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Adecco outperforms rivals in tough quarter, but warns weak hiring to persist
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Adecco outperforms rivals in tough quarter, but warns weak hiring to persist
Aug 6, 2024 1:53 AM

*

Slight miss on net profit and sales in tough Q2, but EBITA

beats

*

Sees Q3 revenue decline in line with Q2, weak hiring to

persist

*

Shares rise 2.5% as Adecco's results outperform peers

(Recasts with shares, adds bullet points, EBITA beat paragraph

3, analyst comment paragraph 6, peers in paragraphs 7-8)

By Andrey Sychev

Aug 6 (Reuters) - Adecco's second quarter

results outperformed those of global rivals in the tough

staffing market, sending its shares higher on Tuesday, even as

the Swiss group warned that weak hiring trends would persist in

the third quarter.

The fortunes of Adecco, which supplies temporary and

permanent staff to offices, factories and logistics hubs, are

keenly watched for providing insight into the health of the

broader economy.

Adecco's earnings before interest, tax and amortisation

(EBITA) were 179 million euros ($195.5 million) in the quarter,

unchanged from last year on an organic basis and ahead of the

173 million expected by analysts' consensus.

Both revenue and net income fell 2% in the same period, when

adjusted for currency movements, trading days and acquisitions.

Among the worst performing regions by sales were France,

Britain, the Nordics and North America, where the tech and

automotive sectors were notably weak, Adecco said.

"Organic revenue decline was 2% slightly more than

anticipated but still well above market trends and peers,"

Vontobel analyst Michael Foeth wrote in a note.

Quarterly revenues at rivals Randstad and

ManpowerGroup ( MAN ) fell 7.5% and 6.9%, respectively.

British peers Robert Walters, Page Group

and Hays have also recently warned of tough hiring

market conditions in the near term, as workers avoid switching

jobs and companies take longer to fill vacancies amid slowing

economies.

Adecco's results were helped by increased cost cuts that

reached 162 million euros by the end of June, above its 150

million euro target, it said.

The company added it expects July-September revenue to

decline at a similar pace to the second quarter, while it

continues to focus on cutting cost to shield its profits.

($1 = 0.9155 euros)

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