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Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
“Opportunities for growth”
Michael Page International
Investor Presentation
12th September 2007
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Agenda
1 Business Model and Group Strategy Steve Ingham
2 EMEA and The Americas – Introduction Charles-Henri Dumon
3 EMEA – Our Biggest Market
- France Charles-Henri Dumon
- EMEA excluding France Christophe Duchatellier
4 Germany – A Rapidly Developing Market Olivier Lemaitre
5 The Americas – The Future Alexis De Bretteville
6 Launch of a New Country – Brazil Patrick Hollard
7 Country and Global Job Counts Steve Ingham
Questions
Break
8 Asia Pacific – Introduction Gary James
9 Australia – Back On Track Phil Guest
10 China – The Opportunity Dan Chavasse
11 United Kingdom – Introduction Steve Ingham
12 Continuing Growth in the UK – Accounting and Finance Gary Watson
13 Continuing Growth in the UK – New Businesses Dean Ball
14 Increasing Candidate Shortages and Compliance/Legislation – Threat or Opportunity Oliver Watson
Questions and Close Steve Ingham
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Business Model and Group Strategy
Steve Ingham
CEO
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Business Model
and Group Strategy
• Launched, 1976, one team focused on accountancy
recruitment, permanent placements, in Central London
• Today, 2007, approximately 800 teams focused on 14
disciplines, permanent or temporary placements, from
141 offices in 24 countries worldwide
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Teams
• Focused by discipline, geography, perm or temp, as well
as skill/industry/level
• Each team, typically a manager and 4 consultants, owns
its own P&L
• Receives quarterly profit share, as bonus, which is
allocated, by contribution, to team members
• Grow by the addition of 1 consultant, costs increase by
c.20%, but potential to increase gross profit and bonus
by more
• When teams expand to 7/8 they become
2 teams. New manager promoted.
Greater focus
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Consultants
• With the ongoing growth of the brand and the success of
the group we are able to improve the quantity and quality
of the consultants we can attract, including a substantial
graduate intake
• Incentivised by profit share bonus, potential for
management, international moves, organic/meritocratic
career paths
• Motivated to work as team players –
long-term career vision ensures candidate/client referrals
• High level of customer service recognised by repeat
business from candidate/clients and bonus allocation
• Strong training/team coaching/support as model rewards
teams that ensure new consultants are profitable quicker
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
• Creates strong and consistent brands
• Profit focus leads to strong cost control, ensures higher
margins and creates the opportunity to invest throughout
a cycle
• Maximises referrals cross-discipline, nationally and
internationally
• A platform to allow rapid headcount growth – safely and
only as a reaction to actual business levels on a team basis
The Result
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
31 Years Of Organic Growth
Consistency around the world
• People
• Culture
• Management
• Service
• Product
• Technology
• Knowledge
‘Low risk, higher returns’
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
1976 v 2007
– Momentum Builds
International brand strength
• Attracting candidates, clients, consultants
• On-line presence
• Launching new businesses/countries
• Managing increasing compliance
• Managing increasing legislation
• Sourcing and recruiting internationally
• Providing clients with a multi-discipline ‘white collar’
recruitment solution
BUSINESS MODEL AND GROUP STRATEGY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA and The Americas
– Introduction
Charles-Henri Dumon
Managing Director - Continental Europe and The Americas
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Responsible for North America, Europe, Latin America (2005)
Launched Poland (2005)
Launched Russia (2006)
Launched Mexico (2007)
Launched Luxemburg (2007)
2003 – Present
Geneva
Managing Director and
PLC Board member
Continental Europe and
The Americas
Launched Switzerland (2001)
Launched Belgium (2002)
Launched Sweden (2002)
Responsible for Germany and Netherlands
2001 – 2003
Paris
Managing Director and
PLC Board member
Continental Europe
and Latin America
Charles-Henri Dumon Career History at Michael Page – 48 Years Old
Launched France (1986)
Launched Spain (1997)
Launched Italy (1997)
Launched Portugal (2000)
Launched Brazil (2000)
1986 – 2001
Paris
France
EMEA and The Americas - Introduction
MP France consultant
1985 – 1986
London
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA and The Americas - Senior Management
Charles-Henri Dumon (22)Continental Europe and The Americas
CFOFrancois Sallembien (12)
FranceFabrice Lacombe (13)
Rest of EuropeChristophe Duchatellier (15)
The AmericasAlexis de Bretteville (14)
Rest of AfricaPaul Mercier (20)
EMEA and The Americas - Introduction
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Biggest Market
• 65 offices in 15 countries (Jun 07)
• 1785 employees (Jun 07)
• Gross Profit £90m (YTD Jun 07)
2000
Portugal
1986
France
1987
Netherlands
1993
Germany
1997
Spain
Italy
2001
Switzerland
2002
Belgium
Sweden
2005
Poland
2006
Russia
Ireland
South Africa
U.A.E.
