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Vedior NV (0J9M)


Thursday 26 October, 2006

Vedior NV

3rd Quarter Results

Vedior NV
26 October 2006

                         Operating margin gains across
                             all regions in Q3 2006
                    For release at 7.00am on 26 October 2006

Highlights for Q3 2006
Amounts in € million                     Q3 2006       Q3 2005        Increase        Organic Growth (1)
Sales                                    2,013.4       1,807.5         +11%                 +7%
Gross Profit                               365.9         315.1         +16%                +10%
Operating Income (2)                        82.3          65.6         +25%                +16%
Net Income (2)                              47.8          39.5         +21%                  -
Net Income per share (€)(2)                 0.28          0.24         +17%                  -

(2) Excluding profit from the disposal of ISU, Germany in Q3 2006 of €4.7 
    million (€4.6 million net of tax)

•   Strong growth in operating income
    -   Netherlands up 43%
    -   Rest of Europe (excluding France and the UK) up 37%
    -   Rest of World (excluding US) up 20%
    -   France and US up 11%
•   Growth in the UK including Education sector
•   Operating margin up 46 basis points to 4.1%
•   Acquisitions in the UK and Australia

CEO's Statement

Zach Miles said, 'I am pleased that we have achieved a strong increase in
operating profit at the same time as we are investing in the business for
long-term growth.

We continue to focus on improving profitability which has resulted in gross
profit increasing faster than sales and an improved operating margin of 4.1%. In
this respect, we have made particularly good progress in France, the Netherlands
and Australia.

Our diverse business portfolio and strength in professional/executive
recruitment continues to provide investors with consistent and stable growth.'

Q3 2006 Review

(1)All growth percentages have been calculated on an organic basis which 
   excludes the impact of currency effects, acquisitions and disposals. Currency 
   effects decreased both sales and operating income by 1% this quarter.

Overall, sales increased by 7% this quarter and we achieved increases in all our
major markets.

Demand for permanent placement provided a 25% organic increase in placement
fees. Permanent placement now represents 3.1% (Q3 2005: 2.5%) of total Group
sales and 17% of gross profit (Q3 2004: 14%).

Gross profit was €365.9 million compared to €315.1 million in Q3 2005. The
development of permanent placement activities had a beneficial effect on the
Group's gross margin which increased from 17.4% in Q3 2005 to 18.2% this
quarter. Temporary gross margin increased by 16 basis points.

Operating expenses increased by 9% including costs for ongoing business
development initiatives.

In France, operating income improved by 11% with a 3% increase in sales. Gross
profit increased by 7%. Allowing for one less business day compared to the same
period in 2005, sales growth would have been 5%. We achieved consistent
operating margin improvements across all business segments apart from large
industrial sites. Accounting and finance was the best performing of our
professional/executive staffing niches in France but we also saw growth in IT,
engineering and healthcare. Growth in permanent placement services remains high
with particular emphasis on the professional/executive sectors.

In the UK, both operating income and sales showed positive gains helped by
better growth in the education sector. UK operating income was up by 5%, with
sales 2% higher than the same quarter in 2005. Gross profit increased by 6%.
Professional/executive recruitment achieved better growth in sales and
profitability this quarter.

In the US, gross profit and operating income both increased by 11% and sales by
13%. Growth in our business continued broadly in line with previous quarters
with skills shortages still prevalent. Despite positive sales increases, gross
margin did not keep pace with sales growth due to changes in business mix and
slower permanent placement growth in the accounting and finance sector. IT
recruitment developed well in terms of sales and profitability.

In the Netherlands, we gained leverage with an operating income increase of 43%
on an 8% increase in sales. Gross profit increased by 14%. Our two largest
brands in the Dutch market, Vedior and Dactylo showed the biggest improvement in
operating income. Strong demand for accounting and finance personnel has
continued in this quarter alongside good performances from interim management
and facilities management brands.

In the 'Rest of Europe' region, operating income increased by 37% while sales
and gross profit were up by 11%. Many of our European businesses contributed to
this result with the strongest growth in operating income experienced in
Switzerland, Spain, Germany, Portugal and Belgium.

In our 'Rest of World' region, operating income was up by 20% while sales and
gross profit increased by 21%. In Australia, operating income increased by 31%
and sales were up by 15% with good increases in profitability achieved in both
professional/executive and traditional sectors. In India, sales increased by 61%
and operating income by 70%. In Latin America, sales increased by 36% but our
gross profit grew at a lower rate because of wage inflation.

