TIDMRWA
RNS Number : 1300J
Robert Walters PLC
08 April 2020
8 April 2020
ROBERT WALTERS PLC
(the 'Company' or the 'Group')
Trading update for the first quarter ended 31 March 2020
FIRST QUARTER IMPACTED BY COVID-19.
SECOND QUARTER WILL BE MORE CHALLENGING.
Financial and operational highlights
Gross profit (Net fee Q1 2020 Q1 2019 % change % change
income) (constant
currency*)
Group GBP87.4m GBP98.6m (11%) (11%)
---------- ---------- --------- ------------
Asia Pacific GBP34.5m GBP36.4m (5%) (5%)
---------- ---------- --------- ------------
Europe GBP25.4m GBP26.2m (3%) (2%)
---------- ---------- --------- ------------
UK GBP19.7m GBP27.7m (29%) (29%)
---------- ---------- --------- ------------
Other International GBP7.8m GBP8.3m (6%) (6%)
---------- ---------- --------- ------------
* Constant currency is calculated by applying prior period
average exchange rates to local currency results for the current
and prior years.
-- Group net fee income for the first quarter impacted by
ongoing Covid-19 global pandemic.
-- Home-working is now in practice across the whole of the
Group's international footprint with the exception of Mainland
China and Taiwan where, positively, there has been a return to
office-based working as infection rates have reduced.
-- Our previous investment in technology, particularly in
tablets for all consultants globally, has ensured the transition to
home-working has been seamless without adversely disrupting service
levels to clients and candidates or internal working practices and
communications.
-- Strong but sensible cost reduction measures (Group's cost
base reduced by 15% as of 1 April) are in place across the Group,
including:
o Reduction in all discretionary spend.
o Executive PLC Board Directors have elected to take a 20% salary reduction; and
o Voluntary schemes for employees to adopt reduced working hours
have proven successful across the globe - a testament to the
strength of the Group's culture and unity of purpose.
-- The Group is in close contact with a number of national
governments across the globe to ensure employment protection
schemes are utilised for relevant employees.
-- Asia Pacific net fee income down 5% (down 5% actual).
o Japan, the Group's most profitable country, South Korea,
Malaysia and Vietnam have proven extremely resilient, all
increasing net fee income by 10% or more year-on-year. Greater
China significantly impacted.
o Activity levels in Australia and New Zealand slowed
significantly during the last two weeks of March as infection rates
increased.
-- Europe net fee income down 2% (down 3% actual).
o Benelux, Switzerland and Portugal performed well all
increasing net fee income year-on-year despite the impact of
Covid-19 in March.
o France and Spain experienced slowdowns in March as lockdowns
were instigated, resulting in single digit declines in net fee
income for the quarter.
-- UK net fee income down 29%.
o Candidate and client confidence, in both specialist
recruitment and recruitment process outsourcing, declined across
the UK during March with the phased government moves towards
lockdown.
o Technology, supply chain and logistics sectors have proven more resilient.
-- Other International (the Americas, Middle East and South
Africa) net fee income down 6% (down 6% actual).
o Strong performance across North America particularly across
technology and digital disciplines. Middle East also performed very
well increasing net fee income significantly year-on-year.
-- Group headcount decreased by 2% to 3,935 (31 December 2019:
4,027).
-- Strong balance sheet with net cash of GBP109.8m as at 31
March 2020 (31 March 2019: GBP59.5m). The Group also has a GBP60m
committed loan facility due for renewal in 2023. The cash position
has benefited from a strong focus on cash collection and the
ability to defer cash outflows in some countries.
Robert Walters, Chief Executive, commented:
"First and foremost, I would like to publicly thank all of the
Group's employees across the globe for the incredible resilience
and unity of purpose they have shown in the face of the events
experienced during the quarter. Our previous investment in
technology, particularly in tablets for all consultants globally,
has ensured the transition to home-working has been seamless
without adversely disrupting service levels to clients and
candidates or internal working practices and communications.
"Trading for the first quarter was negatively impacted by the
Covid-19 pandemic. With Europe and the Americas recently following
much of the Asia Pacific region into varying stages of lockdown, we
are expecting the second quarter to be more challenging. The
picture across the globe is changing hour to hour and day to day,
so it would be imprudent to attempt to give accurate forward
guidance on expected full year trading at this stage.
"The Group has a strong balance sheet, strong cash position and
an experienced management team who have navigated the business
through various international crises over our 35-year history. I am
confident that we will emerge from this period of uncertainty very
well placed to benefit from operational gearing to quickly take
advantage of the inevitable market opportunities."
The Group will publish a trading update for the quarter ending
30 June 2020 on 9 July 2020.
- Ends -
Further information
Robert Walters plc
Robert Walters, Chief Executive
Alan Bannatyne, Chief Financial
Officer +44 20 7379 3333
Portland Communications
Steffan Williams
Simon Hamer +44 7766 901 802
About Robert Walters Group
The Robert Walters Group is a market-leading international
specialist professional recruitment group with over 3,900 staff
spanning 31 countries. We specialise in the placement of the
highest calibre professionals across the disciplines of accountancy
and finance, banking, engineering, HR, IT, legal, sales, marketing,
secretarial and support and supply chain and procurement. Our
client base ranges from the world's leading blue-chip corporates
and financial services organisations through to SMEs and start-ups.
The Group's outsourcing division, Resource Solutions is a market
leader in recruitment process outsourcing and managed services.
www.robertwaltersgroup.com
Forward looking statements
This announcement contains certain forward-looking statements.
These statements are made by the directors in good faith based on
the information available to them at the time of their approval of
this announcement and such statements should be treated with
caution due to the inherent uncertainties, including both economic
and business risk factors, underlying any such forward-looking
information.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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