January 11, 2017 / 8:04 AM / 2 years ago

UPDATE 1-Recruiter PageGroup's Q4 gross profit rises, UK disappoints

(Adds details, context)

Jan 11 (Reuters) - British recruitment firm PageGroup Plc reported a rise in fourth-quarter gross profit, but pointed to a continued cooling in the UK hiring market after Britons backed an exit from the European Union.

The company said it expected full-year operating profit to be towards the top end of company compiled forecasts of between 91 million pounds and 100 million pounds.

PageGroup, which mainly finds candidates to fill permanent positions, said year-on-year gross profit from its British operations fell 6.7 percent to 33.8 million pounds ($41.1 million) at constant currencies in the quarter, steeper than the 4.7 percent fall seen in the preceding quarter.

“In the UK, client and candidate confidence levels deteriorated further, with activity levels also reduced,” Chief Executive Steve Ingham said.

Contrastingly, PageGroup’s peer Robert Walters on Monday reported a rise in UK gross profit, helped by growth in its domestic outsourcing business and said the UK hiring market was picking up pace as Brexit “uncertainty” started becoming the “new normal”.

PageGroup’s total gross profit rose 3.8 percent at constant currencies in the quarter, driven by growth in Continental Europe and Latin America, outside Brazil.

Positive foreign exchange movements bumped up reported gross profit by 22.4 million pounds in the quarter, the company said.

Staffing firms such as PageGroup, Hays, SThree and Robert Walters are seen as gauges of wider economic health because people tend to switch jobs more often when confidence rises.

Although most British staffing companies have been hit by uncertainty following the surprise Brexit vote in June, their international businesses have continued to offer protection.

PageGroup’s quarterly gross profit from Europe, the Middle East and Africa (EMEA) business rose 12.4 percent to 76 million pounds at constant currencies, indicating that the rest of the continent continued to stay protected against any Brexit fall out.

EMEA accounted for 47 percent of its gross profit in the quarter, while UK accounted for 21 percent.

Seven countries in the region had record quarters and 12 had record years, PageGroup said.

Total gross profit for the year rose 3 percent at constant currencies to 621.1 million pounds. ($1 = 0.8230 pounds) (Reporting by Noor Zainab Hussain and Esha Vaish in Bengaluru; Editing by Sunil Nair and Gopakumar Warrier)

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