3rd quarter results
2021.
human forward.
contents
randstad reports record Q3 revenue,
up 21% YoY, further improving profitability. financial performance
4 core data
- invested capital
- cash flow summary
performance
9 performance by geography
other information
interim financial statements
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randstad reports record Q3 revenue, up 21% YoY, further improving profitability.
Q3 2021 organic growth
20.7%
Q3 2021 underlying EBITA
€ 298m
Q3 2021 EBITA margin
4.7%
group revenue 5% above Q3 2019, utilizing full strength of portfolio and investments. perm +74% YoY, +15% vs. 2019.
Q3 2021 gross margin of 19.9%, up 100bp YoY; perm 60bp and temp 20bp positive impact YoY.
Q3 2021 EBITA margin up 80bp YoY; L4Q ICR of 51%.
market-leading growth supported by diversified portfolio, continued outperformance in the US and France.
acquisition of Cella Inc. in the United States, a strong extension of our professional services offering.
September organic growth up 6% vs. 2019; volumes in early October indicate continued positive momentum.
"We continue to see strong momentum across our portfolio, with group revenues reaching record levels this quarter and surpassing Q3 2019 by 5%," says CEO Jacques van den Broek. "Our diversified portfolio and continued investment have enabled us to outperform in many geographies, with continued market outperformance in the US and France.
As our markets reopen I have enjoyed having more opportunities to meet with clients and talent in person to discuss the opportunities and challenges posed by the current labor market. It is clear that through our continued focus on people, underpinned by data and technology we are playing a key role in helping our clients manage their talent strategies and plan for the future. Recently we welcomed new employees through our acquisition of Cella Inc. in the United States. I would like to thank all our employees for their continued hard work and dedication which resulted in our strong performance.
Based on the strength of our performance in the first nine months of 2021, and September revenues being 6% higher than 2019, I am optimistic our continued positive momentum will persist for the remainder of the year, while still exercising caution as pandemic-related instabilities and limited visibility remain.
This morning, we also announced that I will step down as CEO and Chair of the Executive Board in March 2022. The Supervisory Board announced its intention to appoint Sander van 't Noordende as my successor and I look forward to working with him on the transition."
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financial performance.
core data
Q3 | Q3 | yoy | ||
in millions of €, unless otherwise indicated - underlying | 2021 | 2020 | change | % org. |
Revenue | 6,275 | 5,174 | 21% | 21% |
Gross profit | 1,251 | 980 | 28% | 28% |
Operating expenses | 953 | 781 | 22% | 22% |
EBITA, underlying1 | 298 | 199 | 50% | 50% |
Integration costs and one-offs | (15) | (26) | ||
EBITA | 283 | 173 | 64% | |
Amortization and impairment of intangible assets2 | (13) | (16) | ||
Operating profit | 270 | 157 | ||
Net finance costs | (1) | - | ||
Share of profit of associates | - | 1 | ||
Income before taxes | 269 | 158 | 70% | |
Taxes on income | (70) | (54) | ||
Net income | 199 | 104 | 91% | |
Adj. net income for holders of ordinary shares3 | 217 | 134 | 62% | |
Free cash flow | 297 | 494 | (40)% | |
Net debt | 234 | 391 | (40)% | |
Leverage ratio (net debt/12-month EBITDA)4 | 0.2 | 0.4 | ||
Leverage ratio (net debt/12-month EBITDA) excluding IFRS 165 | (0.3) | (0.3) | ||
DSO (Days Sales Outstanding), moving average | 51.6 | 53.0 | ||
Margins (in % of revenue) | ||||
Gross margin | 19.9% | 18.9% | ||
Operating expenses margin | 15.2% | 15.1% | ||
EBITA margin, underlying | 4.7% | 3.8% | ||
Share data | ||||
Basic earnings per ordinary share (in €) | 1.07 | 0.56 | 91% | |
Diluted earnings per ordinary share, underlying (in €)3 | 1.17 | 0.73 | 60% | |
- EBITA adjusted for integration costs and one-offs.
- Amortization and impairment of acquisition-related intangible assets and goodwill.
- Before amortization and impairment of acquisition-related intangible assets and goodwill, integration costs and one-offs. See table 'Earnings per share' on page 23.
- Leverage ratio including IFRS 16.
- Leverage ratio excluding IFRS 16, based on best estimates.
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revenue
Organic revenue per working day grew by 20.7% YoY in Q3 2021 resulting in revenue of € 6,275 million (Q2 2021: up 38.2%). Reported revenue was up 21.3% YoY, of which working days had no effect while FX had a positive effect of 0.6%.
In North America, revenue per working day was up 17% (Q2 2021: up 23%). Growth in the US was up 16% (Q2 2021: up
21%), while Canada was up 28% YoY (Q2 2021: up 50%). In Europe, revenue per working day grew by 21% (Q2 2021: up
46%). Revenue in France was up 12% (Q2 2021: up 63%), while the Netherlands was up 24% (Q2 2021: up 37%). Germany
was up 27% (Q2 2021: up 46%), while sales growth in Belgium was up 14% (Q2 2021: up 37%). Revenue in Italy was up
34% (Q2 2021: up 64%), while revenue in Iberia was up 22% (Q2 2021: up 45%). In the 'Rest of the world' region, revenue
was up by 21% (Q2 2021: up 20%); Japan increased by 10% (Q2 2021: up 5%), while Australia & New Zealand rose by 35%
(Q2 2021: up 33%).
Perm fees increased by 74% YoY (Q2 2021: up 91%), with Europe up 56% YoY (Q2 2021: up 103%) and North America up
95% YoY (Q2 2021: up 116%). In the 'Rest of the world' region, perm fees increased by 88% (Q2 2021: up 42%). Perm fees made up 11.3% of gross profit.
gross profit
In Q3 2021, gross profit amounted to € 1,251 million. Organic growth was 28.0% YoY (Q2 2021: up 44.9%). Currency effects had a positive € 3 million impact on gross profit compared to Q3 2020.
year-on-year gross margin development (%)
21%
20% | 0.2% | 19.9% | |
0.6% | |||
0.2%
19%18.9%
18%
17%
Q3 2020 | Temp | Perm placements | HRS/other | Q3 2021 |
Gross margin was 19.9% in the quarter, 100bp above Q3 2020 (as shown in the graph above). Temporary staffinghad a 20bp positive impact on gross margin (Q2 2021: 30bp positive impact), with underlying pricing climate stable. Permanent placements had a 60bp positive impact, while HRS/other had a 20bp positive impact.
operating expenses
On an organic basis, operating expenses increased by € 25 million sequentially to € 953 million. This includes selective investments in growth and digital initiatives. Compared to last year, operating expenses were up 22% organically (Q2 2021: up 24%), while currency effects had a € 4 million negative impact.
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Randstad Holding NV published this content on 21 October 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 October 2021 11:03:06 UTC.