* Group Q1 gross profit 136 mln stg, up 6.9 pct
* Reports continued weakness in the banking sector
* Expects to deliver growth over the long-term
* Shares down 4.7 pct, top FTSE 250 faller
By Neil Maidment
LONDON, April 11 British recruitment firm
Michael Page International Plc sees no end to a hiring
freeze in the turbulent banking sector, one of its key markets,
it said on Wednesday as it posted a slowdown in group fee growth
over the past month.
Shares in the company, which also warned over the effects of
the euro zone debt crisis, dropped to a near two-month low.
"Clearly there are still issues around the euro zone
sovereign debt and these things are influencing our business,
but ... I don't think things are getting worse," Chief Executive
Steve Ingham told Reuters.
"Our conclusion on March was that banking remains difficult
(and) certain geographies remain more challenging than others,"
Ingham said, identifying Italy, Spain and Britain.
The group, which places people in accounting, financial and
legal jobs, said its net fees had increased by 7 percent in the
first quarter as a whole, implying a slowdown in March - a key
month because it tends to be clear of holidays around the world
- given fees had risen 10 percent in both January and February.
However it said it was well spread to prosper regardless.
"The diversity of the business, in terms of other
professions away from banking and other geographies away from
the UK and southern Europe, makes us feel that we can achieve
solid growth this year," Ingham said.
Michael Page said fees in banking, which accounts for around
8 percent of group profit, fell 12 percent in the quarter, with
financial clients - having cutting large swathes of jobs in 2011
- slow to start hiring again in an uncertain economic climate.
The bank sector in Europe has been hit by a series of
factors ranging from increased regulation to tough trading
conditions, forcing many lenders to shed staff and keep a lid on
hiring as part of a clampdown on costs.
Shares in Michael Page were the biggest faller on the FTSE
250 index, down 4.7 percent to 432.2 pence at 0901 GMT, having
dropped to their lowest since mid February.
Panmure Gordon analysts retained a "sell" rating on the
stock, saying in a research note: "First quarter results ...
show some decent progress at the gross level, though give us
little clarity on how the year is likely to pan out. Visibility
remains limited and macro pressure suggests to us little
prospect for market improvements in 2012".
The group said gross profit rose to 136 million pounds
($215.4 million) in the three months through March from 127.3
million a year ago.
It said it had achieved growth across all its regions, apart
from the UK, with strong sectors such as IT, engineering and
commodities in regions like Germany, France, Latin America,
China and Australasia offsetting softer markets elsewhere.
Asia Pacific grew 23 percent while at the other end of the
scale the UK declined by 4 percent.
Last week rival recruiter Robert Walters posted a 12
percent increase in first-quarter net fees, while Hays
told Reuters it had a more optimistic global outlook with firms
now hiring again.