UK performance drags on Robert Walters full-year profit
Recruitment firm Robert Walters has reported a 25 per cent drop in gross profit for the full year as fee income slipped.
It came as group net fee income fell 26 per cent to £302.4m for the year ended 31 December.
“The sequential quarter-on-quarter improvement in net fee income from quarter two onwards, combined with the short-term and targeted cost control measures put in place at the onset of the pandemic, has enabled the Group to deliver full-year profits ahead of market expectations,” chief executive Robert Walters said.
At the start of the pandemic, Walters blamed the “savage” coronavirus for a dip in its reported figures. In a bid to cut costs a number of employees were placed on furlough, but now just three per cent of the firm’s UK workforce are on furlough.
Robert Walters’ headcount has also reduced 22 per cent to 3,147 which the company said was a mix of “natural attrition, performance management and right-sizing”.
Despite the fall in profit, Robert Walters said the full year figures came in ahead of current market expectations. A stronger fourth quarter helped to pull the figures higher after falls of 34 and 30 per cent in the previous two quarters.
Chairman Ron Mobed said the group’s strategy “is centred on expansion into new international markets and disciplines, but through downturns and periods of crisis we have also benefited from a commitment to maintaining our geographic footprint.” Nearly 80 per cent of the group’s net fee income derives from its international business.
It came as the UK’s performance continued to drag on the recruiter’s figures with net fee income plunging some 32 per cent to £66.9m with operating income down from £11.7m to £1.3m. Robert Walters said market sentiment had been slightly more positive in regional hubs over London as firms moved roles to lower-cost locations.
Europe fared marginally better with fee income down 21 per cent to £85.7m but operating profit dropped more than £10m to £4.7m.
The group’s largest region, Asia Pacific, which accounts for 41 per cent of fee income, showed “signs of improvement in forward-looking indicators” providing a “degree of cautious optimism for a longer-term economic recovery”.
Net fee income for the region fell 25 per cent to £124.1m while operating profit slipped to £8.4m.
The board has proposed a final dividend of 11.0 pence per share.