Hays PLC (LSE:HAS), the recruitment firm, has confirmed it is to pay a special dividend of 8.93p after a “dramatic” recovery by its markets from the pandemic.
The company had flagged in its half-year results its intention to spend £100mln on a special dividend and resume dividend payments this year and it made good on those promises in its full-year results, released this morning.
Net fees in the year to the end of June eased 8% to £918.1mln from £996.2mln the year before. Fees in the first half of the fiscal year were down 24% year-on-year but recovered strongly in the second half, rising 13%, with the fourth quarter seeing fees running 39% higher than in the same period of 2020.
Temporary placements, which generated 61% of group fees, were described as “relatively resilient” with fees down 6% (but up 9% in the second half) while Permanent placements saw a strong rebound in the second half of the fiscal year, rising by 18% year-on-year to reduce the full-year decline to 10%.
Cash generated by operations fell 47% to £130.8mln from £247.4mln the previous year, but the board felt confident enough of its cash buffer to recommend the payment of an interim dividend of 1.22p.
Profit before tax rose 2% to £88.1mln from £86.3mln in the prior year.
“As business and candidate confidence increased globally, our management actions drove record consultant productivity, leading to a strong recovery in fees and profits. This included our largest markets of Germany, Australia and the UK, while in RoW [the rest of the world] six countries delivered record fee performances, including the USA, and many countries exited the year with fee run-rates above pre-Covid levels. Across all our regions there are clear signs of skill shortages and wage inflation in certain industries, particularly Technology and Life Sciences,” said Alistair Cox, the chief executive of Hays.
"We start our new financial year with good momentum,” Cox said.
“While retaining operational rigour, we are adding consultant capacity to both capitalise on the cyclical recovery and to accelerate our development in highly attractive structural growth markets. Overall, the strength of the recovery has been dramatic. We now see a clear route back to, and then exceeding, pre-pandemic levels of profit, faster than we envisaged even six months ago,” Cox said.
Shares in Hays were up 0.4% at 157.6p in the first hour of trading.