Investment case

Our business philosophy centres on the need to invest to support long-term growth, but also to generate profits and cash along the way.

In practical terms, this means we continually focus on: consultant and business productivity; profitability; strategic reinvestment of our profits to support growth; cash generation and returns to shareholders.

In addition, we believe there are four simple and compelling reasons to invest in Hays.

The Breadth of Our Business Model Across Sector and Contract Type

  • We have built a global platform with unrivalled scale, balance and diversity.
  • We have exposure across permanent, temporary and contractor recruitment markets at a scale, which is unique amongst our peers.
  • We focus on execution in each of our local markets delivered by the best people, sector-leading technology, tools and a world-class single brand.
  • We have strong and experienced operational and senior regional management teams across the Group.
  • We focus on developing and delivering the best services and products for clients and candidates, meeting their evolving needs.



A Balanced Exposure to Both Mature and Structural Growth Markets

  • Many of the 33 countries across our global platform represent clear structural growth opportunities, where the use of agencies such as Hays to source skilled employees is a relatively new practice.
  • 39% of our Group net fees are generated in these structural growth markets which include Germany, Latin America and Japan.
  • The remaining 61% of net fees come from more mature markets, such as the UK, the US or Australia, where the use of agencies is a long-established practice in the skilled jobs market.

Group net fees
1. Mature markets 61%
2. Structural growth markets 39%

Our Ability to Deliver Superior Financial Performance Through the Cycle

  • Three years into our five-year plan, we are where we expected to be in terms of our aspiration to broadly double 2013’s operating profit of £125 million to £250 million in 2018.
  • We have a balanced exposure across countries, specialist areas and contract forms (between temp, contracting and perm).
  • We believe this balance adds relative resilience to our earnings throughout the economic cycle and drives the outperformance of our business versus the peer group.
  • Despite this existing balance we remain focused on further diversifying our earnings, building scale across our existing global platform.

FY16 operating profit£181.0m

Earnings per share8.48p

Our Potential to Generate Significant Cash Flow and Dividends

  • Delivering our plan would allow us to generate material cash returns, increase our net cash position and grow the Group’s dividend.
  • We target core dividend cover of 3.0x earnings and are building cover towards this level, with this year’s at 2.9x.
  • It is our intention that once we have built a net cash position of c.£50 million, any free cash generated over and above this level will be distributed to shareholders annually, at year end, assuming a positive outlook, most likely as a special dividend, supplementing the core dividend.
  • This year we achieved our long-standing ambition of eliminating net debt, a significant milestone for the Group.

Net cash£36.8m

Dividend per share2.90p