Robert Walters Reports Weaker Q2 Trading Amid Macroeconomic Uncertainty
Why we think this is bad
The trading update from Robert Walters indicates a challenging quarter, with net fee income down 13% year-on-year in constant currency terms. The company noted that macroeconomic uncertainty became more pronounced in Q2, with forward indicators such as new job flow and interviews slightly weaker compared to the end of Q1. This suggests a deteriorating trading environment, which is reflected in the lower net fee income across the group's key regions. The company has also taken further strategic actions to drive greater efficiency, including closing operations in Brazil and removing management layers in other specialist recruitment markets. Overall, the tone of the update is cautious, highlighting the impact of the uncertain macroeconomic conditions on the group's performance.
Key Points
- Q2 Group net fee income down 13% in constant currency terms
- Macroeconomic uncertainty more pronounced, with forward indicators slightly weaker compared to Q1
- Specialist professional recruitment net fee income down 14%, with permanent down 16% and temporary down 13%
- Recruitment outsourcing net fee income down 6%, with perm volume hiring (RPO) flat
- Further strategic actions implemented to drive greater efficiency, including closing operations in Brazil
- Exited H1 with monthly operating cost base of £24.5m, down from c.£25m at end of 2024, with further cost reductions planned
Summary
Robert Walters reported a 13% year-on-year decline in Q2 net fee income in constant currency terms, as macroeconomic uncertainty became more pronounced. The company noted that forward indicators such as new job flow and interviews were slightly weaker compared to the end of Q1. The group has taken further strategic actions to drive greater efficiency, including closing operations in Brazil and removing management layers in other specialist recruitment markets. The company exited the first half with a monthly operating cost base of £24.5m, down from c.£25m at the end of 2024, and plans further cost reductions in the second half. The group remains focused on its strategic initiatives to strengthen the business, including improving fee earner productivity, driving efficiencies, and optimising its office network.