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Steve Ingham
Kelvin Stagg
Chief Executive Officer
Chief Financial Officer
LSE: PAGE.L
Website: http://www.page.com/investors
7 March 2018
Full Year Results 2017
“A record year for the Group”
Investor Afternoon
15 May
Headline Numbers
Steve Ingham, Chief Executive Officer
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
4
Key financial highlights
A record year for the Group
£711.6m£621.0m FY 2016
+9.8%+3.0% FY 2016
Gross Profit
Constant
Currency
Growth
£118.3m£101.0m FY 2016
16.6%16.3% FY 2016
Operating
Profit
Conversion
Rate
£40.1m£20.1m FY 2016
25.23p18.44p FY 2016
Special
Dividend
Total
Dividends
£95.6m£92.8m FY 2016
Net Cash
Strategy Review
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
6
New Page Outsourcing Brand operating across our businesses
Global alignment of Brands
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
7
Delivering on our global diversification strategy
A growing international business
61%
39%
76%
24%
80%
20%
2007 2013 2017
Gross Profit
InternationalUK
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
8
Sustained investment has transformed the business
Large, High Potential Markets have driven growth
• All five markets experienced record years and double digit
growth in 2017
• Large, High Potential Markets gross profit CAGR 9.7%1
between 2013 and 2017
• Continue to focus on these markets in 2018 and beyond
1 Reported rates
154
223
100
140
180
220
2013 2017L
arg
e,
Hig
h P
ote
nti
al
Ma
rke
t G
ros
s P
rofi
t1(£
m)
+45%
0
150
300
450
600
Germany Greater China Latam South East Asia USA
Fe
e e
arn
er
he
ad
co
un
t
2013 2017
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
9
Key deliverables from the Page Vision in 2013
Operational efficiencies are being realised
Created network of
regional Shared
Service Centres
Driving economies
of scale, best
practice and
expertise
Global Systems;
GFS, PRS and
Nextgen website
Provide scale
and ability to
quickly innovate
Agile and
scalable
infrastructure
Flexible to react
to changes
in headcount
and demand
Harmonised
Systems
IT
Transition
Shared
Service Centres
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
10
A highly cash generative business model
Clear and established capital allocation strategy
£220m dividends
paid in
last 3 years
To satisfy
operational and
investment
requirements, and to
hedge liabilities
under the Group’s
share plans
To maintain the
ordinary dividend
through downturns
and to increase it
during more
prosperous times
To make a
supplementary
return to
shareholders either
by a share buyback
or special dividend
2nd use of cash 3rd use of cash1st use of cashReturns to
shareholders
Financial Review
Kelvin Stagg, Chief Financial Officer
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
12
Highest conversion rate since 2008
Strong top and bottom line growth
£711.6+9.8%1
Gross
Profit
(£m)
£118.3+11.3%1
16.6%+0.3ppts
Operating
Profit
(£m)
Conversion
Rate
(%)
1 Constant Currency
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
75%
25%
Perm Temp
83%
17%
Perm Temp
57%
43%
Perm Temp
13
Business balance reflects brands and geographic mix
Strong brand growth with consistent mix
• Gross Profit growth in
permanent +9.4% to £536.0m
• Temporary +11.1% to £175.6m
• Perm:Temp ratio 75:25 broadly
in line with prior year
• Gross Profit growth in
permanent +8.5% to £414.6m
• Temporary +6.6% to £82.3m
• Gross Profit growth in
permanent +12.8% to £121.4m
• Temporary +15.5% to £93.3m
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
• Employee costs driven by +9.5% increase in average
headcount and inflationary salary rises
• Increase in other costs mainly due to FX
• Fee earners added at a ratio of 85:15 to support staff
Fee earners to support staff ratio at new record 78:22
Costs driven by headcount and salaries
15
18
21
24
27
30
2008 2011 2014 2017S
up
po
rt s
taff
as
% o
f G
rou
p h
ea
dc
ou
nt
14
£m 2017 Constant %
Employee 454.4 +9.5%
Other costs 138.8 +9.8%
Total 593.2 +9.6%
Average headcount increase +9.5%
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Impact mainly in H1
Significant benefit from FX
Gross Profit (£m) Constant Currency Actual vs Constant Actual Rates
UK 140.8 - 140.8
EMEA 312.7 19.6 332.3
Asia Pacific 131.9 5.3 137.2
Americas 96.8 4.5 101.3
Group 682.2 29.4 711.6
Operating Profit 112.3 6.0 118.3
• Benefit to Gross Profit of £29.4m, Operating Profit of £6.0m
• 1% weakening of GBP would increase Gross Profit by c. £7m and Operating Profit by c. £1m
15
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Underlying tax rate broadly flat on prior year
Increase in tax charge due to US tax reform
2017 2016 %
Profit Before Tax 118.2 100.0 +18.2
Tax Charge 35.1 27.9 +25.7
Underlying +27.5% +27.4%
