PageGroup PLC · LSE:PAGE
PageGroup — Michael Page International — H1 2008 Earnings Presentation
35 slides from PageGroup's earnings presentation, August 2008
Slide 1: Interim Results 2008
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 1 Interim Results 2008 August 2008 Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Slide 2: Agenda
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 2 2008 Interim Results . ..................................... 3 2008 Financial Results ............................. 4 - 9 Agenda 2008 Segmental Analysis ..................... 10 - 18 Group Strategy ..................................... 19 - 25 Appe
Slide 3: Overview Interim Results 2008
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 3 • Record gross profits: +29% to £293m • Operating profit: +22% to £85m Overview Interim • Conversion rate*: 29.0% (2007: 30.8%) Results 2008 • Basic EPS: +28% • Interim dividend: +20% *Operating profit as a proportion of gross profit Specialists in
Slide 4: Financial Results
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 4 Financial Results Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Slide 5: Interim Income Statement 2008
A Financial Results MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 5 Interim Income Statement 2008 Constant 2008 2007 currency £m £m Change change Revenue 500.0 395.8 26.3% 17.3% Gross profit 292.7 226.5 29.2% 19.3% Operating profit 84.9 69.8 21.6% 11.4% Net interest (0.8) (0.6) Profit before tax
Slide 6: Dividends and share repurchases
A Financial Results MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 6 Dividends and share repurchases 2008 2007 (pence 2008 (pence 2007 Dividend Dividend per share) £m per share) £m growth Interim 2.88* 9.3 2.40 7.8 20.0% *Payable on 10 October 2008 H1 2008 H1 2008 H1 2007 H1 2007 Share repurchase
Slide 7: Cash Flow
A Financial Results MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 7 Cash Flow 2008 2007 £m £m Operating profit 84.1 69.2 Depreciation/share scheme charges/finance costs 10.8 7.2 Increase in receivables (25.5) (30.6) Increase in payables 1.1 13.1 Decrease in provisions – (0.1) Net cash inflow fro
Slide 8: Balance Sheet
A Financial Results MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 8 Balance Sheet 30 June 31 December 2008 2007 £m £m Tangible/intangible fixed assets 39.6 31.4 Trade and other receivables 230.1 195.1 Trade and other payables (122.5) (116.1) 107.6 79.0 Current and deferred taxes (16.6) (12.8) Ne
Slide 9: Perm/Temp analysis
A Financial Results MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 9 Perm/Temp analysis Constant 2008 2007 currency 2008 2007 Revenue £m £m Change change % share % share Permanent 242.6 186.2 30.3% 20.0% 48.5% 47.1% Temporary 257.4 209.6 22.9% 15.3% 51.5% 52.9% 500.0 395.8 26.3% 17.3% Gross profi
Slide 10: Segmental Analysis
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 10 Segmental Analysis Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Slide 11: Discipline analysis of gross profit
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 11 Discipline analysis of gross profit H1 2007 v H1 2008 Growth 300 £292.7m +65.6% 250 £226.5m +45.1% Gross Profit (£m) 200 +31.5% 150 £114.4m 100 +16.8% 50 £15.7m 0 H1 1990 H1 2000 H1 2007 H1 2008 Proportion: Engineering, P&C, P
Slide 12: Geographical analysis of gross profit
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 12 Geographical analysis of gross profit H1 2007 v H1 2008 Growth 300 £292.7m +50.1% 250 +33.5% £226.5m Gross Profit (£m) 200 +49.7% 150 £114.4m 100 50 +3.8% £15.7m 0 H1 1990 H1 2000 H1 2007 H1 2008 Proportion: Americas – 2% 7% 9
Slide 13: EMEA
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 13 EMEA H1 2007 H1 2008 Operating Profit: £28.5m +40.8% Operating Profit: £40.0m 150 H1 2007 v H1 2008 Growth* £135.4m +48% 120 +11% Gross Profit (£m) £90.4m +39% 90 +7% +53% 60 +66% £41.0m 30 +30% £6.0m 0 H1 1990 H1 2000 H1 2007
Slide 14: United Kingdom
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 14 United Kingdom H1 2007 H1 2008 Operating Profit: £28.6m -0.7% Operating Profit: £28.4m H1 2007 v H1 2008 £95.6m Growth* £92.0m +39% 80 +11% Gross Profit (£m) 60 £57.3m +11% 40 20 -5% £8.6m 0 H1 1990 H1 2000 H1 2007 H1 2008 Pro
Slide 15: Asia Pacific
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 15 Asia Pacific H1 2007 H1 2008 Operating Profit: £9.8m +30.6% Operating Profit: £12.9m 40 H1 2007 v H1 2008 Growth* £36.0m 30 Gross Profit (£m) £27.0m +13% 20 £13.6m 10 +27% £1.1m 0 H1 1990 H1 2000 H1 2007 H1 2008 Proportion: As
Slide 16: The Americas
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 16 The Americas H1 2007 H1 2008 Operating Profit: £2.9m +24.1% Operating Profit: £3.6m 30 H1 2007 v H1 2008 Growth* £25.7m Gross Profit (£m) 20 +57% £17.1m 10 +25% £2.4m £nil 0 H1 1990 H1 2000 H1 2007 H1 2008 Proportion: Latin Am
Slide 17: Headcount - Quick to react to market conditions
A SEGMENTAL ANALYSIS MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 17 Headcount - Quick to react to market conditions Headcount Growth Rates (%) 12 10 8 6 4 Mar 2008 vs Dec 2007 2 June 2008 vs Mar 2008 July 2008 vs June 2008 0 -2 -4 EMEA UK Asia Pacific Americas Total EMEA UK Asia Pacific Americ
Slide 18: Current Trading
2008 INITIATIVES MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 18 Current Trading • Continue to make strategic decisions for long-term good of the Group “The first half of the year produced record • Flexible approach to deployment of results for the Group and a number of senior personnel excelle
