Robert Walters profits tank in 'tough' market conditions

(Sharecast News) - Recruiter Robert Walters posted a sharp drop in full-year profits on Thursday as it cited "tough" market conditions and subdued client and candidate confidence levels. In the year to the end of December, pre-tax profits were nearly wiped out, down 98% to £0.5m, with operating profit down 80% to £5.2m and net fee income 17% lower at 321.4m. Revenue declined 16% to £892.1m.

In Asia-Pacific, which accounts for 43% of group net fee income, the latter was down 12%, while Europe, which accounts for 33%, saw a 14%.

In the UK, which accounts for around 16% of net fee income, the latter fell 17%, while Rest of World saw a 13% decline.

Robert Walters said the challenging conditions seen after the post-pandemic jobs surge stretched into a second year in 2024. Client and candidate confidence, "already fragile from the preceding year", remained muted, it said.

This was against a backdrop of interest rates which fell less quickly than anticipated, and macroeconomic and political uncertainty in several major hiring markets.

Chief executive Toby Fowlston said 2024 had been "another challenging year for global hiring markets".

"Several factors acted to dampen client and candidate confidence levels, therefore slowing the pace of job moves and impacting our financial performance," he said.

The recruiter said trading over the first few weeks of the new financial year has continued to be muted, within the seasonally quieter first quarter.

"The board's planning assumption remains that, at the earliest, an improvement in end markets is unlikely to be seen before the latter part of 2025, and as such the business will continue to ensure its cost base is appropriate for the current conditions," it said.

"Looking further ahead, the early progress against the refreshed strategy, and the group's ability to support clients and candidates in the changing world of work, gives confidence on driving higher rates of profitability over the medium-term."

At 0918 GMT, the shares were down 1.2% at 243p.