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Research Tree provides access to ongoing research coverage, media content and regulatory news on RANDSTAD HOLDING NV. We currently have 9 research reports from 1 professional analysts.
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RANDSTAD HOLDING NV
RANDSTAD HOLDING NV
No deceleration currently
26 Oct 16
In Q3 16, Randstad Holding benefited from strong organic revenue growth (+4.2% following +3.1% in Q2 16) and showed a slight improvement in the underlying EBITA margin (+0.1pt to 5.1% of revenue). Q3 16: Revenue reached €5,349m (+7.5%). Overall growth included a negative currency effect (-0.7%) and a positive change in perimeter (+4.5%). Organic revenue/working day was +4.2% (vs +5.4% in Q3 15). Gross profit increased to €999.8m (+7.1%, +3.3% organically) and the gross margin contracted very slightly to 18.7% of revenue (-0.1pt) due to the temp margin (-0.1pt) as a result of mix and price. EBITA (before the amortisation of acquisition-related intangible assets) increased to €260m (+7.6%) after integration costs of €-1.8m (vs none in Q3 15) and one-offs of €-9.1m (vs €-7.7m in Q3 15). Before these items, the underlying EBITA margin reached €270m (+8.7%, +5% organically) which corresponded to a margin rate of 5.1% of revenue (+0.1pt). The operating profit was €243m (+12.8%) after lower amortisation of intangible assets (€16.3m vs €25.5m in Q3 15). Some prior acquisition-related intangible assets were fully amortised during this quarter. Net income was €177m (+15.6%) after lower net financial costs (€-4.4m vs €-5.8m in Q3 15). 9 months 2016: Revenue reached €15,159m (+6.6%), gross profit was €2,828m (+6.7%) representing 18.7% of revenue, operating profit increased to €593m (+19%), and net profit was €436m (+27%). On 30 September 2016, net debt increased to €561m (vs €453m on 30 September 2015) and the net debt/EBITDA ratio of 0.6x (vs 0.5x on 30 September 2015) remained largely below the group’s target (max. 2.0x) and covenants (3.5x).
Agreement to "swallow" Monster
10 Aug 16
Randstad Holding has announced an agreement to acquire all outstanding shares of Monster at $3.40/share in cash. Based on the purchase price, the enterprise value of Monster is approximately $429m and the EV/LTM adjusted EBITDA multiple is relatively high at 10.3x (8.9x excluding the stock-based compensation). The price paid includes a premium of 22.7% to the closing share price on 8 August 2016 and 30.1% to the 90-day volume weighted average stock price. The board of directors of Monster recommend that shareholders accept the tender offer launched by Randstad Holding. The completion of the operation due to be in Q4 16 does not have any financing condition and is subject to the regulatory approvals. Randstad Holding, which had net debt of €634m at the end of June 2016, will use its existing credit facilities to fund the transaction. When the acquisition is finalised, Monster should continue its activities as a separate and independent entity under its brand name. Monster Worldwide 2015 key figures were as follows: - Revenue of $667m (-8%, -3.7% on constant currency), o/w 71% in North America and 29% in Europe and Asia. Revenue was down 5.4% in the Careers-North America segment and dropped by 14% (-0.9% on constant currency) in the Careers-International segment. - “Adjusted” EBITDA of $107m (+25%) corresponding to 16% of revenue (+4.2pts). - Operating income of $9.1m after restructuring costs of $33m (vs an operating loss of $-336m after a goodwill impairment of $-326m in 2014). The restructuring measures include the reduction of the workforce of 300 associates, lease exit costs, some asset impairments and the decrease in office and general expenses. The annualised cost savings are estimated to be $40m. - Total net profit of $78m, o/w $13m from the continued operations and $64.5m from the discontinued operations (50% of the capital of JobKorea sold for $85m). - Financial gross debt of $199m and cash & cash equivalents of $168m at year-end 2015.
