Slide 1: Q3 results: digital strategy in full swing
Q3 results digital strategy in full swing. Randstad analyst breakfast Jacques van den Broek, CEO Henry Schirmer, CFO Randstad N.V. 24 October 2018
Slide 2: financial results & outlook
financial results & outlook. © Randstad 2018 | 2
Slide 3: Q3 2018 further EBITA margin progression
Q3 2018 further EBITA margin progression. mixed growth, digital strategy in full growth drivers strong conversion swing organic growth 2.7% professionals up 6% EBITA € 299m perm up 13% EBITA margin 5.0% NAM and ROW accelerating © Randstad 2018 | 3
Slide 4: Q3 2018 delivering on operational leverage
Q3 2018 delivering on operational leverage. Q3 performance Q3 highlights € million Q3 ’18 Q3 ’17 % org. revenue 6,006 5,872 3% • solid revenue growth gross profit 1,191 1,178 2% gross margin 19.8% 20.1% • EBITA margin up 10bp YoY operating expenses* 892 891 1% opex % 14.9% 15.2% • agile opex steerin
Slide 5: Q3 2018 gross margin: underlying stable - impacted by mix
Q3 2018 gross margin: underlying stable - impacted by mix. Q3 gross margin development YoY Q3 highlights • temp margin down 20bp: mix/price -10bp, CICE -10bp • perm fees grew 13% YoY organically, adding 20bp • HRS/Monster impact -20bp, driven primarily by Monster © Randstad 2018 | 5
Slide 6: agile cost management in Q3
agile cost management in Q3. Q3 sequential opex bridge Q3 cost management • organic opex decreased 2% vs. Q2 (+1% YoY) • productivity (GP/FTE) stable • on track to deliver cost savings program © Randstad 2018 | 6
Slide 7: resilient free cash flow and balance sheet
resilient free cash flow and balance sheet. improved free cash flow YoY strong balance sheet • FCF € 220m (+24% vs. Q3 2017) • net debt € 1,419m • WC improvement € 35m YoY • special dividend € 126m paid in Q3 • DSO 54, up 1.5 days due to mix effects • leverage ratio 1.2 (Q3 2017: 1.4) © Randstad 201
Slide 8: conclusion and outlook: driving for profitable growth
conclusion and outlook: driving for profitable growth. September and October trends Q3 conclusion and outlook in line with Q3 NAM NL FR • EBITA margin up, strong FCF conversion GER BEL • digital strategy well underway IBE IT • confirming FY 2018 EBITA margin outlook RoE low single-digit growth RoW m
Slide 9: capital allocation strategy
capital allocation strategy. capital allocation strategy maintain cash dividend policy with payout 40 – 50%; implement floor cash dividend of € 1.62 per share when leverage ratio < 1.0 => optional additional cash returns to shareholders special cash dividend share buybacks © Randstad 2018 | 9
Slide 10: digital strategy in full swing
digital strategy in full swing. © Randstad 2018 | 10
Slide 11: tech is easy, change is hard
tech is easy, change is hard. drive strengthen learn business digital how to results foundation change © Randstad 2018 | 11
Slide 12: the workforce scheduling journey
the workforce scheduling journey. 10/2016 03/2017 today local initiatives start Youplan France start Workforce phase 1 countries (9) up & running success in NL & BE blueprint in place Scheduling ● 600 portals opened kick-off global roll-out ● 600 in pipeline (1,000 impl. ambition 2018) Youplan & WFS
Slide 13: today's facts of workforce scheduling
today's facts of workforce scheduling. ● 1 country in Oct 2016 → 9 countries now # of implementations > 600 October YTD ● ready to scale: 50 new implementations p. week ● ambition FY 2018: 1,000 implementations decrease in turnover ● better communication with clients and workers 20% of temp workers
Slide 14: US WFS sites outperform non-WFS sites
US WFS sites outperform non-WFS sites. ~20% presence September YTD of total client onsites US inhouse: KPI’s WFS vs. Non WFS revenue growth pwd YoY weekly avg. pool churn weekly avg. GP/FTE growth +3% -/- 1% +3% GP growth pwd YoY monthly avg. fill rate hours growth +5% +5% +4% © Randstad 2018 | 14
Slide 15: Signal - data-driven sales
Signal - data-driven sales. ● enables consultants to find existing and prospect clients via web and mobile, ranked by ‘buying signals’ ● consultants plan & track visits via built-in scheduling and route mapping ● enables better sales and increases productivity via faster onboarding, better data and
Slide 16: talent engagement: our main initiatives
talent engagement: our main initiatives. vida Video interviewing and digital assessment tool that enables our talents to engage with us when and how they prefer. Implementing in 21 countries. dialogues Livechat direct interaction with candidates and clients to increase conversions and connection wit
Slide 17: our global IT strategy combines local strengths with global scale and synergies
our global IT strategy combines local strengths with global scale and synergies. channels (web, mobile, phone, chat, email etc) key IT principles: ● global policies, standards and mid & front-office (CRM, ATS, timesheets contracts defined etc) ● each country responsible for back-office IT (payroll,
Slide 18: total workforce integrated vision: talent delivery model
total workforce integrated vision: talent delivery model. workforce planning service request decision: • short vs. long-term need? • skill or knowledge gap? talent advisor client client recruiter • strategic or tactical need? toolkit service delegation talent advisor permanent service delegation con
Slide 19: tech as a differentiator: higher barriers to entry
tech as a differentiator: higher barriers to entry, favoring big players in a fragmented market where scale and proximity matter. Contingent Workforce tech touch tech touch self-service platforms integrated talent management tech touch tech touch Perm digital platforms talent engagement SME Clients
Slide 20: questions & answers
questions & answers. © Randstad 2018 | 20
Slide 21: randstad human forward
randstad human forward. VW