Slide 19: Group Strategy
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 19 Group Strategy Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Slide 20: Michael Page International Strategy
GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 20 To increase the diversification of Michael Page International by organically growing existing and Michael Page International new teams, offices, disciplines and Strategy countries with a consistent team and meritocratic culture and
Slide 21: Increasing the business diversification 2003 to H1 2008
A GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 21 Increasing the business diversification 2003 to H1 2008 Gross Profit Country Disciplines 32% 73 68% 178 A third of our gross profit now comes from businesses Businesses existing in 2003 created since the last downturn. In this per
Slide 22: Discipline diversification by country
A GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 22 Increasing the business diversification 2003 to H1 2008 Discipline diversification by country 15 2008 (5,535 staff) 2003 (2,260 staff) 12 Number of disciplines 9 6 3 0 ina re A an zil a a o l nd en d d ica E urg a ia nd y UK alia
Slide 23: Increasing the business diversification 2003 to H1 2008
A GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 23 Increasing the business diversification 2003 to H1 2008 Offices Countries 61 12 16 105 Since the last downturn our consistent diversification Businesses existing in 2003 strategy has increased the number of countries by 75% and Ne
Slide 24: Diversification 2003: 105 offices, 16 countries
A GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 24 Increasing the business diversification 2003 to H1 2008 GERMANY UNITED KINGDOM Berlin Basingstoke Dusseldorf Birmingham Frankfurt Brighton Munich Bristol Bromley Cambridge THE NETHERLANDS Chelmsford 2003 Amsterdam Coventry Eindhov
Slide 25: Diversification 2008: 166 offices, 28 countries
A GROUP STRATEGY MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 25 Increasing the business diversification 2003 to H1 2008 GERMANY Berlin UNITED KINGDOM Dusseldorf Aberdeen Reading Frankfurt Basingstoke Sheffield Hamburg Birmingham Slough Munich Brighton Southampton Stuttgart Bristol St Albans TH
Slide 26: Appendix
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 26 Appendix Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Slide 27: Clear on Brand
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 27 Clear on Brand Executive Search 28 Countries 104 Offices Qualified Professional 3,236 Fee Earners 10 Countries 84 Offices 964 Fee Earners Clerical Professional Generalist Staffing Specialists in Global Recruitment 166 offices in 28 coun
Slide 28: Flexible with headcount
APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 28 • 865 teams worldwide, typically a Manager and 3 Consultants • Manager has full P&L responsibility for team • Significant share of profit each quarter allocated to team as bonus • Individual bonuses allocated subjectively, based on contri
Slide 29: Long term on investment
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 29 Long term on investment 1996 2001 2006 Singapore Switzerland South Africa Japan Russia Ireland 2008 1976 1985 1993 1998 2002 U.A.E. Austria United Kingdom Australia Germany USA Belgium Mexico Turkey Sweden New Zealand 1997 2000 2005 200
Slide 30: Consistent over time
APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 30 • No acquisitions, one IT platform, one culture, one remuneration strategy • Consistent recruitment, training, development to ensure consistent quality of fee earners Consistent over time • Consistent brand strategy • Organic growth, home
Slide 31: Deep in experience
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 31 Deep in experience Senior Operational Management No. Tenure in MP Executive Directors Managing Directors Executive Directors 2 22 years Regional Managing Directors Directors Regional Managing 13 17 years Directors Managing Directors 28
Slide 32: Group quarterly gross profit trend: Q1 2001 to Q2 2008
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 32 Group quarterly gross profit trend: Q1 2001 to Q2 2008 200 152.4 140.3 150 128.2 123.4 121.0 G ro ss Profit (£m) 105.5 93.1 100 89.1 87.4 79.2 70.2 69.2 69.6 68.3 66.9 59.9 58.7 56.7 53.5 52.3 51.4 49.9 49.5 48.1 47.8 45.7 45.0 45.0 43.
Slide 33: Scope for Growth: Headcount
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 33 Scope for Growth: Headcount 5000 Ratio Fee earners: Non Fee earners Fee Earners 1999 59:41 2000 58:42 Non-Fee Earners 2001 57:43 4000 2002 58:42 2003 60:40 2004 64:36 2005 71:29 3000 2006 74:26 Headcount 2007 76:24 H1 2008 76:24 2000 10
Slide 34: Scope for Growth: Conversion
A APPENDIX MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 34 Scope for Growth: Conversion 40% Operating Profit (excl all share based charges) Operating Profit (incl share based charges) 30% 20% Conversion rates before share based charges H1 2007 H1 2008 EMEA 34.0 30.7 10% UK 32.5 32.4 Asia Pac 37
Slide 35: MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 35 Specialists in Global Recruitment
MICHAEL PAGE INTERNATIONAL INTERIM RESULTS 2008 | 35 Specialists in Global Recruitment 166 offices in 28 countries | www.michaelpage.co.uk
Michael Page International — H1 2008 Earnings Presentation on 6ix