Adecco Group –
Operating and financial review and prospects
in millions, except share and per share information

1. Operational results

1.2 Segment performance

The segment breakdown of revenues and operating income for the six months ended June 30, 2011 and June 30, 2010 is presented in the following table:

Download xls sheet

 

 

 

Variance %

in EUR

2011

2010

EUR

Constant
currency

 

 

 

 

 

Revenues [1]

 

 

 

 

France

3,004

2,531

19

19

North America [2]

1,826

1,594

15

19

UK & Ireland [2]

817

772

6

5

Japan

682

619

10

3

Germany & Austria [2]

738

549

35

35

Benelux [2]

469

409

15

15

Italy

520

381

36

36

Nordics

400

334

20

14

Iberia

367

338

8

8

Australia & New Zealand

245

195

26

13

Switzerland

221

162

36

20

Emerging Markets

683

587

16

17

LHH

109

137

(20)

(19)

Adecco Group [2]

10,081

8,608

17

17

 

 

 

 

 

Operating income [1]

 

 

 

 

France

94

76

23

23

North America

75

54

39

48

UK & Ireland

15

7

108

106

Japan

40

34

19

11

Germany & Austria

48

26

87

87

Benelux

20

11

77

77

Italy

34

16

106

106

Nordics

6

15

(58)

(60)

Iberia

11

10

4

4

Australia & New Zealand

7

4

72

58

Switzerland

20

13

57

38

Emerging Markets

19

16

21

23

LHH

21

36

(41)

(40)

Corporate Expenses

(39)

(37)

 

 

Operating income before amortisation of intangible assets

371

281

32

34

 

 

 

 

 

Amortisation of intangible assets

(27)

(27)

 

 

 

 

 

 

 

Adecco Group

344

254

35

37

[1]Since January 1, 2011, LHH is reported as a separate segment. The 2010 information has been restated to conform to the current year presentation.

[2]In the first six months of 2011, revenues changed organically in North America by 14%; UK & Ireland by 2%; Germany & Austria by 34%; Benelux by 14%; and Adecco Group by 15%.


France

In the first six months of 2011, revenues in France increased by 19% and operating income amounted to EUR 94 compared to EUR 76 in the first six months of 2010. The operating income margin was 3.1% in the first six months of 2011. The French payroll tax subsidy cut had a negative impact on the operating income margin in France of 55 bps.

North America

In North America, revenues increased by 15%, or by 14% organically, compared to the first six months of 2010. Operating income in the first six months of 2011 was EUR 75, an increase of 48% in constant currency. Furthermore, in the first six months of 2011, the operating income margin increased by 70 bps to 4.1%.

UK & Ireland

In the first six months of 2011, revenues in the UK & Ireland increased by 6% or by 2% organically. In the first six months of 2011, the UK & Ireland operating income amounted to EUR 15 compared to EUR 7 in the first six months of 2010.

Japan

In Japan, revenues increased by 10% or by 3% in constant currency, compared to the first six months of 2010. Operating income was EUR 40 compared to EUR 34 in the first six months of 2010 and the operating income margin increased from 5.5% in the first six months of 2010 to 5.9% in the first six months of 2011.

Germany & Austria

In Germany & Austria, revenues increased by 35% compared to the first six months of 2010. Operating income amounted to EUR 48 compared to EUR 26 in the same period of 2010. The operating income margin was 6.5% in the first six months of 2011 compared to 4.7% in the first six months of 2010.

Benelux

In the first six months of 2011, revenues in Benelux increased by 15%. The operating income margin improved by 150 bps to 4.3% in the first six months of 2011 compared to the first six months of 2010.

Italy

Revenue growth in Italy remained exceptionally strong, increasing by 36%, mainly driven by continued strong growth in the Industrial business. Italy achieved strong improvements in profitability, as the operating income margin was up 210 bps to 6.4% in the first six months of 2011 compared to the same period of 2010.

Other

Revenues in the Nordics increased by 14% in constant currency. The operating income margin was 1.5% compared to 4.4% in the prior year’s first six months. The results of the first six months of 2011 were negatively impacted by EUR 9 related to the issues in the Medical & Science business in Norway.

In Iberia, revenues increased by 8%, despite the challenging economic conditions in the region.

Revenues were up 26% or 13% in constant currency in Australia & New Zealand in the first six months of 2011.

Switzerland grew revenues by 36% or by 20% in constant currency and continued to deliver very strong profitability, driven by strict cost control, with an operating income margin of 9.2% in the first six months of 2011.

Emerging Markets continued to perform strongly in the first six months of 2011 with revenues up 17% in constant currency, mainly driven by Eastern Europe and India. Operating income was up 23% in constant currency and the operating income margin was 2.8%.

Revenues of Lee Hecht Harrison (“LHH”), Adecco’s career transition and talent development business, amounted to EUR 109, a decline of 19% in constant currency, in the first six months of 2011. Operating income totalled EUR 21 and the operating income margin was 19.5%.