A record quarter for the Group LSE: PAGE.L Website: - - PowerPoint PPT Presentation

Kelvin Stagg Chief Financial Officer LSE: PAGE.L Website: https://www.page.com/investors 10 July 2019

Q2 2019 Trading Update

“A record quarter for the Group”

Headline Numbers

Kelvin Stagg, Chief Financial Officer

Q2 19

Headline Numbers Financial Review Regional Review Summary

3

Key financial highlights

A record quarter for the Group

£224.6m

£208.2m Q2 2018

£433.5m

£396.0m H1 2018

Gross Profit Q2 Gross Profit H1

+7.4%

+11.7% Q1 2019

+7.9%

+11.2% Q1 2019

Growth in Constant Currency Q2 Reported Rates Q2 Michael Page Q2 Page Personnel Q2

• c. £81m
• c. £87m Q2 2018
• c. £29m

Net Cash Dividend paid in June

+6.2%

+9.9% Q1 2019

+10.3%

+15.6% Q1 2019

Financial Review

Q2 19

Headline Numbers Financial Review Regional Review Summary

76% 24%

Perm Temp

85% 15%

Perm Temp

+6.2% 58% 42%

Perm Temp

+10.3%

5

• Gross Profit growth in

permanent +5.1% to £171.5m

• Temporary +15.4% to £53.1m
• Perm:Temp ratio 76:24, down
• n prior year
• Gross Profit growth in

permanent +5.5% to £131.5m

• Temporary +10.3% to £23.8m
• Gross Profit growth in

permanent +4.1% to £40.0m

• Temporary +19.9% to £29.3m

Strong growth in all brands

Perm:Temp ratio down on prior year

+7.4%

Q2 19

Headline Numbers Financial Review Regional Review Summary

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Professional Services strongest performing

35% 25% 24% 16% 25% 25% 25% 25%

Finance Professional Services Technical Marketing, Sales and Retail

Gross Profit by Discipline

Q2 2019 £m 2018 £m Reported % Constant % Finance Accounting and Financial Services 78.1 72.1 +8.3% +8.0% Professional Services Legal, Technology, HR, Secretarial, Healthcare 55.7 49.7 +12.1% +11.7% Technical Engineering, Property & Construction, Procurement & Supply Chain 53.9 49.6 +8.8% +7.8% Marketing, Sales and Retail 36.9 36.8 +0.0%

• 0.2%

Group Total 224.6 208.2 +7.9% +7.4%

More challenging conditions in Marketing, Sales and Retail

Q2 19

Headline Numbers Financial Review Regional Review Summary

1,685 1,728 6,157 6,035

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Q1 2019 Q2 2019 Headcount

Support Staff Fee Earners

• 122
• Decrease in fee earners of 122 (-2.0%)
• Fee earner headcount fell in markets where we saw

more challenging conditions

• Fee earner reduction: -28 EMEA; -37 Asia Pacific;
• 17 Americas; -40 UK
• Flexible business model enables us to react quickly

to changes in market conditions

• Support headcount increased by 43, majority

temporary to support the global roll out of GFS

7

Total headcount

• 1.0%

Focus on productivity and conversion

Ratio of fee earners to support staff 78:22

+43

Q2 19

Headline Numbers Financial Review Regional Review Summary

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49.5 51.4 47.8 43.9 42.8 45.0 45.0 45.7 48.1 52.3 53.5 56.7 59.9 68.3 69.2 70.2 79.2 87.4 89.1 93.1 105.5 121.0 123.4 128.2 140.3 152.4 141.3 118.7 95.0 83.8 82.3 90.6 97.9 111.7 112.8 119.9 127.3 147.8 142.6 136.1 135.9 138.0 126.5 126.5 126.8 135.1 126.9 125.1 126.6 137.1 132.9 136.2 135.7 145.3 139.1 135.8 142.2 156.9 158.6 163.3 170.2 181.8 177.2 182.4 187.8 208.2 207.7 211.1 208.8 224.6 223.7

