Hays Regulatory News (HAS)

HAYS PLC - Interim Management Statement

PR Newswire

London, April 10

Growth in net fees for the quarter ended 31 March 2013 (Q3 FY13)(versus the same period last year)

Commenting on the Group's performance, Alistair Cox, Chief Executive, said:

"We have delivered a resilient performance against an economic backdrop thatcontinues to be mixed and fragile overall. The start to the second half in ourkey Temp and Contractor markets has been encouraging and although many Permmarkets remain challenging, they are broadly stable. Our proven ability toreact quickly to the world as it changes, investing in stronger markets whilekeeping firm control on costs around the Group, continues to yield benefit interms of our financial performance.

Looking ahead, we expect conditions to remain fragile but mixed. Althoughseveral markets are likely to remain challenging, these sit alongside clearopportunities for growth. The diverse business we have built positions us welland we remain focussed on delivering long term sustainable growth while drivingprofits along the way."

Group

In the third quarter ended 31 March 2013 net fees decreased by 3% on alike-for-like basis(1) against prior year (net fees decreased by 3% on aheadline basis). Net fees in the Temp business, which accounted for 59% ofGroup net fees, increased 1% year-on-year(1) and the underlying temporaryplacement margin(3) was stable. Net fees in the Perm business decreased by 8%(1).

The exit rate of Group net fees for the quarter was broadly in line with thequarter as a whole.

Consultant headcount was up 1% during the quarter and flat year-on-year. Weremained selective through the quarter regarding areas of investment andcontinued to focus on tight cost control to maximise Group financialperformance.

Based on an encouraging start to the second half in key Temp markets and ourcontinued focus on cost control around the Group, as well as beneficialmovements in key exchange rates, we expect full year operating profit to be atthe top of the current range of market estimates(2).

Asia Pacific

In Asia Pacific, which represents 28% of Group net fees, net fees decreased by14%(1).

In Australia & New Zealand net fees decreased by 18%(1) within which our Tempbusiness decreased by 12%(1) and our Perm business decreased by 26%(1). Overallmarket conditions in Australia remained challenging but sequentially stablethrough the quarter. In New South Wales and Victoria, which together accountfor 48% of our Australian business, net fees were down 13%(1) and conditionsremained particularly challenging in the Perm business. In Western Australiaand Queensland, which together account for 34% of our Australian business, netfees decreased by 28%(1) primarily due to continued tough conditions in ourResources & Mining business. New Zealand delivered good net fee growth of 7%(1).

In Asia, which accounted for 15% of the division, net fees increased by 14%(1),mainly due to weaker comparatives. In Hong Kong, net fees increased over 100%(1)and in China net fees increased 15%(1), whereas in Japan net fees were flat(1). Overall, market conditions remained subdued.

Consultant headcount in the division was up 1% in the quarter but down 9%year-on-year.

Continental Europe & Rest of World (`RoW')

In Continental Europe & RoW, our largest division which represents 41% of Groupnet fees, we delivered solid net fee growth of 4%(1). In Germany, net feesincreased by 7%(1) with strong performances in Accountancy & Finance,Construction & Property and Life Sciences and solid growth in IT andEngineering. As the quarter progressed we saw a slowdown in the rates ofgrowth.

Net fees were flat(1) in the rest of the division, which is primarily a Permbusiness, and where market conditions remained mixed and fragile overall. Eightcountries delivered net fee growth of 10%(1) or more, including the key marketsof Canada and Russia. Activity elsewhere continues to be significantly impactedby adverse macro-economic conditions with 12 countries recording net feedeclines in the quarter.

Consultant headcount in the division was down 1% in the quarter but up 9%year-on-year.

United Kingdom & Ireland

In the United Kingdom & Ireland, net fees were flat year-on-year with modestsequential growth through the quarter. Within this, our Temp business increasedby 4%, our Perm business decreased by 7% and by region, we saw good growth inYorkshire, the Home Counties, Scotland and the Midlands.

In our private sector business, net fees decreased by 6% as market conditionsremained fragile overall, especially in our Banking and City-relatedspecialisms. Elsewhere, our Construction & Property, Life Sciences and ITbusinesses were amongst those which delivered good growth. Our public sectorbusiness delivered net fee growth of 17%, driven primarily by job churn in thepermanent segment, and activity was notably strong in our Education andHealthcare businesses.