US Tax Reform and other +2.2% +0.5%
Effective Tax Rate 29.7% 27.9%
• US tax reform resulted in a write down of deferred assets
• 2018 Effective Tax Rate expected to be c. 27%
16
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Movements reflect effect of FX and increased trading activity
A strong and robust balance sheet
(£m) 2017 2016
Intangible assets 34.2 37.9
Tangible assets 30.2 29.5
64.4 67.4
Trade and other receivables 309.6 267.0
Trade, other payables, current and deferred taxes (199.5) (180.6)
110.1 86.4
Net cash 95.6 92.8
Net assets 270.1 246.6
17
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Total dividend £78.3m including £40m special dividend
Strong cash flow generation
Cash Increase Decrease
92.8 95.6
(40.1)
(0.1)
144.1
(19.6)
(39.8)
(16.2) 12.7
(38.2)
50
90
130
170
210
250
Dec 16 EBITDA Working Capital Tax and netinterest
Net capex Net optionexercises/EBT
purchases
Dividends Paid Exchange Dec 17
£m
18
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Committed to returning cash to shareholders
A growing dividend through the cycle
11.6 12.3
24.6 25.9
20.1
40.1
0
10
20
30
40
50
60
70
80
2016 2017£
m
Dividends Paid
Interim Final Special
• Final 2017 dividend proposed 8.6p
• Payable 18 June 2018
• Total dividend for year 25.23p
2017 Pence per Share
Interim 3.90
Final 8.60
Special 12.73
Total 25.23
19
+39%
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
20
Impacting every function of our business
GDPR is a big undertaking
Resource costs c. £1m
Team are also looking at the China Cyber Secuity law and ePrivacyRegulation
Appointed a Group Data Protection Officer
Changes to policies and procedures, websites, candidate systems, marketing platforms and supporting technologies
Multi country, multi function team dedicated to the programme
Regional Review
Steve Ingham, Chief Executive Officer
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
France33%
S. Europe21%
Germany15%
Benelux15%
Other16%
• France 16% of Group, strong growth +25%
• Germany also performed well +12%, strong growth in Page
Interim +19%
• Spain +16%, despite challenging conditions in Catalonia in H2
• Positive FX gross profit impact of c. £20m
Gross profit records in France, Germany and 8 other countries
EMEA saw strong market conditions
22
47% of Group
£m 2017 2016 Reported % Constant %
Gross Profit 332.3 271.9 +22.2% +15.0%
Operating Profit 69.7 51.7 +34.8% +26.2%
Conversion 21.0% 19.0% +2.0ppts
Headcount 2,996 2,553 +17.4%
Gross Profit
by Geography
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
London36%
North24%
South23%
Midlands17%
• Brexit continued to weigh on market sentiment
• Some multinationals and senior permanent candidates
most impacted
• But some disciplines showed growth: Property & Construction
+10%, Technology +7% and Engineering +6%
• Excluding share plan charges conversion would be
2ppts higher
Although pockets of growth in some disciplines
United Kingdom remained challenging
23
20% of Group
£m 2017 2016 Reported %
Gross Profit 140.8 146.3 -3.8%
Operating Profit 16.0 24.2 -33.8%
Conversion 11.4% 16.5% -5.1ppts
Headcount 1,407 1,411 -0.3%
Gross Profit
by Geography
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Greater China43%
Australasia27%
SE Asia & India18%
Japan12%
• Greater China, our third largest market and 8% of the Group,
strong growth +14%
• Investment in Japan delivered a record performance +23%
• South-East Asia, 3% of Group, had a record year +12%
despite headwinds in Singapore
• Australia +1%, opened new office in Canberra
Record years for Greater China, India, Japan and South East Asia
Asia Pacific performed well
24
19% of Group
£m 2017 2016 Reported % Constant %
Gross Profit 137.2 119.7 +14.6% +10.2%
Operating Profit 23.5 20.7 +13.5% +8.6%
Conversion 17.1% 17.3% -0.2ppts
Headcount 1,532 1,205 +27.1%
Gross Profit
by Geography
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
USA51%
Brazil14%
Mexico13%
Canada5%
Rest of Latam17%
• Diversification strategy in USA delivered good growth +21%
driven by Property & Construction and Marketing
• Brazil returned to growth +3% but expected to
remain challenging
• Latam (ex. Brazil), strong growth +20%, records in
all countries
A strong rebound and a record year
Americas returned to growth
25
14% of Group
£m 2017 2016 Reported % Constant %
Gross Profit 101.3 83.1 +21.9% +16.4%
Operating Profit 9.2 4.4 +108.6% +96.5%
Conversion 9.0% 5.3% +3.7ppts
Headcount 1,094 930 +17.6%
Gross Profit
by Geography
Summary
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
Continue to invest in Large, High Potential Markets
A record Gross Profit performance
Total dividends paid £78.3m and strong net cash position
Continue to invest in Large, High Potential Markets
Conversion rate increased to 16.6%
Continental Europe remains strong
