By Shashwat Awasthi
(Reuters) -British recruiter PageGroup issued its second profit warning in six months on Monday, citing deteriorating conditions especially in France and Germany and continuing uncertainty in its other main markets.
The FTSE 250 firm’s stock fell as much as 5% to 295.8 pence, the lowest level since May 2020, pulling London-listed rivals Hays and Robert Walters to their lowest since June 2013 and April 2020, respectively.
France has endured a year of political upheaval while Germany is mired in an economic downturn and also faces a snap election. The two countries together make up more than a quarter of PageGroup’s earnings.
Potential trade tariffs by the incoming administration of U.S. President-elect Donald Trump are another concern for European firms.
“With the threat of Trump’s trade tariffs hovering over Europe, and the potential impact of AI on a whole host of jobs still unclear, it’s not surprising that firms are staying cautious about hiring,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
PageGroup noted that earnings in the United States grew for the first time in two years in the fourth quarter but Chief Executive Nicholas Kirk cautioned that it was too soon to label it a sustained recovery.
“Clearly, we’re pleased to see growth…but…I wouldn’t call it a trend at the moment,” he said on a conference call.
“We’ll see how things progress through Q1…and then perhaps if we’ve had two quarters of growth in a row, then maybe that does become a trend.”
PageGroup now expects annual adjusted operating profit at the lower end of market consensus of between 49 million pounds ($59.5 million) and 58.5 million pounds. It had earlier forecast earnings of 58 million pounds.
Robert Walters and Hays will release trading updates later this week.
($1 = 0.8231 pounds)
(Reporting by Shashwat Awasthi and Prerna Bedi; Editing by Sherry Jacob-Phillips, Kirsten Donovan)
