PageGroup says Iran war creating more uncertainty as Q1 profits fall

(Sharecast News) - Recruiter PageGroup said first quarter gross profit fell 3.9% as an uncertain economic environment in Europe and the Middle East offset growth in Asia and the Americas. "Whilst we have seen signs of a normalisation in trading in some of our markets, the increased geopolitical and macro-economic risks due to the conflict in the Middle East create a heightened degree of uncertainty in the outlook for the rest of the year," the company said in a trading statement on Tuesday.

"Salary levels remain strong, although the level of increases offered to candidates were not as elevated as they were in 2022 and early 2023 and, as a consequence, the conversion of offers to placements remained the most significant challenge," the company said.

Shares in the company fell by 6% in early trade before rallying to be 0.83% higher at midday.

Page said it continued to experience lower levels of candidate and client confidence in Europe, particularly in its second largest market, France, as well as the UK amid hiring cutbacks with employers delaying recruitment decisions and workers become wary of changing jobs, amid worries over the spread of artificial intelligence.

Gross profit fell to £187m on a reported basis, the 13th consecutive quarter of declining fees. In constant currency the decline was 4.9% Page said, adding that gross profit in its Middle East business fell 12% in the quarter.

Europe, Middle East and Africa is the group's largest business division, accounting for more than half of group gross profit, with France and Germany contributing the biggest share.

Reporting by Frank Prenesti for Sharecast.com