Hays plc (LON:HAS) (HAS.L) has released a Q4 update today which shows overall growth of 7%, with underlying growth of 9% when adjusted for working days. The quarter was a record quarterly net fee performance for the company.
In terms of regions, LFL growth in Asia pacific was 11%, as was Continental Europe and the Rest of World region. However, in the UK and Ireland, growth was (5%), which is obviously a disappointing result.
By segment, Temporary reported a LFL rise in sales of 6%, while Permanent was 7%. This contributed to full year operating profit which is expected to be marginally ahead of current expectations, which is around £209.5 million.
Hays increased its consultant headcount by 10% year-on-year, with strong cash performance. It ends the year with a net cash position of £110 million. This shows it has a relatively strong balance sheet in my opinion.
The company’s update reports that conditions remain good in the majority of international markets. Although the UK’s performance in the quarter was disappointing, trading conditions in the UK remain stable.
In the last year, the Hays share price has risen 44%. That’s ahead of other global stocks such as Unilever plc (LON:ULVR) (ULVR.L), Imperial Brands PLC (LON:IMB) (IMB.L) and Rolls-Royce Holding PLC (LON:RR) (RR.L). The Unilever share price is 20% higher, Imperial Brands is down 12% and Rolls-Royce has gained 23%.
In my opinion, Hays has investment appeal for the long run. I believe the company offers a mix of diversity and growth potential. Its performance in Asia Pacific was particularly encouraging in my view, and could help to offset a lacklustre performance in the UK. With a net cash position and what I view as a sound business model, I feel upbeat about the company’s outlook on a relative basis over a long time period.