Companies: MPI   

An ongoing diversification drive enabled recruiter Michael Page, which recently rebuffed an approach at 400p from Swiss rival Adecco, to achieve a 22% increase in profit before tax to £84.1m for the half to June.

Chief executive Steve Ingham says the group's previous dependence on permanent staffing in the finance and accounting sector has diminished, with more than 20% of gross profit now generated from temporary placements and 50% from non-finance disciplines. ‘It is clear that the composition of the group is significantly more diverse and robust than when market conditions were difficult in the early 1990s and 2000s', he commented. Global expansion into new markets is another factor fuelling resilient growth, with 67% of gross profits now emanating from outside the UK.

A 28.3% rise in first half earnings per share to 18.3p, as well as a reassuring £22.3m of net cash in the coffers, meant the board was able to propose a 20% increase in the interim dividend to 2.88p per share.

Undeterred by current economic uncertainties, management remains confident that the underlying growth trends will continue to benefit the business – these include social and demographic change, increasing deregulation of labour markets as well as the increasing job and geographic mobility of candidates.

Shares in Michael Page, buoyed by recent bid interest, have emerged from a recent low of 221.25p and are currently trading on only 9.9 times broker Collins Stewart’s 33.5p full year earnings forecast. That looks an ungenerous rating given growth rates, the group's expansion into new areas, the cash on the balance sheet and the potential for a renewed bid. Sit tight.

Save 50% off your first year’s subscription to Growth Company Investor magazine, and gain immediate access to all the recommendations online. Click here.

Michael Page International	LSE	£647.68m	203.25p	-11.50p
Click here for interactive charting
Other company articles:
Michael Page International			19/08/2008
Bridgewell Securities ‘Book profits at Michael Page, buy Spice Holdings’			14/03/2006
Teather & Greenwood ‘London market showing remarkable strength’			07/02/2006
Outplacement market in the mire			06/12/2005
Support Service Stars – by James Crux			02/08/2004