Organic revenue growth slowdown
26 Jul 16
Randstad Holding had good figures in Q2 16 which included a slowdown in organic revenue growth (+3.1% after +5% in Q1 16) and a further improvement in the EBITA margin. Q2 16 earnings - Revenue reached €5,108m (+6%). Overall growth included a negative currency effect (-1.7%) and the acquisition of Proffice contributed positively (+2.4%). Organic revenue/working day was +3.1% (vs +6.7% in Q2 15). - Gross profit increased to €963m (+7%, +2% organically) and the gross margin improved slightly to 18.9% of revenue (+0.2pt) thanks to the impact of the temp margin and permanent placements (respectively +0.1pt and +0.2pt) which more than offset the negative effect of the decrease in the Dutch government payrolling activity. - Operating expenses increased to €724m (+5%, +3% organically). - Underlying EBITA was €240m (+11%, +10% organically) corresponding to a margin rate of 4.7% of revenue (+0.2pt). EBITA (before amortisation of acquisition-related intangible assets) increased to €235m (+11%) after integration costs/one-offs of €-4.3m (vs €-2.2m in Q2 15). - Operating profit was €214m (+20%) after lower amortisation of intangible assets to €-21m (vs €-34m in Q2 15). - Net income was €156m (+20%) after net financial costs of €-5m (vs €-4m in Q2 15) and a rather similar income tax rate (25.3%). H1 16 key data - Randstad Holding posted revenue of €9,810m (+6% and +4% organically). - The gross margin was rather stable at 18.6% reflecting an increase in North America, a positive impact of permanent placements and a negative price/mix effect in Europe and the Rest of World which affected the temp gross margin. - Underlying EBITA reached €409m (+11%) and reported EBITA was €401m (+12%) after lower integration/one-offs costs (€-7.5m vs €-11.4m in Q2 15). - Operating profit surged to €349m (+24%) after lower amortisation of intangible assets (€-52m vs €-74m in Q2 15). - Net income was €259m (+36%) after net financial result of €+0.3m (vs €-26m in Q2 15) and a stable income tax rate at 26%. The group had a slightly positive operating cash flow of €3.5m (vs €19m in H1 14), net capex of €27m (similar to last year). The purchase of own shares represented €24m and the dividend on ordinary and preference shares paid amounted to €94m. The group had strong operating cash flow at €88m (vs €3.5m in H1 15) thanks to higher EBITDA and lower WCR (improvement of the DSO from 51.2 days to 50.7 days). FCF was positive at €53m (vs €-23m in Q2 15) after net capex of €35m (+31%). Out-flows included the acquisition of Proffice and twago for €181m, the purchase of own shares for €14m and the dividend on ordinary and preference shares paid for a total of €320m. On 30 June 2016, net debt amounted to €634m (vs €575m on 30 June 2015 and €173m on 31 December 2015) and the net debt/EBITDA ratio was 0.7x (vs 0.7x on 30 June 2015 and 0.2x on 31 December 2015). The syndicated credit facility allows a leverage ratio of up to 3.5x while Randstad Holding’s internal goal is a maximum of 2x. The ROIC improved to 17.9% (vs 15.1% in H1 15) reflecting the increase in underlying EBITA and tight management of WCR.
Strategic move in IT services and outsourced R&D
22 Jun 16
On 20 June 2016, Randstad Holding announced a cash tender offer for all the shares in Ausy, a listed French company specialised in the management of information systems and infrastructure and in outsourced R&D. Randstad Holding is offering €55/share in cash, €63.25/ORNANE, €39.1/BSAAR (exercise period ended on 20 October 2016). The board of directors of Ausy unanimously supports the tender offer and Ausy shareholders representing 40.3% of the shares (44% of the voting rights) have committed to tendering their shares to the offer. The offer price includes a premium of respectively 27.6% and 20% vs the last closing share price and the average share price in the last six months prior to the announcement. The completion of the offer is subject to a minimum acceptance of 65% of the voting rights on a fully diluted basis. In addition, the offer is subject to regulatory approval.
Move in digital transformation
14 Jun 16
Randstad Holding is active in the digital transformation. The group announced the acquisition of twago, which is a European online platform for freelance workers. Created in 2009 in Berlin, twago now has more than 500,000 registered workers (mainly programmers and designers) for freelance work and provides services for a fee (Logo designs, PHP Expert per Hour for web development projects, Translation from English to Chinese, amongst others). In July 2014, twago received funds from Randstad Innovation Fund (RIF) to invest in the development of the platform.
