PageGroup reports a 20% annualised decline in its fourth-quarter profit

PageGroup reports a 20% annualised decline in its fourth-quarter profit
Written by:
Wajeeh Khan
January 13, 2021
  • PageGroup reports a 20% annualised decline in its fourth-quarter profit.
  • The recruiter refrains from giving guidance for fiscal 2021.
  • PageGroup scrapped dividend payments and slashed workforce last year.

PageGroup plc (LON: PAGE) said on Wednesday that its profit in the fiscal fourth quarter came in 20% lower than last year due to the ongoing Coronavirus pandemic that pushed businesses into freezing new hiring to cut costs.

According to the British recruiter, it was unable to give guidance for fiscal 2021 and beyond at the moment. For the quarter that concluded on 31st December, PageGroup reported £165.4 million of gross profit. In the United States and the UK, its gross profit was 31% and 34% down respectively.

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PageGroup shares, that you can learn to buy online here, was reported more than 2% down in premarket trading on Wednesday and tanked another 2% later in the day. The stock is now trading at 444 pence per share versus a low of 280 pence per share in March 2020.

CEO Steven Ingham’s comments on Wednesday

CEO Steve Ingham commented on the financial update on Wednesday and said:

“As we enter 2021, there remains a high degree of global macro-economic uncertainty in many of our markets.”

PageGroup, however, expressed confidence that performance in Japan and Mainland China showed signs of improvement in December. In separate news from the United Kingdom, peer Robert Walters expressed confidence on Tuesday that its annual profit will top market estimates.

The COVID-19 crisis pushed PageGroup into slashing its workforce by one thousand jobs last year. The FTSE 250 listed company said that fee earner headcount saw an annualised decline of 15% in 2020, but the ratio of fee-earning staff to non-fee earners remained unchanged.

PageGroup scrapped dividend payments last year

In a bid to minimise costs amidst the ongoing pandemic that has so far infected more than 3.1 million people in the UK and caused over 83 thousand deaths, the Weybridge-based company also resorted to scrapping dividend payments last year and cutting its directors’ salary.

As per PageGroup, the atmosphere is likely to remain challenging in the upcoming months with the new variant of the flu-like virus continuing to disrupt its business that is already facing uncertainty due to Brexit. In an announcement last month, PageGroup named John Stevens as an independent non-executive director.

PageGroup performed fairly downbeat in the stock market last year with an annual decline of roughly 15%. At the time of writing, the British recruitment business is valued at £1.45 billion and has a price to earnings ratio of 29.55.