The FTSE 250-listed PageGroup PLC (GB:PAGE) stock declined over 2% after the British recruitment company reduced its profit forecast for the full year 2023. The company experienced a sluggish fourth quarter, as both employers and job seekers adopted a cautious approach in a difficult trading environment. PAGE shares have declined more than 8% over the past year.
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PageGroup will announce its full-year results for 2023 on March 7, 2024. The company offers recruitment services across 37 countries around the world.
Navigating Challenges with Resilience
PageGroup now expects its full-year operating to be slightly below the previous guidance range of £120 million to £125 million. The company’s gross profit is expected to decline by 8.9% to £237.3 million compared to last year.
Among its businesses, Permanent recruitment was hit hard as employers looked for temporary roles due to flexibility. Gross profits from temporary hiring increased by 5.2% (at constant currency) in Q4 2023, while permanent hiring experienced a notable drop of 13.9%. Regionally, the conditions showed no signs of improvement in Q4 2023 in Asia, the UK, or the U.S., and notably worsened in Europe.
Given the tough backdrop, the company implemented cost-cutting measures by eliminating 224 jobs, constituting 3.7% of its fee-earning roles.
What Are Analysts Saying?
Analysts from Hargreaves Lansdown said the company is maintaining a positive outlook in a challenging job market. However, they also highlighted that the struggle is real, with employers globally exercising caution due to an uncertain economic environment.
RBC Capital Markets’ analysts said that the update was in line with expectations, considering the numbers reported by other players in the industry.
Overall, the recruitment industry is facing challenges as workers hesitate to switch jobs and salary levels have reduced, reflecting difficulties in major employment markets.
