Robert Walters (RWA) H2 2024 earnings summary

Executive summary

• 2024 marked a second consecutive year of challenging global hiring markets, with subdued client and candidate confidence impacting specialist recruitment and recruitment outsourcing.

• Strategic repositioning and cost discipline were implemented, with early progress on margin improvement.

• Over £4 million in structural cost savings achieved, with further margin improvement initiatives underway.

• High conviction remains in long-term growth drivers, especially in Japan and service line diversification.

Financial highlights

• Net fee income declined 17% year-on-year to £321.4 million due to weak hiring markets.

• Operating profit was £5.2 million, with profit before tax at £0.5 million and a basic EPS loss of (9.1)p.

• Operating costs were reduced by £44.3 million, driven by a 15% headcount reduction and lower variable compensation.

• Net cash at year-end was £52.5 million; total dividend proposed at 23.5p per share, in line with prior year.

• Negative free cash flow of £8 million, with CapEx down by a third year-on-year.

Outlook and guidance

• Improvement in end markets is not expected before the latter part of 2025, with a slight second-half weighting to fee income anticipated.

• Cost base will remain tightly managed, with continued selectivity in fee earner replacement.

• Net cash expected to dip at half-year due to dividend and bonus payments, but working capital impact should be more balanced.

• Muted trading in early 2025, consistent with seasonal patterns.