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Adecco narrowly meets its quarterly targets

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Adecco, a provider of personnel services based in Glattbrugg, presented today its results for the second quarter of the year. Firstly some facts: Adecco’s revenue grew organically during the reporting period by 4% to 5,696m EUR (by 3% trading days adjusted), gross profit rose by 5% to 1,071m EUR and the EBITA (adjusted) improved organically to 284m EUR – meaning a rise of 6%. The net income also grew by 7% as reported to 190m EUR. Furthermore, CEO Alain Dehaze announced that the published Q2 results were „solid“ and that the company maintains its price discipline and strict cost controlling. Dehaze also confirmed the mid-term targets: an organic growth at least in line with the main competitors, improving EBITA margin from 4.5% to 5% and an operating cash flow conversion of more than 90%, all to be achieved through-the-cycle.

However, on closer examination the results reveal an alarming slowdown in activity in France (+3%) and in North America (-1%), the two largest markets for Adecco. In addition, although sales increased by 6% in the last quarter in the UK, the third largest market for Adecco, the economic outlook remains highly uncertain after the Brexit vote. The management outlook also recognizes this referring to an „uncertain global economic outlook“.

All in all, the published quarterly results narrowly meet the expectations but the outlook gives rise to concerns.

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