Michael Page sees slowdown continue as economy remains tough

Recruitment firm Michael Page said it expected pretax profit of around £85 million, towards the lower end of expectations, as activity slowed in the fourth-quarter amid tough economic conditions.

Michael Page, which places people in financial, accounting and legal services jobs, today said full-year gross profit rose 25% to £553.7 million.

Gross profit in the last three months of the year rose 13.4% to £135.9 million, the company said, falling behind the growth levels of 30 and 22% it reported in its second and third quarters.

"The uncertainty caused by the concerns surrounding the Eurozone and the lowering of worldwide GDP forecasts during the fourth quarter impacted significantly on our clients' recruitment plans, with many hiring decisions being deferred or cancelled," chief executive Steve Ingham said in a statement.

Last month it warned that full-year pretax profit would be towards the bottom end of forecasts as the global economic slowdown hits demand for its services. Analysts on average expect a group pretax profit of £87.57 million from a range of £80 million to £114 million, according to Thomson Reuters.

With the economic outlook for 2012 showing little better and job and budgetary pressures continuing to impact, rival recruiters Hays and Robert Walters have both also recently sounded caution for the year ahead.

Shares in Michael Page closed at 345.2 pence yesterday, down 36% on a year ago, valuing the business at around £1 billion.