Hays (HAS) Trading Update summary

Group performance and financial highlights

• Group net fees declined 12% year-on-year, with Temp and Contracting down 7% and Perm down 19%. December's growth rate matched the quarter overall.

• Consultant productivity increased 4% year-on-year; headcount reduced by 2% in the quarter and 15% year-on-year, reflecting operational efficiency.

• Enterprise business net fee growth accelerated to 12%, now representing about 20% of group net fees, driven by MSP contracts and new client wins.

• Structural cost-saving initiatives reduced periodic cost base to £77 million, with targeted annual savings of £30 million by FY27 and further modest reductions expected.

• Net cash position was £25 million after dividend and pension payments, with pension buy-in expected to boost free cash flow from FY26.

Regional and business line trends

• Germany: Fees down 13%, with Temp and Contracting more resilient than Perm; Technology and Engineering specialisms saw double-digit declines; automotive sector remains weak.

• UK & Ireland: Fees down 14%, with Temp down 11% and Perm down 19%; public sector particularly challenging; Technology Perm fees fell 22%; enterprise segment up 11%.

• ANZ: Fees down 14%, with Temp down 9% and Perm down 23%; New Zealand down 24%; stable activity but continued weakness in Perm.

• Rest of World: Fees down 9%, Temp up 3% but Perm down 16%; Americas up 2% (Canada +10%, US +7%), Mainland China up 18%; France and LATAM notably weak.

• EMEA ex-Germany fell 13%, Asia down 6% overall; Southern Europe remains resilient, northern and eastern Europe more difficult.

Strategic initiatives and outlook

• Focus on business line prioritisation, resource allocation, and scaling in eight focus countries to build a more profitable and resilient business.

• H1 pre-exceptional operating profit expected at ~£25 million, towards lower end of consensus.

• Near-term market conditions expected to remain subdued, especially in Perm; consultant headcount to remain broadly stable in Q3.

• Easter timing to have a 1% positive impact on Q3 fee growth and a 1% headwind in Q4.

• Business line prioritization and resource allocation underpin strategy to exceed previous peak profits of £250 million.