Recruiter PageGroup warns worsening conditions in Europe have hit profits

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

PageGroup, one of the biggest London-listed recruitment groups, has warned that annual profits will be at the lower end of market expectations as conditions deteriorate in Europe.

In a trading update on Monday, PageGroup reported gross profit of £196.7mn in the fourth quarter of last year, down 13 per cent on the same period in 2023.

Shares fell 4 per cent in early trading in London and have fallen by one-third in the past year. The recruiter, which warned in July that profits would fall in 2024, has a market valuation of just less than £1bn.

Chief executive Nicholas Kirk said conditions in Europe had worsened, particularly in Germany and France, two of its largest markets. Gross profits in its Emea region, which accounts for more than half of profits, plunged 19.1 per cent on the same period in 2023.

“The conversion of interviews to accepted offers remains the most significant area of challenge as the ongoing macroeconomic uncertainty continues to impact candidate and client confidence, also extending the time-to-hire,” said Kirk.

The company reduced its number of fee-earning staff by 130, or 2.4 per cent, in the final quarter of 2024.

PageGroup said profits for 2024 would be “towards the lower end” of the market consensus range of £49mn to £58.5mn.

Kirk added: “We continue to review our fee earner headcount, making progress on our strategy by reallocating resources into the areas of the business where we see the most significant long-term structural opportunities.”

Other recruiters have also warned about tough conditions. Robert Walters said in October that hiring markets were “challenging” and the company’s monthly jobs index last month reported an 8 per cent drop in new job creation in professional roles around the world.

SThree, which specialises in recruitment for science and engineering jobs, last month warned that it expected a sharp fall in profits in 2025, sending shares down across the sector.