# Hays PLC Record International Profits - Link: https://www.directorstalkinterviews.com/hays-plc-record-international-profits/412757439 - Published: 2018-08-30T07:40:08+01:00 - Author: Giles Arbor **Hays Plc** (LON:HAS) today provided its preliminary results for the year ended 30th June 2018. | Year ended 30 June (In £’s million) | 2018 | 2017 | Actual growth | LFL growth | | Net fees^((1)) | 1,072.8 | 954.6 | 12% | 12% | | Operating profit | 243.4 | 211.5 | 15% | 15% | | Cash generated by operations | 243.5 | 217.0 | 12% | | | Net cash | 122.9 | 111.6 | N/A | | | Profit before tax | 238.5 | 204.6 | 17% | | | Basic earnings per share | 11.44p | 9.66p | 18% | | | Core dividend per share | 3.81p | 3.22p | 18% | | | Special dividend per share | 5.00p | 4.25p | 18% | | Note: unless otherwise stated all growth rates discussed in this statement are LFL( like-for-like) year-on-year net fees and profits, representing organic growth of continuing operations at constant currency · Operating profit up 15% to £243.4m, driven by strong growth in our International businesses. Group Conversion Rate up 50bps to 22.7%(2) · Australia & New Zealand (ANZ): Strong net fee and operating profit growth of 14%, broad-based growth across all Australian regions and specialisms. Record numbers of Temp and Contracting workers · Germany: Record net fees up 16%, with operating profit up 4% (c.17% and c.7% respectively on a trading day-adjusted basis, given three fewer working days(3)). Significant investment in people, offices and systems · UK & Ireland (UK&I): 2% net fee growth, with operating profit up 13% on good cost control, helped by certain IT assets becoming fully depreciated. Market stable overall, despite ongoing economic uncertainty · Rest of World (RoW): Strong net fee growth of 17%, with operating leverage driving excellent profit growth of 51%. 21 markets delivered record net fees including France, the USA, Belgium and China · Significant strategic investments: During the year we continued to invest in our key markets via: – Consultants: headcount up 8%, driven by Germany and RoW both up 13% YoY as we seek to further capitalise on long-term structural growth opportunities. Canada, China and the USA all up over 20% – Infrastructure: Three new offices opened in Germany, four in RoW and c.20 office expansions across our global network. IT system enhancements, designed to deliver scale economies, completed in Germany & France – Technology: Strengthened partnerships with Xing, Google and Stack Overflow, which improve consultant data connectivity. Introduction of new candidate engagement tools, including Salesforce Marketing Cloud · Closing net cash of £122.9m, with strong 100% conversion of operating profit into operating cash flow · Proposed increase in full-year core dividend of 18%, in line with earnings, to 3.81p per share and special dividend of £72.9m (5.00p per share). Total FY18 dividends of £128.4m (2017: £108.2m) Commenting on the results Alistair Cox, Hays Plc Chief Executive, said: “2018 was a landmark year for the Group. We successfully completed our ambitious 2013 plan, passed £1 billion in net fees for the first time and 22 countries delivered all- time records. Our RoW business was the standout performer with excellent profit growth of 51%, despite significant investment. We further strengthened our leading positions in key markets like Australia and Germany, and our UK business delivered a good profit performance, despite macro uncertainty. Overall cash generation was excellent, enabling the Board to propose increasing the full year core dividend by 18% and propose the Group’s second special dividend, of £72.9 million. Looking ahead, conditions remain positive in virtually all of our markets. We are investing significantly in key growth markets where we see structural and market share opportunities, notably Germany, France and the USA. We continue to build on our scale and diversity and are focused on driving profitable, cash-generative growth. The sheer scale and diversity of our global platform combined with our highly experienced management teams means we are well-positioned to capitalise on the growth opportunities identified in our 2022 plan.” (1) Net Fees comprise turnover less remuneration of temporary workers and other recruitment agencies. (2) Conversion Rate is the conversion of net fees into operating profit. (3) The estimated working day impact is calculated on our Germany Temp & Contractor businesses only, we make no estimate of the impact on our Perm business. It represents an assumption based on recent trends of revenues / working day in our major Temp and Contractor businesses. (4) The underlying Temp gross margin is calculated as Temp net fees divided by Temp gross revenue and relates solely to Temp placements in which Hays generates net fees and specifically excludes transactions in which Hays acts as agent on behalf of workers supplied by third party agencies and arrangements where the Company provides major payrolling services. (5) Represents percentage of Group net fees and operating profit. Hays Group Overview Hays Plc has 10,978 employees in 257 offices in 33 countries. In many of our global markets, the vast majority of professional and skilled recruitment is still done in-house, with minimal outsourcing to recruitment agencies, which presents substantial long-term structural growth opportunities. This has been a key driver of the rapid diversification and internationalisation of the Group, with the International business representing 76% of the Group’s net fees as at 30 June 2018, compared with 25% in 2005. Our 7,464 consultants work in a broad range of sectors, with no sector specialism representing more than 21% of Group net fees. While Accountancy & Finance, Construction& Property and IT represent 50% of Group net fees, our expertise across 20 professional and skilled recruitment specialisms gives us opportunities to rapidly develop newer markets by replicating these long-established areas of expertise. In addition to this international and sectoral diversification, the Group’s net fees are generated 58% from temporary and 42% permanent placement markets. This balance gives our business model relative resilience. Our diversified business model continues to be a key driver of the Group’s financial performance. Share on: