Hays (HAS) Q1 2025 TU earnings summary

Executive summary

• Net fees declined 14% year-over-year, with temp down 10% and perm down 20%, reflecting tough market conditions and subdued client and candidate confidence.

• Consultant productivity increased 5% year-over-year, driven by operational rigor and resource allocation, despite a 2% reduction in headcount during the quarter and 18% year-over-year.

• Seven offices were closed, mainly in the U.S. and U.K., as part of ongoing structural cost-saving initiatives.

• Structural cost savings initiatives targeting GBP 30 million per annum by FY 2027 are progressing, with the current cost base slightly below GBP 80 million.

Financial highlights

• Group net cash position was nil at quarter-end, down from GBP 86.8 million in June 2024, due to normal summer outflows and GBP 10 million in exceptional items.

• Group net fees decreased 14% like-for-like and 15% on an actual basis compared to the same quarter last year.

• Temp and Contracting fees (61% of group) fell 10%, while Perm fees (39% of group) dropped 20%.

• Periodic cost base reduced to slightly below GBP 80 million, ahead of previous guidance.

• Structural cost savings program targeting GBP 30 million per annum by FY 2027 is progressing well.

Outlook and guidance

• Near-term market conditions expected to remain challenging, with subdued but stable activity in most regions.

• Consultant headcount expected to remain broadly stable in Q2 2025.

• Pre-exceptional operating profit in H1 2025 anticipated to be sequentially lower than H2 2024 unless there is a material market recovery.

• Limited forward visibility; no clear signs of improvement in activity levels.