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PageGroup sees profit at lower end of market view, hiring pressured by Brexit

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By Reuters
PageGroup sees profit at lower end of market view, hiring pressured by Brexit
FILE PHOTO: Workers walk to work during the morning rush hour in the financial district of Canary Wharf in London, Britain, January 26, 2017. REUTERS/Eddie Keogh   -   Copyright  Eddie Keogh(Reuters)
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(Reuters) – Recruitment firm PageGroup Plc <PAGE.L> said on Wednesday it expects full-year operating profit to be at the lower end of market expectations due to slower hiring as more companies wait for more clarity on Brexit.

Last week, recruitment industry group REC’s report said the number of people hired for permanent jobs through recruitment firms in Britain fell for a fourth straight month in June.

The company, which helps hire executives, professionals and clerical staff, said operating profit was likely to be at the lower end of the £156.5 million to £168 million range.

Gross profit in the UK, which accounts for 16% of the group, declined 2.4% to £35 million in the second quarter.

Greater China reported a 1% fall in quarterly gross profit because of the continuing impact of trade tariff uncertainty and more recently, social unrest in Hong Kong.

“Fee earner headcount fell in markets where we saw more challenging conditions, such as France, Greater China and the UK,” said Chief Financial Officer Kelvin Stagg.

Rival recruiter Robert Walters <RWA.L> is also feeling pressure in the UK as it reported an 8% fall in net fee income in Britain in the quarter.

PageGroup’s shares are expected to fall as much as 5% according to premarket indicators.

(Reporting by Pushkala Aripaka and Tanishaa Nadkar in Bengaluru; Editing by Arun Koyyur, Bernard Orr)