Recruiter PageGroup PLC on Monday reported a sharp jump in half-year profit, on the back of wage inflation and labour market staff shortages.

For the six months to June 30, pretax profit jumped 80% to £114.5 million from £63.7 million last year. Revenue climbed 28% to £977.3 million from £766.4 million.

The Weybridge, Surrey-based recruiter recorded a double-digit profit rise from all regions, with EMEA remaining the largest, contributing 50% of group gross profit. Compared to the same period in 2021, gross profit in the region climbed 31% to £266.7 million from £203.5 million, through an improvement in trading conditions.

Meanwhile, the Americas saw the fastest rate of growth, with gross profit increasing by 54% to £94.2 million from £61.3 million.

PageGroup explained that it continues to benefit from favourable trading conditions, including wage inflation and increased fee rates, resulting from the high demand and short supply of candidates. Further, it said that the hiring process is shorter than pre-pandemic, with video interviewing cutting recruitment time.

However, the company also reported a 25% increase in administrative expenses to £423.6 million, compared to £339.9 million the year before. It explained that this was largely driven by the increase in headcount. During the period total headcount increased by 830 to 8,668 at the end of June.

‘The largest headcount investments were made in the markets where we saw the strongest growth and with the highest growth potential, including Germany, the US and India. This investment has driven record performances in four of our five large, high-potential markets and both of our high-potential disciplines,’ said Chief Executive Officer Steve Ingram.

PageGroup declared an interim dividend of 4.91p, up 4.5% from 4.70p paid last year. In addition, the headhunter announced a special dividend of 26.71p, unchanged from last year. Taking these two dividend payments together, this amounts to a cash return to shareholders of £100.5 million, it noted.

Looking ahead, PageGroup said that outlook is unchanged, expecting full year operating profit to be in line with company-compiled consensus of £206 million, up from £168.5 million in 2021.

CEO Ingham said: ‘Looking forward, we recognise the heightened degree of global macro-economic and geo-political uncertainty, particularly with regards to increasing inflation around the world.

‘In July, we noted a slight slowing in time to hire in some of our markets, and we continue to closely monitor our forward-looking key performance indicators,’ Ingham added.

PageGroup shares were down 7.8% to 416.40 pence each in London early Monday.

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