Interim Management Statement

HAYS

INTERIM MANAGEMENT STATEMENT

FOR QUARTER ENDED 31 MARCH 2010

8 April 2010


Financial summary

Growth in net fees for the quarter ended 31 March 2010 (Q3)     growth   
(versus the same period last year)                                 
                                                            actual    LFL*
By region                                                           
  Asia Pacific                                                 23%      3%
  Continental Europe & Rest of World                          (2)%    (7)%
  United Kingdom & Ireland                                   (18)%   (18)%
  Total                                                       (5)%   (10)%
                                                                    
By segment                                                          
  Temporary                                                   (8)%   (12)%
  Permanent                                                   (1)%    (6)%               
  Total                                                       (5)%   (10)%
                                                                    
* LFL (like-for-like) growth represents organic growth at constant currency.
 

Highlights

·  2% sequential growth in Group net fees versus the previous quarter,
   led by 7% sequential net fee growth in Asia Pacific

·  Modest sequential net fee growth in Continental Europe & RoW with
   trading in Germany improving through the quarter

·  Continued stability in the UK with growth in the private sector
   offset by reduced demand in the public sector

·  International business now represents 57% of Group net fees

·  Consultant headcount up 2% with selective investment in Asia,
   Australia, Germany and Brazil

Commenting on trading for the quarter ended 31 March 2010, Alistair Cox, Chief
Executive of Hays plc, said:

"We have continued to see progress in most of our markets, although the
dynamics vary by region. In Asia Pacific, we have seen a third consecutive
quarter of improving trends in Australia and we are seeing a broad-based
recovery across the other Asian countries. In Continental Europe & Rest of
World, we are seeing strong growth in Brazil, the early signs of recovery in
Germany and broad stability across most other countries except Spain and the
UAE, which continued to weaken. In the UK, we are seeing sequential growth in
the private sector offset by reductions in the public sector.
 
Where markets are recovering, we are now increasing our capacity and
selectively recruiting to meet growing demand. Over the course of the recession
we have invested in our technology platforms, marketing and training programs
and these investments are well advanced and are now delivering results, just as
a number of our markets are showing encouraging trends. Equally, we have
maintained our strong cash flow performance and dividend throughout the
downturn and are positioned better than ever to capitalise on cyclical and
structural growth in each of our markets as they recover over time."


Group

In the quarter ended 31 March 2010, Hays, the leading global specialist
recruitment group, saw a decrease in net fees of 5% (10% on a like-for-like
basis*) versus the same period last year. Net fees from the temporary placement
business decreased by 12%* and net fees from the permanent placement business
decreased by 6%*. Net fees in our private sector business were down 8%*, with
net fees in our public sector business down 17%*, the public sector accounting
for 23% of total Group net fees in the quarter.

On a sequential basis, total Group net fees increased by 2% versus the previous
quarter, there was a modest quarter-on-quarter decline in the underlying
temporary placement margin** and headcount increased by 2% across the business,
with investment in parts of our international business partially offset by
selective reductions in the United Kingdom.
 

Asia Pacific

In Asia Pacific we recorded 7% sequential net fee growth versus the previous
quarter, being the third consecutive quarter of growth. We continue to take
advantage of improving market trends in our market leading Australia & New
Zealand business, as growth in demand in private sector business more than
offset the decrease in our public sector business. Our performance in Asia was
again strong with many countries now performing at pre-downturn levels.
Consultant headcount was increased by 10% during the quarter, with headcount up
25% in Asia, as we continue to invest to ensure we capitalise on the improving
market conditions we are seeing in all countries across the division.

 
Continental Europe & Rest of World ('RoW')

In Continental Europe & RoW we recorded 3% sequential net fee growth versus the
previous quarter. Our German business, which is primarily focused on the IT
contracting market, saw good levels of contractor re-engagement post-Christmas
and modest sequential growth through the quarter. In our Brazilian business we
continued to achieve strong growth as market conditions improved. Our
businesses in Spain and the UAE continued to weaken due to the uncertain
economic outlook in these markets, whilst the sequential net fee trends in the
remaining businesses, principally in permanent placement markets, remained
broadly flat this quarter. Consultant headcount increased by 4% during the
quarter, predominantly in Germany and Brazil.
 

United Kingdom & Ireland

In the United Kingdom & Ireland quarter-on-quarter net fees remained broadly
flat, with modest sequential growth in demand in the private sector business
offset by continuing weakness in the public sector, particularly in
administrative and other non-front line placements. Overall the public sector
declined 19% versus the same period last year. In addition, the unprecedented
adverse weather conditions at the start of the period resulted in a number of
lost temporary placement days. Consultant headcount was down 1% in the quarter,
principally in our public sector Construction & Property business.  
  

