Achieving High Profitability in Q3 2014 for Temporary Staffing Firm ADECCO
World's Leading HR Solutions Provider Reports Q3 2014 Results
The CEO of the world's leading provider of Human Resources solutions, Patrick De Maeseneire, recently announced the company's Q3 2014 results. Despite a slowdown in revenue growth due to currency exchange headwinds, the company reported a number of positive financial indicators.
The net income attributable to shareholders for Q3 2014 stood at EUR 198 million, marking an increase from EUR 190 million in the same period last year. This translated into a basic EPS of EUR 1.13, up from EUR 1.06.
Amortisation of intangible assets decreased to EUR 9 million in Q3 2014, down from EUR 10 million in Q3 2013.
Revenues from Career Transition (outplacement) totalled EUR 69 million, showing a 5% increase in constant currency. Permanent placement revenues also saw a significant rise, up 15% in constant currency to EUR 91 million.
The company's SG&A excluding restructuring costs increased by 2% year-on-year in constant currency, reaching EUR 674 million. Interest expense was also down, from EUR 20 million in Q3 2013 to EUR 15 million in Q3 2014.
Other income/(expenses) net saw a positive shift, rising from EUR 1 million in Q3 2013 to EUR 3 million in Q3 2014. EBITA excluding restructuring costs was EUR 280 million, and EBITA stood at EUR 275 million.
The effective tax rate remained consistent at 22% for both Q3 2014 and Q3 2013. Gross profit amounted to EUR 954 million, with a gross margin of 18.4%.
Q3 2014 revenues were EUR 5.2 billion, up 4% in constant currency. DSO remained steady at 54 days for both Q3 2014 and Q3 2013. Net debt at September 30, 2014 was EUR 1,149 million, a decrease from EUR 1,262 million at June 30, 2014.
The EBITA margin excluding restructuring costs was 5.4%. Operating income was EUR 266 million in Q3 2014, up from EUR 263 million in the same period last year. Cash flow generated from operating activities was EUR 268 million in Q3 2014, down from EUR 281 million in the same period last year.
By business line, constant currency growth was 4% in General Staffing, with Industrial up 6% and Office up 1%, and 1% in Professional Staffing. FTE employees increased by 2% compared to Q3 2013, while the branch network decreased by 1%.
Overall, while the company faced challenges due to currency exchange headwinds, its financial performance in Q3 2014 showed resilience and growth in several key areas.
The CEO, Patrick De Maeseneire, reported Q3 2014 results for the world's leading Human Resources solutions provider, showing an increase in net income attributable to shareholders and basic EPS. The company experienced growth in revenue from temporary staffing solutions (Career Transition) and permanent placement, marking a 5% and 15% rise respectively. In the financial segment, other income/(expenses) net saw an improvement, EBITA margins were maintained, and net debt decreased. Despite currency fluctuations, the business demonstrated resilience with growth in key areas. Investors might find this engaging business, with its diversified service offerings, an attractive opportunity for investing.