Consultant headcount in the division was up 3% in the quarter but down 4%year-on-year.

Cash flow and balance sheet

Net debt ended March at £140 million (31 December 2012: £145.4 million). Weexpect Group net debt to continue to reduce in the fourth quarter.

(1)LFL (like-for-like) growth represents organic growth at constant currency.

(2)As of 10 April 2013 we understand the range of analysts' estimates for

Operating Profit in the financial year ended June 2013 to be £112.3m to £

122.5m.

(3)The underlying temporary placement gross margin is calculated as temporary

Paul Venables and David Walker of Hays plc will conduct a conference call foranalysts and investors at 9:00am United Kingdom time on 11 April 2013. Thedial-in details are as follows:

The call will be recorded and available for playback for seven days as follows:

Hays Group overview

Hays has 7,810 employees in 240 offices in 33 countries. In many of our globalmarkets, the vast majority of professional and skilled recruitment is stilldone in-house, with minimal outsourcing to recruitment agencies which presentssubstantial long-term structural growth opportunities. This has been a keydriver of the rapid diversification and internationalisation of the Group, withthe International business representing 70% of the Group's net fees as at 31December 2012, compared with around 15% just 10 years ago.

Our 5,038 consultants work in a broad range of sectors with no sectorspecialism representing more than 25% of Group net fees. While Accountancy &Finance, Construction & Property and IT represent 64% of Group net fees, ourexpertise across 20 professional and skilled recruitment specialisms gives usopportunities to rapidly develop newer markets by replicating theselong-established, existing areas of expertise.

In addition to this international and sectoral diversification, the Group's netfees are generated 59% from temporary and 41% permanent placement markets, andwe believe that this balance gives our business model relative resilience inthe current environment.

This well diversified business model continues to be a key driver of theGroup's financial performance.

Hays operates in the following countries: Australia, Austria, Belgium, Brazil,Canada, Colombia, Chile, China, the Czech Republic, Denmark, France, Germany,Hong Kong, Hungary, India, Ireland, Italy, Japan, Luxembourg, Malaysia, Mexico,the Netherlands, New Zealand, Poland, Portugal, Russia, Singapore, Spain,Sweden, Switzerland, UAE, the United Kingdom and the USA.

Cautionary statement

This Interim Management Statement (the "Report") has been prepared inaccordance with the Disclosure Rules and Transparency Rules of the UK FinancialServices Authority and is not audited. No representation or warranty, expressor implied, is or will be made in relation to the accuracy, fairness orcompleteness of the information or opinions made in this Report. Statements inthis Report reflect the knowledge and information available at the time of itspreparation. Certain statements included or incorporated by reference withinthis Report may constitute "forward-looking statements" in respect of theGroup's operations, performance, prospects and/or financial condition. By theirnature, forward-looking statements involve a number of risks, uncertainties andassumptions and actual results or events may differ materially from thoseexpressed or implied by those statements. Accordingly, no assurance can begiven that any particular expectation will be met and reliance should not beplaced on any forward-looking statement. Additionally, forward-lookingstatements regarding past trends or activities should not be taken as arepresentation that such trends or activities will continue in the future. Theinformation contained in this Report is subject to change without notice and noresponsibility or obligation is accepted to update or revise anyforward-looking statement resulting from new information, future events orotherwise. Nothing in this Report should be construed as a profit forecast.This Report does not constitute or form part of any offer or invitation tosell, or any solicitation of any offer to purchase or subscribe for any sharesin the Company, nor shall it or any part of it or the fact of its distributionform the basis of, or be relied on in connection with, any contract orcommitment or investment decisions relating thereto, nor does it constitute arecommendation regarding the shares of the Company or any invitation orinducement to engage in investment activity under section 21 of the FinancialServices and Markets Act 2000. Past performance cannot be relied upon as aguide to future performance. Liability arising from anything in this Reportshall be governed by English Law, and neither the Company nor any of itsaffiliates, advisers or representatives shall have any liability whatsoever (innegligence or otherwise) for any loss howsoever arising from any use of thisReport or its contents or otherwise arising in connection with this Report.Nothing in this Report shall exclude any liability under applicable laws thatcannot be excluded in accordance with such laws.