Cash flow and balance sheet

The Group continued to deliver a solid cash flow performance, although net debt
increased to c.£80m (December 2009: £38.4m) at the end of the period. This was
due to the normal phasing of cash outflows together with a modest increase in
working capital as trading improved through the quarter.
 

Investor day: 'Returning to growth'

We will be holding an Investor Day in London on 29 April 2010. Management will
be making a series of presentations focusing on the investments we are making
in the business, particularly in the areas of technology and marketing, plans
to strengthen our business in the UK and our strategy to deliver industry
leading growth in the International markets.
 

* LFL (like-for-like) growth represents organic growth at constant currency.

** the underlying temporary placement gross margin is calculated as temporary
placement net fees divided by temporary placement gross revenue and relates
solely to temporary placements in which Hays generates net fees and
specifically excludes transactions in which Hays acts as agent on behalf of
workers supplied by third party agencies.

 
Enquiries

Hays plc                                                                                
Paul Venables                      Finance Director         + 44 (0) 20 7383 2266          
Martin Abell/James Hilton          Investor Relations       + 44 (0) 20 7383 2266          
                                                                                        
Maitland                                                               
Neil Bennett                                                + 44 (0) 20 7379 5151          
Liz Morley                                                                              
 

Conference call

Paul Venables and Martin Abell of Hays plc will conduct a conference call for
analysts and investors at 9:00am United Kingdom time on Thursday 8 April 2010.
The dial-in details are as follows:

Dial-in number                                              [phone]                 
Password                                                    hays                                 
                                                                              
The call will be recorded and available for playback for seven days as follows:   
                                                                               
Replay dial-in number                                       [phone]                 
Access code                                                 264195#                              
                                                                               

Reporting calendar

Investor Day                                                       29 April 2010  
Trading Update for quarter ending 30 June 2010                     8 July 2010    
Preliminary results for the year ending 30 June 2010               2 September 2010    
Interim Management Statement for quarter ending 30 September 2010  7 October 2010 
 

Note to editors

Hays plc is the leading global specialist recruitment group. It is market
leader in the UK and Australia, and one of the market leaders in Continental
Europe. As at 31 December 2009, the Group employed 6,644 staff operating from
325 offices in 28 countries across 17 specialisms. For the year ended 30 June
2009:

-  the Group had revenues of £2.4 billion, net fees of £670.8 million and
   operating profit of £158.0 million;

-  the Group placed around 50,000 candidates into permanent jobs and around
   270,000 people into temporary assignments;

-  the temporary placement business represented 56% of net fees and the
   permanent placement business represented 44% of net fees;
 
-  Hays operates in the following countries: Australia, Austria, Belgium,
   Brazil, Canada, China, the Czech Republic, Denmark, France, Germany, Hong Kong,
   Hungary, India, Ireland, Italy, Japan, Luxembourg, the Netherlands, New
   Zealand, Poland, Portugal, Russia, Singapore, Spain, Sweden, Switzerland, UAE
   and the United Kingdom.
 

Cautionary statement

This Interim Management Statement has been prepared solely in compliance with
the Disclosure Rules and Transparency Rules of the UK Financial Services
Authority and is not audited. Statements in this Interim Management Statement
reflect the knowledge and information available at the time of its preparation.
Certain statements included or incorporated by reference within this Interim
Management Statement may constitute "forward-looking statements" in respect of
the Group's operations, performance, prospects and/or financial condition. By
their nature, forward looking statements involve a number of risks,
uncertainties and assumptions and actual results or events may differ
materially from those expressed or implied by those statements.  Accordingly,
no assurance can be given that any particular expectation will be met and
reliance should not be placed on any forward-looking statement.  Additionally,
forward-looking statements regarding past trends or activities should not be
taken as a representation that such trends or activities will continue in the
future. No responsibility or obligation is accepted to update or revise any
forward-looking statement resulting from new information, future events or
otherwise. Nothing in this Interim Management Statement should be construed as
a profit forecast. This Interim Management Statement does not constitute or
form part of any offer or invitation to sell, or any solicitation of any offer
to purchase any shares in the Company, nor shall it or any part of it or the
fact of its distribution form the basis of, or be relied on in connection with,
any contract or commitment or investment decisions relating thereto, nor does
it constitute a recommendation regarding the shares of the Company. Past
performance cannot be relied upon as a guide to future performance. Liability
arising from anything in this Interim Management Statement shall be governed by
English Law. Nothing in this Interim Management Statement shall exclude any 
liability under applicable laws that cannot be excluded in accordance with such 
laws.