1500 3000 4500 6000 50 100 150 200 250

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2

Fee Earners Gross Profit (£m) as reported

Fee Earners

Continued strong gross profit growth

Fee earner headcount reacts to trading conditions

Q2 19 Constant currency

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Regional Review

Q2 19

Headline Numbers Financial Review Regional Review Summary

48% 20% 16% 16% EMEA Asia Pacific Americas UK

Q2 growth rate of 7.4%

Gross Profit by Geography

Q2 2019 £m 2018 £m Reported % Constant % EMEA 108.9 100.2 +8.7% +9.0% Asia Pacific 43.8 41.2 +6.4% +4.7% Americas 36.9 30.9 +19.2% +17.4% UK 35.0 35.9

• 2.4%
• 2.4%

Group Total 224.6 208.2 +7.9% +7.4%

Large, High Potential markets* +14%

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• 16 countries achieved YoY growth of over 10%
• 14 countries delivered record quarters
• Americas continued to be fastest growing region

*Germany, Greater China, Latin America, South East Asia and the US

Q2 19

Headline Numbers Financial Review Regional Review Summary

France 32%

• S. Europe

21% Germany 17% Benelux 16% Other 14%

• Michael Page (55% of EMEA) +8%, Page Personnel (45%) +10%
• France, representing 16% of the Group, +6%
• Germany +24%: Michael Page Interim +47%
• Benelux +13%: Strong growth in Belgium and the Netherlands
• Southern Europe +6%: Italy +7%; Spain +3%
• Middle East & Africa +4%

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48% of Group

Gross Profit by Geography

EMEA had another record quarter

Standout performance for Germany

£m Period 2019 2018 Reported % Constant % Gross Profit Q2 108.9 100.2 +8.7% +9.0% H1 213.1 194.9 +9.3% +10.2% Headcount 3,316 3,175 +4.4%

Q2 19

Headline Numbers Financial Review Regional Review Summary

Greater China 40% Australasia 24% SE Asia & India 21% Japan 15%

• Greater China, 8% of the Group, -1%
• South East Asia +8%; Singapore -3%
• Continuing impact of trade tariff uncertainty, particularly amongst our

larger international clients, now also impacting Singapore

• Japan +13%; India +52%; both record quarters
• Australia +4%

20% of Group

Gross Profit by Geography

Asia Pacific impacted by trade tariffs

India and Japan standout performances

12 £m Period 2019 2018 Reported % Constant % Gross Profit Q2 43.8 41.2 +6.4% +4.7% H1 81.9 74.1 +10.5% +9.1% Headcount 1,737 1,660 +4.6%

Q2 19

Headline Numbers Financial Review Regional Review Summary

• US +22%, driven by strong performance in regional offices of

Boston, Chicago, Houston and Los Angeles

• Latin America +15% against tough comparators
• Mexico +30%; Brazil +9%
• The other four countries in Latin America grew 9% collectively

13

Americas continues to be fastest growing region

Record quarters for the US and Latin America

USA 56% Mexico 15% Brazil 11% Canada 4% Rest of Latam 14%

16% of Group

Gross Profit by Geography

£m Period 2019 2018 Reported % Constant % Gross Profit Q2 36.9 30.9 +19.2% +17.4% H1 69.1 57.3 +20.6% +19.4% Headcount 1,342 1,227 +9.4%

Q2 19

Headline Numbers Financial Review Regional Review Summary

London 37% North 23% South 24% Midlands 16%

• Brexit continued to weigh on market sentiment, particularly

with senior candidates

• Page Personnel +8%
• Michael Page -6%

16% of Group

Gross Profit by Geography

UK remained challenging

Good growth in Page Personnel

14 £m Period 2019 2018 Reported % Gross Profit Q2 35.0 35.9

• 2.4%

H1 69.4 69.7

• 0.3%

Headcount 1,368 1,395

• 1.9%

Summary

Q2 19

Headline Numbers Financial Review Regional Review Summary

Currently expect 2019 Operating Profit to be towards the lower end of the range of current market forecasts* Strong net cash position of c. £81m Business model enables us to react quickly to market conditions Fee Earner headcount reduced by 122 16 countries delivered YoY growth of over 10% Group Gross Profit growth rate of +7.4%

16

A record quarter for the Group

Weaker macro-economic conditions in a number of our markets

*Company compiled consensus for 2019 operating profit of £161.1m with a range of £156.5m - £168.0m

Appendix

Q2 19

Headline Numbers Financial Review Regional Review Summary

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Our business model

Q2 19

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Delivering on our global diversification strategy

