UK's PageGroup to slash costs by $19 million, withholds outlook amid tariffs

By Shashwat Awasthi

(Reuters) -British recruiter PageGroup said it would cut costs by 15 million pounds ($19.3 million) after its first-quarter earnings fell 9%, and did not issue a financial forecast amid "increasingly unpredictable" conditions due to U.S. tariffs.

"Given the recent introduction of tariffs and the resultant market uncertainty, we are not providing forward-looking guidance on business performance," CEO Nicholas Kirk said in a trading statement.

Shares of the company, which helps recruit people for jobs across sectors such as finance, technology, healthcare, and engineering, fell 4.3% to 246 pence in early trading on Wednesday.

The Trump administration's tariffs have jolted global markets and compounded the problems faced by recruiters, who were already struggling with deteriorating conditions in European centres such as France and Germany.

The FTSE 250 firm's gross profit fell to 194.2 million pounds for the three months ended March 31, compared with 220 million pounds a year earlier.

Jefferies analysts said the 9% earnings drop was slightly better than its estimate of 10.5%, but noted that underlying trends were not improving and challenging conditions persisted.

PageGroup's earnings in France slumped 17% in the first quarter due to political and economic turmoil. Profit in Germany declined 12%, albeit better than the 23% drop in the prior quarter, as elections and a bumper government spending plan eased some nerves.

France and Germany together make up more than a quarter of PageGroup's earnings.

"The conversion of interviews to accepted offers remained the most significant challenge, as ongoing macroeconomic uncertainty continued to impact confidence, which extended time-to-hire," Kirk said.

U.S. earnings rose 7% - marking a second straight quarter of growth - helped by hiring in engineering and manufacturing, PageGroup said.  

The company said it had cut 74 fee-earning consultants and 59 "non-operations" employees during the quarter, and was simplifying its management structure to save money. 

($1 = 0.7787 pounds)

(Reporting by Shashwat Awasthi in Bengaluru; Editing by Janane Venkatraman, Louise Heavens and Kate Mayberry)