PRELIMINARY RESULTS 2006

Transcription

1 LONDON PARIS SYDNEY NEW YORK PRELIMINARY RESULTS 2006 February 2007

2 Agenda LONDON Financial Highlights... 3 Financial Results and Segmental Analysis Geographical Review Our Investment Strategy Current Trading Appendix

3 Financial Highlights TORONTO Change Turnover 649.1m 523.8m 24% Gross profit 348.8m 267.6m 30% Operating profit 97.4m 66.5m 46% Profit before tax 97.0m 66.1m 47% Basic earnings per share (pence) % Diluted earnings per share (pence) % Dividends (pence) % 3

4 LONDON PARIS SYDNEY NEW YORK FINANCIAL RESULTS AND SEGMENTAL ANALYSIS

5 Profit and Loss MADRID 2006 m 2005 m Change Turnover % Gross profit % Operating profit % Net interest expense (0.4) (0.4) Profit before tax % Taxation (31.5) (16.5) 90.9% Profit after tax % Effective tax rate on profit 32.5% 25.0% Effective tax rate was lower in 2005 due to utilisation of prior year tax loss. 5

6 Earnings per share and dividends MILAN Earnings per share Change Basic (pence) % Diluted (pence) % Weighted average number of shares Basic (000 s) 334, ,283 Diluted (000 s) 343, ,297 Dividend Interim - pence per share Final - pence per share 4.2* 3.5 Total - pence per share % *Payable on 5 June

7 Share Repurchases and Share Options LONDON Share Repurchases Repurchased and cancelled 23.3m shares (7.0% of total share capital) in the year Total cost of repurchases 83.4m Average repurchase price 355.8p per share Range of prices 307.3p to 404.0p Share Options Options exercised over 23.9m shares (7.2%) in 2006 with proceeds of 38.2m 3.5m options (1.0%) vested but not exercised Further 11.0m options (3.3%) outstanding 7

8 Cash Flow PARIS 2006 m 2005 m Operating profit Depreciation/share scheme charges Net movement in working capital (28.7) (8.5) Profit on sale of business (0.6) Decrease in provisions (0.4) (0.6) Net cash inflow from operating activities Net interest expense (0.4) (0.4) Taxation paid (21.7) (10.1) Proceeds from sale of business 1.4 Net capital expenditure (8.7) (6.8) Dividends paid (18.1) (14.4) Issue of own shares for share options 38.2 Purchase of own shares (83.4) (34.2) Net cash outflow (15.2) 0.9 8

9 Balance Sheet SAO PAULO 31 December 2006 m 31 December 2005 m Intangible assets - Goodwill Computer software Tangible assets Trade and other receivables Trade and other payables (84.7) (72.3) Current and deferred taxes (2.0) (0.8) Net (debt)/cash (3.6) 13.1 Provisions (0.2) (0.6) Net assets

10 Discipline Analysis of Gross Profit SHANGHAI Gross profit 2006 m 2005 m Change 2006 % share 2005 % share Finance & Accounting % 58.0% 59.6% Marketing, Sales, Retail % 19.5% 20.6% Legal, Technology, HR, Secretarial and Other % 13.4% 11.9% Engineering, Property & Construction, Procurement & Supply Chain % 9.1% 7.9% % 10

11 Perm/Temp analysis SINGAPORE Turnover 2006 m 2005 m Change 2006 % share 2005 % share Permanent % 42.6% 39.2% Temporary % 57.4% 60.8% % Gross profit Permanent % 74.8% 72.9% Temporary % 25.2% 27.1% % Gross margin Group 53.7% 51.1% Permanent 94.4% 94.9% Temporary 23.6% 22.8% 11

12 LONDON PARIS SYDNEY NEW YORK GEOGRAPHICAL REVIEW

13 Geographical analysis of gross profit LONDON GP: 267.6m GP: 348.8m 14.6% 4.8% 12.9% 6.2% 48.4% 30.4% Growth 44.7% 32.2% 36.3% United Kingdom +20.3% EMEA +46.9% Asia Pacific +15.2% Americas +66.8% 13

14 United Kingdom LONDON Turnover: 269.6m Turnover: 312.4m Gross Profit: 129.5m Gross Profit: 155.8m Headcount: 1,318 Headcount: 1,537 12% 5% Gross profit 15% 5% 3% 4% 57% 20.3% Growth 54% 22% 21% Finance & Accounting +14% Marketing, Sales & Retail +14% Legal, HR, Technology, Secretarial and Other Engineering, Property & Construction, Procurement & Supply Chain +42% +42% Scotland +62% 14