A growing international business

61% 39% 76% 24% 84% 16% FY 2007 FY 2013 Q2 2019 Gross Profit

International UK

Q2 19

Headline Numbers Financial Review Regional Review Summary

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70% 87% 70% 89% 30% 13% 30% 11% EMEA Asia Pacific UK Americas Temp Perm 85% 58% 15% 42% Michael Page Page Personnel Geography Brands

Significant variations in recruitment mix

Q2 19

Headline Numbers Financial Review Regional Review Summary EMEA

6,035

• 1,000

2,000 3,000 4,000 5,000 6,000 7,000

1990-99 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Fee Earner Headcount

AMERICAS ASIA PACIFIC

21

1985-1990 1990-1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2017 2018

Portugal (2000) Switzerland (2001) Belgium (2002) Sweden (2002) Poland S Africa Ireland UAE Austria Turkey Luxembourg Morocco Thailand Indonesia Taiwan India Malaysia New Zealand Japan (2001) China (2003) Australia (1985) USA (1998) Brazil (2000) Canada Mexico Chile Colombia Peru

INTERNATIONAL GROWTH

France (1986) Netherlands (1987) Germany (1993) Spain (1997) Italy (1997) Hong Kong (1995) Singapore (1996)

EMEA APAC UK Americas

Argentina

UK ASIA PACIFIC EMEA AMERICAS

Long term fee earner and international growth

Q2 19

Vietnam

2016

Q2 19

Headline Numbers Financial Review Regional Review Summary

22

1000 2000 3000 4000 5000 6000 7000 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 Headcount Fee Earner Support Staff 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Fee earner investment and support staff

Q2 19

Headline Numbers Financial Review Regional Review Summary

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Year-on-Year Gross Profit Rates

2017 2018 2019

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

EMEA +14.8% +13.2% +12.6% +19.3% +18.2% +18.6% +20.9% +13.9% +11.4% +9.0% Asia Pacific +3.9% +6.8% +13.9% +14.9% +13.8% +18.4% +27.7% +22.0% +14.9% +4.7% – Asia +3.6% +10.2% +21.9% +20.8% +17.8% +21.2% +32.2% +21.2% +15.6% +5.8% – Australasia +4.7%

• 1.5%
• 4.4%

+0.7% +4.3% +10.6% +15.7% +25.0% +13.0% +0.9% Americas +15.2% +13.8% +18.4% +18.8% +20.4% +29.2% +30.1% +29.2% +21.4% +17.4% – North America +12.5% +14.6% +26.5% +18.7% +16.4% +27.0% +27.2% +30.3% +20.9% +18.9% – Latin America +19.2% +12.8% +9.1% +19.0% +25.7% +32.2% +33.9% +27.7% +21.6% +15.3% UK

• 0.1%
• 4.5%
• 7.6%
• 2.8%
• 7.1%
• 1.9%

+0.8% +2.1% +1.7%

• 2.4%

Group Total +9.1% +7.7% +8.8% +13.8% +12.3% +16.0% +19.7% +15.4% +11.7% +7.4%

Q2 19

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Contacts Jeremy Tatham – Group Financial Controller Tel: +44 (0) 1932 264 143 Email: investorrelations@michaelpage.com Web: https://www.page.com/investors Date Event 7 August 2019 HY 2019 Interim Results 9 October 2019 Q3 2019 Trading Update

Contacts and Calendar

Q2 19

Headline Numbers Financial Review Regional Review Summary

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This presentation contains certain statements that are neither reported financial results nor other historical information. The information contained in this presentation is not audited, is for personal use and informational purposes only and is not intended for distribution to, or use by, any person or entity in any jurisdiction in any country where such distribution or use would be contrary to law or regulation, or which would subject any member of the PageGroup plc group of companies to any registration requirement. No representation or warranty, express or implied, is or will be made in relation to the accuracy, fairness or completeness of the information or opinions made in this presentation. Certain statements included or incorporated by reference within this presentation may constitute “forward-looking statements” that are based on current expectations or beliefs, as well as assumptions about future events. There are risk factors that can cause actual results to differ materially from those expressed in or implied by such statements. Accordingly, no assurance can be given that any particular expectation will be met and reliance should not be placed on any forward-looking statement. PageGroup plc disclaims any intention or obligation to revise or update any forward-looking statements that may be made in this presentation, regardless of whether those statements are affected as a result of new information, future events or

• therwise. Nothing in this presentation should be construed as a profit forecast.

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