FTSE 250-listed recruitment firm Hays PLC (LSE:HAS) faced tough trading conditions in the second quarter with a 12% year-on-year decline in group fees, according to an update published on Tuesday.
This downturn was primarily observed in the Permanent recruitment segment, though Temporary volumes also plummeted.
The UK and Ireland division saw a 17% decrease in fees, while the Australia & New Zealand and the Rest of World divisions reported declines of 20% and 11% respectively.
Hays has implemented significant cost reduction and efficiency measures in response to these challenging conditions.
A consultant headcount reduction operation led to approximately £30 million in annualised savings, though this has come with an exceptional restructuring charge of around £12 million.
"Overall market conditions became increasingly challenging through the quarter, including a clear slowdown in most markets in December, notably in our Perm businesses as client and candidate decision-making slowed,” stated chief executive Dirk Hahn.
“Temp volumes remained broadly stable sequentially through the quarter, but declined year on year as we did not see our normal seasonal step-up in worker volumes.”
As a result of these market headwinds, Hays expects an underwhelming first-half operating profit of £60 million, despite ongoing actions to reduce costs.