15 EMEA MILAN Turnover: 159.2m Turnover: 223.0m Gross Profit: 86.1m Gross Profit: 126.6m Headcount: 1,041 Headcount: 1,438 16% Gross profit 19% 11% 46% 46.9% Growth 12% 38% 9% 9% 9% France +22% Holland +76% Belgium, Switzerland, South Africa, UAE, Sweden, Poland, Portugal, Russia, Ireland +112% Germany +60% Spain +66% Italy +21% 11% 8% 12% 15

16 Asia Pacific TOKYO Turnover: 76.7m Turnover: 83.6m Gross Profit: 39.0m Gross Profit: 45.0m Headcount: 359 Headcount: 441 Gross profit 37% 63% 15.2% Growth 42% 58% Australia +5% Rest of Asia Pacific +32% 16

17 Australia Overview WHEELERS HILL Gross profit performance AUS$ Q1 +26% +6% Q2 +22% +2% Q3 +11% +3% Q4-7% +24% New Management team installed in Q3 Restructured by discipline rather than by geography in Q4 Expect benefits to become gradually evident as 2007 progresses Weak Q comparator 17

18 The Americas PHILADELPHIA Turnover: 18.3m Turnover: 30.1m Gross Profit: 12.9m Gross Profit: 21.5m Headcount: 208 Headcount: 342 Gross profit 66.8% Growth 42% 58% 40% 60% North America +73% Latin America +58% 18

19 LONDON PARIS SYDNEY NEW YORK OUR INVESTMENT STRATEGY

20 Michael Page International - Strategy LONDON To organically grow existing and new teams, offices, disciplines and countries with a consistent team and meritocratic culture Teams Countries Culture Offices Disciplines 20

21 30 years of organic growth GENEVA Turnover m* Operating Profit m* Average number of staff ,305 *as reported. 21

22 30 years of organic growth: Disciplines MANCHESTER Finance & Accounting Finance & Accounting Finance & Accounting Banking Banking Banking Legal Legal Legal Marketing Marketing Marketing Sales Technology Sales Technology Engineering & Manufacturing Procurement & Supply Chain Property & Construction Human Resources Retail Secretarial Hotel and Catering Healthcare 22

23 30 years of organic growth: Countries BRUSSELS UK UK UK Australia Australia Australia France France France Holland Holland Germany Germany China China Singapore *Added January 2007 Singapore Spain USA Italy Brazil Portugal Switzerland Japan Sweden Belgium Poland Canada Mexico Russia Republic of Ireland South Africa United Arab Emirates Luxembourg* 23

24 Rolling out the global strategy FRANKFURT Increase revenue from existing consultants New consultants into existing teams New teams into existing offices, e.g. MP Finance teams in New York, Boston, New Jersey, Stamford, Amsterdam, Dusseldorf, Frankfurt Rolling out existing disciplines into existing offices, e.g. MP Property & Construction in Toulouse, Rio MP Engineering into Liverpool, Campinas MP HR into Leeds, Edinburgh, Rotterdam MP Technology into Rotterdam, Eindhoven, Amersfoort Launching new disciplines into existing offices e.g. MP HR and MP Technology in Japan MP Sales and Marketing, MP HR & MP Engineering into USA MP Sales and Marketing into Switzerland Opening new offices in an existing country e.g. Sha Tin, Sheffield, Peterborough, Cardiff, Utrecht, Antwerp, Toulouse, Campinas Launching new countries in an existing region e.g. Dubai, Dublin, Moscow, Johannesburg, Mexico City 24

25 2006 Spread of Investment MILAN Allocation of the new headcount Estimated New consultants, existing teams 50% New teams/disciplines, existing offices 20% New disciplines, existing countries 15% New office, existing countries 10% New countries 5% Including bonuses and share based charges approximately 75% of costs are staff related. 25

26 Return on investment New Consultant Typically Month 3 Profitable ROTTERDAM New Team, Existing Office Typically 2nd Quarter Profitable New Office, Existing Country Typically Year 1 Profitable New Discipline, Existing Country Typically Year 1 Breakeven Typically Year 2 Profitable New Country Typically Year 1 Loss (0.3m) Typically Year 2 Typically Year 3 Breakeven Profitable 26

27 Depth of management resource to drive organic growth Senior Management No. Tenure in MP LISBON Executive Directors 3 15 years Regional Managing Directors 9 16 years Managing Directors years Directors 98 9 years 140 Average c.10 years Retained by: Culture fit Clear long term career paths International opportunities LTIP (MD and above) Share options (Directors) 27

