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(Correcting that reporting period is for six months to the end of June.)
(Alliance News) - PageGroup PLC on Wednesday halted its special dividend after five consecutive interim periods with a payout, awaiting improved conditions as the group swung sharply to a loss on a weaker performance.
For the six months to the end of June, the FTSE 250-listed recruitment firm reported a pretax loss of GBP751,000, compared to a profit of GBP74.6 million the same period the year before.
This was on revenue that declined by 20% year-on-year to GBP655.0 million from GBP820.5 million. On a constant currency basis, revenue dropped by 19%.
The head count of fee earner fell by 1.7% to 5,392, mainly due to challenging conditions as a result of Covid-19, particularly in the UK and Americas. PageGroup's total headcount declined by 9.3% to 6,985.
As a result of the severe reduction in activity across the group as a result of the lockdowns around the world and the uncertainty surrounding Covid-19, PageGroup has suspended its dividend policy, making no ordinary or special payout for the interim period.
Looking ahead, PageGroup has suspended its financial guidance for 2020 and the years beyond, however it had started a safe reopening of its offices from July 1, as well as reintroducing full pay to staff.
"We took decisive management actions on costs to protect near-term profitability, whilst at the same time investing in our platform to ensure we emerge from this period in a position of strength. We also focused on ensuring we retained a strong cash position, which we achieved, and we have access to sizeable borrowing facilities, if required. However, trading conditions remain uncertain and, as such, we have taken the decision to suspend our dividend policy. It is our intention to reinstate shareholder returns when conditions improve," said Chief Executive Officer Steve Ingham.
"Whilst trading conditions remain unpredictable, we are choosing to invest in the business, returning all our staff to full time working and full pay in the third quarter. We are also investing in experienced hires from our competitors as well as continuing to invest in systems, such as our new operating system, Customer Connect," Ingham added.
Shares in PageGroup were up 2.4% at 378.20 pence on Wednesday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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