Cash flow from operating activities increased by €20 million to €70 million
compared to the same quarter in 2005 mainly due to higher operating income.

Net debt increased by €44 million compared to September 2005 to €603 million
primarily due to the cost of acquisitions.

Business Development

In the third quarter, new offices were opened in France, the UK and Australia.
With a presence in 45 countries, Vedior's global network has increased by 119
offices to 2,389 compared to 2,270 in Q3 2005 of which 21 were added by

In July, we acquired Coopers Recruitment, based in Tasmania, Australia which
specialises in permanent and temporary recruitment for professional, clerical
and administrative positions. Established in 1964, Coopers Recruitment was the
first recruitment service in Tasmania and has a very strong local brand

In October we acquired Armadillo UK Limited, a leading UK interim management
company.  With the addition of Armadillo to its portfolio, Vedior is now the
largest provider of interim management services in the UK.

For the year to date, we have completed nine acquisitions with annualised sales
of €300 million. Cumulative consideration paid for these acquisitions in the
year to date is €130 million.

Management Outlook

We expect current trends including improving operating margins will continue in
our major markets for the remainder of 2006.

For further information on these results, please join today's conference call at
9.00am (CET). Details can be found on our website at

Zach Miles, Chief Executive                             Tel: +31 (0)20 573 5609
Frits Vervoort, CFO
Jelle Miedema, Company Secretary

Investor Information at:

Company Profile

Vedior is one of the world's largest recruitment companies and is a full-service
recruitment provider with a diversified portfolio of brands targeting a broad
range of industry sectors.

From its global network of offices spanning Europe, North America, Australasia,
Asia, South America and Africa, Vedior offers temporary and permanent
recruitment as well as a number of complementary employment-related services
such as outplacement, HR outsourcing, payrolling and training.

Vedior has a leading market position in the provision of professional/executive
recruitment in sectors such as information technology, healthcare, accounting,
engineering and education. We also have a significant global network providing
administrative/secretarial and light industrial recruitment.

Financial Agenda

8 February 2007       Publication Q4 and annual 2006 results
27 April 2007         Publication of first quarter results and AGM
26 July 2007          Publication of second quarter results
25 October 2007       Publication of third quarter results

Safe Harbour

This media release includes forward-looking statements that reflect our
intentions, beliefs or current expectations and projections about our future
results of operations, financial condition, liquidity, performance, prospects,
growth, strategies, opportunities and the industry in which we operate.
Forward-looking statements include all matters that are not historical fact. We
have tried to identify these forward-looking statements by using words including
'may', 'will', 'should', 'expect', 'intend', 'estimate', 'project', 'believe',
'plan', 'seek', 'continue', 'appears' and similar expressions or their negative.

These forward-looking statements are subject to a number of risks,
uncertainties, assumptions and other factors that could cause our actual results
of operations, financial condition, liquidity, performance, prospects or
opportunities, as well as those of the markets we serve or intend to serve, to
differ materially from those expressed in, or suggested by these forward-looking
statements. Important factors that could cause those differences include, but
are not limited to our financial position and our ability to implement our
business strategy and plans and objectives of management for future operations,
our ability to develop, balance and expand our business, our ability to
implement our long- term growth strategy (including through organic growth and
acquisitions), our ability to make improvements to our capital structure,
industry and market trends and volumes, including the speed and strength at
which the staffing services industry and the sectors in which we operate,
rebound from economic slowdowns and recessions, the effects of regulation
(including employment and tax regulations), our ability to improve the
efficiency of our operations and to reduce expenses in our operating companies
and their network of offices, litigation and our ability to take advantage of
new technologies.

In light of these risks, uncertainties, assumptions and other factors, the
forward-looking events described in this media release might not occur.
Additional risks that we may deem immaterial or that are not presently known to
us could also cause the forward-looking events discussed in this media release
not to occur. Except as otherwise required by applicable law, we undertake no
obligations to update publicly or revise publicly any forward-looking
statements, whether as a result of new information, future events, changed
circumstances or any other reason after the date of this media release.

                      This information is provided by RNS
            The company news service from the London Stock Exchange                                                                                           

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