hays added that the trading year had begun in line with internal expectations and that it was continuing to benefit from the "positive effects of mix and margins".

Given that group net fees will decline year-on-year in the first half, Hays expects both its conversion rate and operating profits will also decline.

As of 0910 BST, Hays shares were down 0.19% at 102.70p.

Reporting by Iain Gilbert at Sharecast.com