Professional services recruiter Robert Walters (RWA:AIM) says permanent placements in the UK dipped in the second quarter but ‘didn’t fall of a cliff’ ahead of Britain’s vote to leave the EU.
Speaking alongside a second quarter trading update, finance officer Alan Bannatyne said the 7% net fee income (NFI) growth delivered by the group in the UK was driven by performance in its Recruitment Process Outsource (RPO) division rather than commissions from permanent placements.
‘There was a slowdown in permanent and that’s consistent with what we saw in the run-up to the General Election in May last year,’ said Bannatyne.
‘The Brexit vote was in June and we did not see the surge in that month which we did in the prior year after the election.’
As well as growth in RPO, chief executive and founder Robert Walters said the UK business, which makes up 31% of NFI, saw gains in cyber security and legal recruitment.
Walters added he does not expect to see the business impacted by changes in trade arrangements between the UK and EU following Britain’s vote to leave the customs union.
‘We do not trade goods across borders so the tariff debate does not apply to us,’ says Walters.
‘What we did do immediately after the result was to get in touch with our clients which are exporters because they will have a very nice time as a result of the weaker currency.
‘Industries which trade UK to UK will probably not be impacted too much, for those that export it will be positive and those that are importers it’s a negative.
‘There are always opportunities in change.
‘We have been around during the dotcom bubble in 2001 and Lehman in 2008, so we are seasoned veterans of these crises and the change they bring and there are always opportunities within them.’
Bannatyne added: ‘We are never geared up, we have a strong balance sheet and that means we can take a long-term view where we see opportunity.’
NFI in the more than two-thirds of the business not exposed to the UK grew significantly, up 10% at constant currencies and 17% because of depreciation in sterling, Walters' reporting currency.
Asia Pacific NFI gained 7% at constant currencies with Japan, Walters' largest market in the region, delivering its strongest ever result.
Europe surged 26% at constant currencies because of strong growth in Walters’ Spanish and Dutch business.
Around 70% of Walters’ business is in permanent recruitment and 30% is in its temporary and RPO business.
Shares in Walters trade 3.9% higher at 265p.