Gross Profit +9.8% in constant currency
Record year for the Group
27
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
28
Investor Afternoon – 15 May 2018
Recap
on strategy
Venue
TBCPage Vision
How we can
leverage our
Conversion Rate
How we
use technology
Our views on RPO
Vision:To be the leading
specialist recruiter
in the markets
we operate
RPO
Appendix
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
30
Significant variations in recruitment mix
70% 70%
87% 85%
30% 30%
13% 15%
EMEA UK Asia Pacific Americas
Temp Perm
83%
57%
17%
43%
Michael Page Page Personnel
Geography Brands
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
1,174
1,657 1,657 1,466 1,444
1,708 2,075
2,763
3,837 3,654
2,515
3,273
3,797 3,624
3,810
4,278 4,484
4,711
5,497
-
1,000
2,000
3,000
4,000
5,000
6,000
1990-99 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Fe
e E
arn
er
He
ad
co
un
t
AMERICAS
ASIA
PACIFIC
EMEA
31
Notable fee earner and international growth
1985-1990 1990-19992000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Portugal
(2000)
Switzerland
(2001)
Belgium
(2001)
Sweden
(2001)
Poland S Africa
Ireland
UAE
Austria
Turkey
Luxembourg
Morocco
ThailandIndonesiaTaiwanIndia
Malaysia
New
Zealand
Japan
(2001)
China
(2003)
Australia
(1985)
USA (1988) Brazil (2000) Canada Mexico Chile Colombia Peru
INT
ER
NA
TIO
NA
L G
RO
WT
H
France
(1980)
Netherlands
(1987)
Germany
(1991)
Spain
(1997)
Italy
(1997)
Hong Kong
(1995)
Singapore
(1996)
2,347
1,238
1,009
903
Argentina
UKASIA
PACIFICEMEA AMERICAS
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
32
Fee earner investment and support staff discipline
0
1,000
2,000
3,000
4,000
5,000
6,000
H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2
He
ad
co
un
t
Fee Earner Support Staff
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
33
Year-on-Year Gross Profit Rates
2015 2016 2017
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
EMEA +12.1% +11.4% +13.0% +10.6% +10.3% +13.6% +10.4% +12.4% +14.8% +13.2% +12.6% +19.3%
UK +11.3% +12.8% +12.5% +2.4% +0.0% -2.3% -4.7% -6.7% -0.1% -4.5% -7.6% -2.8%
Asia Pacific +10.8% +5.6% +5.3% -1.3% -2.0% -3.3% -4.7% +1.7% +3.9% +6.8% +13.9% +14.9%
– Asia +14.1% +8.8% +9.2% +2.4% -1.5% -6.9% -7.9% -0.5% +3.6% +10.2% +21.9% +20.8%
– Australasia +3.9% -1.8% -2.3% -9.3% -3.0% +6.6% +3.9% +8.1% +4.7% -1.5% -4.4% +0.7%
Americas +7.1% +11.5% +5.3% +5.7% -0.6% -1.1% -2.0% +0.9% +15.2% +13.8% +18.4% +18.8%
– North America +10.6% +21.1% +18.0% +23.5% +9.2% -1.9% -10.8% -8.4% +12.5% +14.6% +26.5% +18.7%
– Latin America +4.2% +3.8% -4.8% -8.9% -9.8% -0.1% +9.6% +14.3% +19.2% +12.8% +9.1% +19.0%
Group Total +10.9% +10.6% +10.0% +5.5% +3.6% +3.7% +1.3% +3.8% +9.1% +7.7% +8.8% +13.8%
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
34
Contacts and Calendar
Contacts
Jeremy Tatham – Group Financial Controller
Tel: +44 (0) 1932 264 143
Email: [email protected]
Web: http://www.page.com/investors
Date Event
11 April 2018 Q1 2018 Trading Update
15 May 2018 Investor Afternoon
11 July 2018 Q2 2018 Trading Update
8 August 2018 HY 2018 Results
10 October 2018 Q3 2018 Trading Update
FY17
Headline Numbers Strategy Review Financial Review Regional Review Summary
35
Disclaimer
This presentation contains certain statements that are neither reported financial results nor other historical information.
The information contained in this presentation is not audited, is for personal use and informational purposes only and is
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accuracy, fairness or completeness of the information or opinions made in this presentation.
Certain statements included or incorporated by reference within this presentation may constitute “forward-looking
statements” that are based on current expectations or beliefs, as well as assumptions about future events. There are risk
factors that can cause actual results to differ materially from those expressed in or implied by such statements.
Accordingly, no assurance can be given that any particular expectation will be met and reliance should not be placed on
any forward-looking statement.
PageGroup plc disclaims any intention or obligation to revise or update any forward-looking statements that may be made
in this presentation, regardless of whether those statements are affected as a result of new information, future events or
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This presentation does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to
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recommendation regarding the shares of PageGroup plc. Past performance cannot be relied upon as a guide to future
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presentation shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws.