Job placement Adecco continues to feel the effects of a challenging environment

The Adecco Group's business environment remained challenging in the third quarter. Analysts had expected some headwind in advance. The recruitment agency continues to expect challenges in the fourth quarter.

Specifically, sales in the third quarter fell by around 4 percent to EUR 5.7 billion. Adjusted for exchange rate effects and the difference in the number of working days, turnover even fell organically by 5 percent compared to the previous year, according to a statement on Tuesday. In the run-up to the publication of the figures, analysts had on average only expected an organic decline of around 2.6 percent.

Gross profit down

Gross profit fell by around 9 percent to 1.11 billion euros and the corresponding margin by 90 basis points to 19.4 percent (Q2 19.4%). Adecco itself had forecast a slightly higher gross margin for the third quarter - in line with the seasonal nature of the business - which was therefore not entirely successful.

Adjusted for one-off effects, operating profit at EBITA level fell by around 21% to EUR 186 million. The corresponding margin amounted to 3.3 percent after 3.1 percent in the second quarter and 4.0 percent in the same period of the previous year.

At the bottom line, the company earned 99 million euros, around 4 percent less than in the previous year. Adecco thus performed worse than analysts had expected.

"Difficult environment"

Group CEO Denis Machuel is not discouraged by this, however. "The macroeconomic environment remains difficult, but it is encouraging to see that volume trends have stabilized," he is quoted as saying in the press release.

For the fourth quarter, the company now expects sales to develop at a similar level to the third quarter. The gross margin and the administrative expense ratio are also expected to be similar to the third quarter, taking seasonal fluctuations into account.

SDA