Recruiter Hays cuts dividend as profit plunges; says September is key

Thu, 21st Aug 2025 09:30

(Alliance News) - Hays PLC on Thursday reported a plunge in annual profit, confirming the bad news the company gave to the market in a profit warning back in June.

The London-based recruiter had said it expected annual profit to be below market consensus, as it grappled with challenging market conditions, amid "low levels of client and candidate confidence".

Hays on Thursday said pretax profit dropped by 90% to GBP1.5 million in financial year that ended June 30 from GBP14.7 million a year before, as net fees declined by 13% to GBP972.4 million from GBP1.11 billion. The fee decline was 11% at constant currency.

Operating profit before exceptional items was GBP45.6 million, down 57% from GBP105.1 million. This was in line with the guidance the company provided back in June.

Hays took GBP30.7 million in exceptional charges in the recent year, down from GBP80.0 million in financial 2024. The financial 2025 items consisted of a restructuring charge of GBP17.7 million in the recent year and GBP13.0 million in costs for technology and finance "transformation" programmes.

Basic loss per share widened to 0.49 pence from 0.31p.

In response, Hays cut its dividend by 59% to 1.24p per share from 3.00p.

Hays shares were down 5.3% to 60.13p. They are down 25% so far in 2025.

The company said the 11% decline in net fees at constant currency was led by Permanent placements, where net fees were down 17%. Temp & Contracting placement fees were more resilient, it said, down 7%.

"Market conditions remained challenging during the year, with economic and political uncertainty weighing on confidence, increasing 'time-to-hire' and reducing placement volumes," explained Chief Executive Officer Dirk Hahn.

"Despite making significant strategic and operational progress towards our long-term ambitions, our overall financial performance was impacted by these headwinds."

Looking ahead, Hays said trading in financial 2026 so far is in line with the fourth quarter of financial 2025, with no significant change seen during July and August. "September is the key trading month in our first quarter, and it is too early to assess trends," the company said.

By Tom Waite, Alliance News editor

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