28 Investment in management resource To fuel growth in existing region, e.g. The Americas CONNECTICUT Alexi de Bretteville (8/06) RMD (14 years) Americas Ex N. Europe, S. Europe, France Patrick Hollard (7/00) MD (10 years) Latin America USA Mark Sharland (8/05) MD (18 years) Canada Ex UK Christophe Rosset (6/06) MD (10 years) Mexico Ex France Patrick Hollard (7/00) Brazil Ex Spain, France Joost Fortuin (3/07) MD (10 years) Southern USA Ex Holland Richard Vickers (1/07) MD (12 years) Eastern USA Ex UK Phillipe Perret (8/06) Dir. (12 years) Mid West USA Ex France Nigel Milford (8/05) Dir. (20 years) Ex UK, Hong Kong Lawrence Pengally (1/04) Dir. (12 years) Finance Ex UK 138 years of Michael Page experience Simon Lewis (5/03) Dir. (12 years) Banking Ex Japan, Hong Kong, UK Huw Rothwell (4/01) Dir. (8 years) HR Ex UK 28

29 Investment in new countries Mexico, Russia, South Africa, UAE, Republic of Ireland JOHANNESBURG Managing Director responsible averages 13 years at MP All ahead of plan Typically 5 to 10 people in each country Limited/fragmented competition Serviced offices moving to leased premises Target multi-national clients initially Capitalise on global candidate database Collectively should be c.120 people year end 2007 Huge potential, long term investment 29

30 Headcount - Operational Gearing LONDON SYDNEY 30

31 LONDON PARIS SYDNEY NEW YORK CURRENT TRADING

32 Current trading TORONTO Good activity levels continue in all regions MP job count at end of Feb 2007 c. 39,000 (Feb 2006: c. 27,000) Since year end opened: - New country - Luxembourg - New offices - Hamburg, Hartford (Connecticut), Leicester Continue to invest in our businesses for future growth Headcount increase to around 4,500 expected by year end 2007 pre-bonus cost-base of aprox. 260m Q1 trading update will be issued on 5 April 2007 The successful 30 year strategy continues! 32

33 LONDON PARIS SYDNEY NEW YORK APPENDIX

34 Appendix Agenda JOHANNESBURG Michael Page International Overview Geographical Review Global MP Job Count and Quarterly Gross Profit Trend Scope for Growth: UK Offices; Global Disiplines; Global Offices; Conversion Share Based Payments and Share Options

35 Michael Page International Overview AMSTERDAM Specialist recruitment company focused on placing white-collar professionals into permanent, contract and temporary positions: - Gross profit ratio 75:25 Perm/Temp Specialisms: Finance & Accounting, Banking, Legal, Marketing, Sales, Technology, Engineering & Manufacturing, Procurement & Supply Chain, Property & Construction, Human Resources, Retail, Secretarial, Hotel and Catering and Healthcare Year end offices in 23 countries More than 3,700 employees: 41% UK, 38% EMEA, 12% Asia Pacific, 9% Americas Strong and diversified client base >90% of FTSE 100 and FTSE Eurotop 300 Extensive global database of more than a million potentially placeable candidates Market leading global specialist white-collar website currently carrying more than 39,000 jobs 35

36 Positioning BRUSSELS Executive Search Korn Ferry Egon Zehnder Spencer Stuart Whitehead Mann Russell Reynolds VALUE ADDED SALARY AND REMUNERATION Qualified Professional Recruitment Clerical Staffing (Professional) Harvey Nash OPD SThree Robert Walters Mercuri Urval Hudson Hays Reed Robert Half HIGHER FEES Generalist Staffing (Other) Adecco Manpower Randstad Kelly Vedior 36

37 Power of the Brand FRANKFURT One of the strongest global brands in recruitment Leading advertiser in the Financial Times (UK), South China Morning Post, Straits Times (Singapore), The Melbourne Age, The Sydney Morning Herald, The Australian Financial Review, FT (Deutschland), Süddeutsche Zeitung, FAZ (Deutschland), Les Echos, Le Figaro and Intermediare Voted one of Britain s strongest B2B brands since Superbrands Sunday Times 100 Best Companies to work for 2005 and 2006 Voted one of Britain s Top Employers 2005 (as published in the book by the Guardian) The brand drives organic growth Attracts the best clients, candidates and employees Facilitates organic expansion in existing markets and entry into new markets 37

38 Power of the Brand Online Globally per month: GENEVA 10 million Page Views 2.2 million Visitors 167,000 Job Apps/General CV Submissions website as at 23 Feb 07 38

39 Current Clients advertising on the MP website LONDON 39

40 Geographical analysis of gross profit TOKYO 2006 m 2005 m Change 2006 % share 2005 % share United Kingdom % 44.7% 48.4% EMEA % 36.3% 32.2% Asia Pacific % 12.9% 14.6% Americas % 6.2% 4.8% % 40

41 United Kingdom Preliminary Results 2006 MANCHESTER 2006 m 2005 m Change Turnover % Gross profit % Operating profit before share based charges % Share based charges (4.4) (2.7) Operating profit % Operating margin before share based charges 31.3% 26.7% Operating margin 28.4% 24.7% Headcount at year end 1,537 1, % 41

42 EMEA Preliminary Results 2006 ROTTERDAM 2006 m 2005 m Change Turnover % Gross profit % Operating profit % Operating margin 27.0% 22.6% Headcount at year end 1,438 1, % 42

43 Asia Pacific Preliminary Results 2006 PARRAMATTA 2006 m 2005 m Change Turnover % Gross profit % Operating profit % Operating margin 37.9% 36.1% Headcount at year end % 43

44 The Americas Preliminary Results 2006 SAO PAULO 2006 m 2005 m Change Turnover % Gross profit % Operating profit % Operating margin 8.7% 8.0% Headcount at year end % 44

45 Global MP Job Count: Website LONDON MANCHESTER Only MP jobs, not total Group Mix of Perm and Temp 45

46 Group quarterly gross profit trend Q to Q LONDON SINGAPORE Gross Profit ( m) Q1 Q2 Q Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q Q4 46

47 Scope for Growth NEW YORK Number of UK offices per discipline Added during Number of offices Accountancy Additions Finance Legal Secretarial City Marketing Sales Retail Human Resources Engineering & Manufacturing Procurement & Supply Chain Property & Construction Technology 47

48 Scope for Growth Number of disciplines in each country Relative size of economies Vs. UK by GDP France 1.0x Sweden 0.2x FRANKFURT Spain 0.5x Portugal 0.1x 20 Netherlands 0.3x Poland 0.1x Australia 0.3x Canada 0.5x United States 5.6x Japan 2.0x Germany 1.3x Singapore 0.1x Italy 0.8x Switzerland 0.2x Mexico 0.3x Russia 0.3x Number of disciplines China 4.8x Ireland 0.1x Brazil 0.4x South Africa 0.1x Belgium 0.2x UAE 0.1x Added during UK France Spain Netherlands Australia USA Germany Italy Switzerland China Brazil Belgium Sweden Portugal Poland Canada Japan Singapore Mexico Russia Ireland South Africa UAE 48

49 Scope for Growth Number of offices in each country STOCKHOLM Number of offices Relative size of economies Vs. UK by GDP France 1.0x Sweden 0.2x Spain 0.5x Portugal 0.1x Netherlands 0.3x Poland 0.1x Australia 0.3x Canada 0.5x United States 5.6x Japan 2.0x Germany 1.3x Singapore 0.1x Italy 0.8x Mexico 0.3x Switzerland 0.2x Russia 0.3x China 4.8x Ireland 0.1x Brazil 0.4x South Africa 0.1x Belgium 0.2x UAE 0.1x 10 UK France Spain Netherlands Australia USA Germany Italy 3 2 Switzerland 3 2 China 3 2 Brazil 2 1 Belgium Sweden Portugal Poland Canada Added during Japan Singapore Mexico 1 1 Russia 1 1 Ireland South Africa 1 UAE 49

50 Scope for Growth - Conversion LONDON STOCKHOLM Operating Profit (excl all share based costs) Operating Profit (after all share based costs) Operating Profit (after Share Option costs) 50

51 Share Based Payment Charges LISBON Share options charge 4.6m (2005: 2.9m) 2006 charge higher due largely to increased social charges as a consequence of higher share price p at 31 December 2006 (31 December 2005: 270.0p) LTIP* and Deferred Bonus Plan* charge 3.7m (2005: 1.5m) 2006 charge higher due to greater profits increasing the awards and increased social charges as a consequence of higher share price * Approved by shareholders in December

52 Share options Summary of Exercised and Outstanding Share Options at 31 December 2006 LONDON 2001 IPO Options Shares (m) Shares (m) Earliest exercise dates for non-vested share options % of total share capital Vested of which exercised Unvested Total Original grants

53 LONDON PARIS SYDNEY NEW YORK