In line with expectation
26 Apr 16
Randstad Holding delivered satisfactory organic revenue growth (in line with expectation) driven by all geographic areas except for Belgium (large account losses), a slight improvement in the underlying EBITA margin and ended Q1 16 with low net debt. Q1 16 revenue and earnings Revenue was €4,701m (+6%). The overall growth rate included a positive perimeter effect of 1.7% related to the integration of Proffice (contribution of €68m). Organic revenue per working day increased by 5% (vs +5.6% in Q1 15) considering the fairly similar number of working days to last year. The gross profit of €865m grew at the same pace as total revenue (+6%) and included a negative currency effect of €-2.5m. Organic growth (+4%) was lower than at the topline considering the impact of the loss of the government payroll business in the Netherlands. All in all, the gross margin remained stable at 18.4% of revenue. Operating expenses were under control (+5% to €696m, +3% organically) and included a positive currency impact of €5m. Underlying EBITA (before amortisation of acquisition-related intangible assets) reached €169m (+10%) corresponding to a slight increase in the margin rate (+0.1pt to 3.6% of revenue). Proffice contributed €1.7m. The reported EBITA increased by 15% to €166m due to lower one-offs (€-3.1m vs €-9.2m in Q1 15 which corresponded to restructuring costs in the Netherlands). The operating profit surged to €135m (+30%) after lower amortization of acquisition-related intangible assets (€30m vs €40m in Q1 15). Net profit was €102.5m (vs €59.5m in Q1 15) after net financial income of €5m which included a positive currency effect of €+5m (vs net financial expenses of €-22m which included a negative currency impact of €-20m in Q1 15). Low net debt The operating cash flow increased to €76m (+55%) after a decrease in the change of WCR (€28m vs €59m in Q1 15) reflecting an improvement of the DSO (50.8 days, -0.7)and despite higher income taxes paid (€54m, +50%). FCF reached €62m (+73%). The significant investment in shares (€176m) mainly related to the acquisition of Proffice. Randstad Holding ended Q1 16 with lower net debt yoy (€296m vs €425m on 31 March 2015 and €173m on 31 December 2015). The net debt/EBITDA ratio was 0.3x (vs 0.5x on 31 March 2015 and 0.2x at year-end 2015).
Panmure Morning Note 30-11-2016
30 Nov 16
RPC, the international plastics products design and engineering group, has delivered yet another strong set of results (1H17 EBITDA +65%, EPS +45%). At the interim stage PBT was +66% (materially better than we had forecast). Topline growth has principally being driven by acquisitions (GCS + BPI), though organic remains a feature (and crucially remains at levels consistent with FY16). The two recent acquisitions have quickly been assimilated into the panEuropean platform and management has raised cost synergy guidance (again).
N+1 Singer - Morning Song 30-11-2016
30 Nov 16
Sanderson has delivered full year results in line with expectations and the 19 October trading update after a strong finish to the year compensated for a slower start. A healthy level of pre-contracted recurring revenue (50%), incremental sales to existing customers and new customer wins at higher average order values helped deliver solid revenue growth in both the Digital Retail (+9%) and Enterprise (+12%) divisions. A decent order book and good sales momentum suggest that the company is on track to deliver on unchanged profit expectations for the current year. We continue to view the valuation (FY17 EV/EBITDA 8.6x) as undemanding given an attractive combination of accelerating growth potential, strong cash generation and growing dividends.
Panmure Morning Note 02-12-16
02 Dec 16
Today James Halstead will be holding its 101st AGM. Trading during the first part of FY17 has been mixed, with some notable challenges. However, movements in FX (i.e. weak sterling) is boosting reported earnings, offsetting UK volume trends and pricing pressures. Whilst earnings are likely to be second half weighted, the picture is in-line with expectations and we are leaving our FY17 PBT estimates unchanged (£47.4m in FY17 vs £45.4m FY16).
02 Dec 16
On 30 September 2016, when the company announced its full year results, it reported that the UK business had seen a slow start to the year, with particular weakness in repair and renewal spending by the NHS as well as “reticence” in the education sector. However, with the UK only representing about a third of the business, this weakness was expected to be more than offset by the positive effect of a weakened sterling on its overseas business, given the benefits for competitiveness and margins.
N+1 Singer - Morning Song 29-11-2016
29 Nov 16
Vp has reported another impressive set of interims, confirming strong growth in most markets and a positive outlook. Recent acquisitions are bedding in well and the full year outturn is set to exceed previous expectations (5%/6% EPS upgrades in FY17/FY18). The recent Capital Markets Day provided a reminder of Vp’s qualities (specialist focus, high returns, strong cash generation) and its growth potential, which in our view are not reflected in a modest <11x P/E rating. We firmly believe the shares are due a re-rating and see intrinsic value in excess of 800p.