Adecco Reports Higher Profit but Weaker Revenue in Q4

Adecco Group reveals a growth in net income despite a drop in revenue. Key earnings metrics show mixed results, indicating potential challenges ahead.

Date: 26-02-2025

AI Rating: 5

Earnings Per Share (EPS)
In the fourth quarter, Adecco reported earnings per share of 0.43 euros, which is a 7 percent increase from the previous year's 0.40 euros. This indicates a positive trend in EPS despite other challenges reported.

Net Income
The company's net income attributable to shareholders grew by 6 percent, reaching 73 million euros, compared to 68 million euros last year. This is a positive sign for investors as it shows profitability growth.

Revenue Growth
However, revenues fell by 4 percent to 5.87 billion euros from 6.11 billion euros last year. This decline in revenue may raise concerns regarding future performance and market position. The organic revenue decline of 5 percent is particularly notable.

Adjusted EBITA and Profit Margins
The adjusted EBITA experienced a significant drop of 29 percent, falling to 187 million euros from 264 million euros in the previous year. The adjusted EBITA margin also decreased by 110 basis points to 3.2 percent, highlighting a decrease in operating efficiency and profitability during this period.

Overall Outlook
Despite the mixed results, Adecco's forecast for an increase in gross margin in the first quarter aligns with normal seasonality, which could bolster investor confidence going forward. However, the cuts in expected adjusted earnings per share (from 0.75 euros to 0.63 euros) might still concern some shareholders regarding future earnings potential.

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