Business
Adecco recruits former Sodexo boss Machuel as new CEO
Global Banking & Finance Review®
Company
By John Revill
ZURICH (Reuters) -Adecco has recruited the former boss of French multinational food service company Sodexo as its next chief executive, the staffing company said on Thursday, as it announced first-quarter results which trailed rivals.
Denis Machuel will take charge on July 1 at Adecco, which competes with Randstad and Manpower in providing temporary and permanent staff to companies.
He will replace Alain Dehaze, who has reduced the Swiss company’s sensitivity to economic ups and downs by boosting its IT training and consultancy business.
Dehaze, who had led Adecco since 2015, had told the board he wanted to step aside “before the start of the next strategic cycle,” Chairman Jean-Christophe Deslarzes told reporters.
“The board believes now is the right time for CEO transition, building on the strong foundations that are now in place,” he said. “This decision is the culmination of a carefully planned succession process.”
The search for a new CEO had taken place over the last year before the board chose Machuel, who led Sodexo until October last year.
Dehaze’s realignment of Adecco also included the company’s – 2 billion euro ($2.12 billion) deal to buy AKKA Technologies last year, its largest-ever acquisition.
But his strategy did not turn around the slump in the company’s share price, as global hiring was hit by the COVID-19 pandemic.
During Dehaze’s tenure, Adecco shares fell 46% in value, underperforming the Swiss index which gained 42%. The downturn meant the Zurich-based company fell out of the blue-chip Swiss Market Index in July 2020.
During its first quarter Adecco posted revenues of 5.45 billion euros ($5.79 billion) up 10% from a year earlier, and ahead of analysts’ forecasts for 5.38 billion euros.
But removing the effect of currency movements, trading days and acquisitions, revenues increased 5%, trailing Randstad which reported a 15% jump and Manpower which had a 6% increase.
While its peers increased profit during the quarter, Adecco’s net income fell 26% to 92 million euros, weaker than forecasts. Its main operating profit margin declined to 3% from 4% a year earlier.
Deslarzes said the drop was because the Adecco had been investing, with the company taking on more workers in sales and digital areas.
Its shares were down 2% in early trading.
“Our company is about a sound balance between EBITA margin and revenue growth, that is what we are attacking now, we are investing in growth,” Deslarzes said.
($1 = 0.9422 euros)
(Reporting by John Revill; Editing by Clarence Fernandez, Subhranshu Sahu,Simon Cameron-Moore and Kim COghill)
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