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.

• Structural cost-saving initiatives reduced the periodic cost base to £77 million, with targeted annual savings of £30 million by FY27.

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

• Enterprise business net fee growth accelerated to 12%, driven by MSP contracts and new client wins.

Regional and sector trends

• Germany fees fell 13%, with Temp and Contracting down 10% and Perm down 27%; Technology and Engineering specialisms saw double-digit declines.

• UK & Ireland fees decreased 14%, with Temp down 11% and Perm down 19%; public sector down 21% and private sector down 10%.

• ANZ fees declined 14%, with Temp down 9% and Perm down 23%; New Zealand was particularly challenging, down 24%.

• Rest of World fees dropped 9%; Americas saw 2% growth, led by US (+7%) and Canada (+10%), while Asia was down 6%.

• Mainland China net fees grew 18%, while Hong Kong was down 38%.

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 around £25 million, at the lower end of consensus.

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

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

• Enterprise business performed strongly, with net fee growth accelerating to 12% in Q2, driven by MSP contracts and new client wins.