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UPDATE 1-Randstad sees only gradual improvement in staffing demand
February 20, 2014 / 9:31 AM / 4 years ago

UPDATE 1-Randstad sees only gradual improvement in staffing demand

* Q4 adjusted net income 104.8 mln euros vs f‘cast 124 mln

* Revenue 4.28 bln vs f‘cast 4.34 bln

* Says does not see acceleration of growth

* Shares down 8 pct, retreat from near 7-year high (Adds CFO comments, analyst quote, shares)

By Sara Webb

AMSTERDAM, Feb 20 (Reuters) - Dutch staffing firm Randstad reported lower-than-expected fourth-quarter earnings and said it expected only a gradual improvement in the current quarter because of the patchy economic recovery, pushing its shares down 8 percent.

Randstad, which provides temporary staff for businesses in Europe and North America, operates in a sector that is seen as a barometer for economic health, as companies tend to hire temporary staff at the beginning of a recovery when most businesses are reluctant to add to their permanent headcount.

“At this stage, we do not see an acceleration of growth, but recent market data suggest the gradual recovery is likely to continue,” Randstad said in a statement.

Revenue per working day on a comparable basis grew 2.2 percent in the fourth quarter, rising to 3.2 percent in January. But Randstad said the recovery in Europe was proving fragile, while its business in North America was hit by bad weather in January and February.

The outlook countered hopes for signs of a more robust recovery in Europe.

“They really need to see an acceleration,” said David Tailleur, analyst at Rabobank, particularly after fourth-quarter results came in below consensus estimates because of currency effects and marketing costs.

Randstad shares were down 8.7 percent at 44.9 euros by 0921 GMT, retreating from a near seven-year high of 49.845 set in recent sessions.

Robert Jan van de Kraats, chief financial officer, said the company saw the strongest signs of improvement in countries such as Germany, Sweden, Portugal, Spain and the United Kingdom, whereas France, the Netherlands and Belgian were proving slower to pick up.

“The recovery is in the blue-collar sector, in manufacturing and logistics, in the automotive and transport sectors, while financial services is lagging,” van de Kraats told Reuters.

“That’s very much in line with what you would expect - first you need hands, then you need banks.”

Randstad reported adjusted net income of 104.8 million euros ($144.1 million) on revenue of 4.28 billion, both up 1 percent from a year ago. Analysts in a poll commissioned by Reuters had forecast adjusted net income of 124 million and revenue of 4.34 billion.

$1 = 0.7271 euros Editing by David Holmes

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