ZURICH (Reuters) – Adecco Group (ADEN.S) reported weaker-than-expected first-quarter earnings as the world’s largest staffing company said revenue grew at an underlying 5-6 percent rate in March and April.
Switzerland-based Adecco said its revenue fell 1 percent in reported terms and rose 4 percent on an organic basis in the three months ended March 31 to 5.69 billion euros ($6.78 billion), in line with the average estimate in a Reuters poll of analysts.
Adjusted for trading days, organic growth was 6 percent in the first quarter, it said in a statement. Revenues in March and April were up 5-6 percent, also organically and trading-days adjusted.
That reflects a slowdown from the 7 percent increase in the last three months of 2017.
“The slight deceleration was driven in particular by North America, UK & Ireland General Staffing and Italy. Permanent placement performance remained strong, with revenues up 18 percent organically,” it said.
First-quarter net income fell 26 percent to 130 million euros, missing the poll estimate of 149 million.
Adecco’s EBITA operating margin excluding one-offs was down a percentage point to 3.8 percent due to a lower gross margin, staff costs and strategic investments, it said.
It said the trend would improve from the second quarter as the impact of investment wanes and bank holidays turn favorable.
Last month, Dutch rival Randstad (RAND.AS) reported 7.4 percent organic revenue growth and said that pace had been roughly maintained in April.
U.S. peer Manpower (MAN.N) meanwhile reported a 5 percent increase in first quarter revenue when adjusted for currency swings.
Reporting by Michael Shields and John Revill, editing by John Miller