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Highlights

  • Hays reports 9% YoY net fee decline in Q4.
  • The company expects GBP 45 million FY25 pre-exceptional operating profit due to subdued permanent hiring market.
  • Hays sees continued Perm softness in Germany, UK&I, ANZ and France amid economic uncertainty.

Hays plc (LSE:HAS), is a global specialist recruitment firm operating in over 30 countries which offers temporary, contract, and permanent recruitment services across various sectors including finance, construction, IT, and healthcare

The company issued a trading update forecasting a full-year FY25 pre-exceptional operating profit of approximately GBP 45 million, as the company continues to face broad-based weakness in permanent hiring markets across major regions. This figure is lower than the GBP 56.4 million average from analyst consensus, driven primarily by macroeconomic uncertainty affecting client and candidate confidence globally.

The company noted a sequential reduction in activity levels during the fourth quarter ending 30 June 2025, especially within its Permanent Recruitment (Perm) division. The overall decline is attributed to more cautious hiring behavior by clients amid persistent global economic headwinds. By contrast, temporary and contracting roles (Temp & Contracting) have remained more resilient.

Hays now expects group like-for-like net fees to decline by 9% YoY in Q4, or 8% on a working-day adjusted basis. Perm fees are projected to fall by 14% YoY, while Temp & Contracting fees are estimated to decline by 5%.

On the cost front, Hays’ periodic cost base, when adjusted for constant currency effects, has marginally improved to approximately GBP 75 million in Q4, compared to GBP 76 million in Q3. However, given the largely fixed nature of short-term costs, the drop-through impact from reduced fees has significantly weighed on profitability.

In terms of regional performance, Hays expects mixed results. Germany, the company’s largest market, is forecast to post a 5% decline in like-for-like net fees. Contracting has remained relatively stable in the region, but Perm and Temp hiring have been impacted by a subdued automotive sector.

In the UK and Ireland (UK&I), Perm weakness has led to an expected 13% YoY net fee decline. Similarly, Australia and New Zealand (ANZ) are anticipated to see a 9% drop. Hays also projects a 9% net fee decline across the Rest of World (RoW) category, with softness noted in EMEA ex-Germany, where net fees are expected to be down 13%, particularly in France.

Asia appears relatively stable, with a modest 3% YoY net fee decline. In the Americas, net fees are projected to fall 1% overall. However, North America remains an exception, delivering 5% YoY net fee growth amid comparatively stable market conditions. Hays expects to close FY25 with a modest net cash position.

Looking ahead to FY26, Hays anticipates that current market challenges will continue. The company reaffirmed its commitment to its strategic initiatives aimed at driving long-term recovery, including improving net fee productivity and enhancing back-office efficiency. These efforts are expected to be key contributors to profit recovery when market conditions stabilize.

Hays shares were trading 13.82% lower at GBX 60.50 per share as of 19 June 2025