2007
Luxembourg
Openings
EMEA and The Americas - Introduction
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
France
Charles-Henri Dumon
Managing Director - Continental Europe and The Americas
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
MP France – Geographical Coverage
MP
PP
MP & PP
Virtual Office
FRANCE
Versailles Issy-les-Moulineaux
Neuilly-sur-Seine
ClichyCourbevoie
ParisParis
Paris
France Rest of Africa
Versailles Issy-les-Moulineaux
Neuilly-sur-Seine
ClichyCourbevoie
ParisParis
Paris
Paris
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
He
ad
co
un
t
0
100
200
300
400
500
600
700
800
900
Gross Profit £m
45
40
35
30
25
20
15
10
5
0
Total Headcount
*At reported rates
£m
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
Gross Profit* and Headcount – H1 2000 to H1 2007
FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Overview
• Michael Page’s 2nd largest country
• 2000 70% of EMEA and 25% of Group’s gross profit
• 2002/3 downturn, Group strategy and strength ensured:
- No office closures
- Maintained infrastructure
- Headcount reduced
• H1 2007 33% of EMEA and 13% of Group’s gross profit
FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
H1 2007
Growth rate improving during first half
* In local currency
** Includes ‘Rest of Africa’ team - launched 2006
FRANCE
Gross Profit £30m** +29%*
Headcount 589** +31%**
H1 2007
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Changes in legislation: the impact on us
Hays
Expectra
Adecco
€40,000
FRANCE
Hudson
Robert Half
Robert Walters
Mercuri Urval
€100,000
Heidrick & Struggles
Russell Reynolds
Egon Zehnder
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Market Characteristics
1995 2000 2003 2006 H1 2007
Gross Profit £m 7.4 68.1 32.9 47.5 29.7
+1.1%
+4.3%(2000/1999)
+1.3%(2003/2002)
+1.3%(2006/2005)21,190
98,400
32,800
53,500
% increase in the “cadres” population
• Recruitment of “cadres” (white collars)
increased 17% (2005/2006), to 200,000
recruitments in 2006
• Forecast 2007: increase of 3% to 9%
(207,000/220,000 recruitments in 2007)
• In 2006 34,200 “cadres” (white collars)
retired against 15,000 in 2000
• Construction, Sales, IT, Engineering, Retail,
Banking are the biggest growth markets
FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
• Number of clients: MP : 3,770 PP : 3,700
• Multinationals:
- HSBC - Bouygues Immobilier
- AXA Investment - Darty
- Terreal - Monoprix
- H&M - Samsung
- Legrand - Nestlé
• Locals:
- Société Mécanique Magnétique - Sogeres
• Financial Services recruitment represents less than 2% of
Gross Profit
• Construction/Real Estate: 10% of Gross Profit
• Finance, Sales and Engineering are our 3 largest disciplines
Our Clients
FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Future and Potential
• Continue office roll out
• Approximately 100,000 ‘white collar’ professionals
changed roles in the first 6 months of 2007. Michael Page
recruited 2,100 people – implied market share: 2.1%
• 2006: 602,000 temps (20 billion Euro turnover (£13.5 billion)
• Page Personnel number of temps: 1,500
• Only 20% of the recruitment is outsourced to recruitment
companies
• Candidate driven market, assisted by the strength of the
brands – premium pricing
• Depth of talent within Michael Page and Page Personnel; in
the downturn we retained the best
• In 2000 12.5 million people over 60, in 2020 19 million
people over 60
• Michael Page website ranked 8 of all job boards in France:
600,000 visits per month
FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA excluding France
Christophe Duchatellier
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Christophe DuchatellierCareer History at Michael Page – 44 Years Old
Responsible for Northern Europe
Responsible for Southern Europe
Responsible for Central and Eastern Europe
Launched Russia (2006)
Launched Luxemburg (2007)
2006 – Present
Geneva
Regional Managing Director
Continental Europe
EMEA EXCLUDING FRANCE
Responsible for Spain
Responsible for Italy
Responsible for Portugal
Responsible for Switzerland
2002 – 2005
Milan
Regional Managing Director
Southern Europe
Launched MP Italy (1997)
Launched PP Italy (2000)
Launched Switzerland (2001)
1997 – 2001
Milan
Managing Director
Italy and Switzerland
MP France consultant to director
Launched Assistants and Secretaries disciplines
1992 – 1996
Paris
France
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA excluding France – Senior Management
Christophe Duchatellier (15)Regional Managing Director
Continental Europe (excl. France)
Northern EuropePeter Rietvelt (18)
Central and
Eastern EuropeOlivier Lemaitre (10)
Southern EuropeNicolas Buisson (13)
Reporting to the UK
South AfricaAlain Cheenne (13)
U.A.E.Matt Gribble (10)
IrelandJamie Newman (15)
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA excluding France
MP
PP
MP & PP
Central & Eastern Europe
Northern Europe
Southern Europe
Middle East, Africa, Ireland
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
200
400
600
800
1,000
1,200
Gross Profit £m
64
56
48
40
32
24
16
8
0
Total Headcount
He
ad
co
un
t
£m
*At reported rates
Gross Profit* and Headcount – H1 2000 to H1 2007
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Overview
• In 2000 ‘EMEA excluding France’ was 30% of EMEA and
11% of Group’s gross profit
• In 2000 we had 16 offices in 6 countries
• Headcount reduced by 10% from its peak in 2001 to 327
in 2002
• Continued to invest during downturn
• Maintained infrastructure
• Opened new offices - Rotterdam
• Opened new countries - Switzerland, Belgium, Sweden
• H1 2007 ‘EMEA excluding France’ is now 40 offices,
14 countries
• H1 2007 now 67% of EMEA and 27% of Group’s
gross profit
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
EMEA excluding France
70.1% Growth
9.6%
29.4%
17.8%
18.1%
13.6%
11.6%
H1 2006
Gross Profit: £35.4m
Operating Profit: £12.3m
Headcount: 731
H1 2007
Gross Profit: £60.2m
Operating Profit: £22.9m
Headcount: 1,195
+86.2%
+63.5%
Gross Profit
Growth*
Holland +62%
Germany +82%
Spain +74%
Italy +51%
Switzerland +107%
Belgium, South Africa, UAE, Sweden, Poland, Portugal, Russia, Ireland, Luxembourg
+95%
11.0%
27.6%
18.8%
18.1%
11.8%
12.8%
*Growth rates are based on local currency
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Why we are growing so fast
• Low level of outsourcing (10 - 25%) and growing
• Weak competition
• Shortage of good candidates: leverage the power of
Michael Page/Page Personnel brands
• Changes in legislation
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Competitors
Southern Europe Eastern Europe Central Europe Northern Europe
Italy Poland Germany Belgium
1. Michael Page 1. Bigram 1. Michael Page 1. Hudson
2. Antal 2. Hrk 2. Kienbaum 2. Robert Half
3. Hays 3. Hays 3. Bauman 3. Michael Page
4. Antal/Michael Page
Spain Russia Switzerland Netherlands
1. Michael Page 1. Ancor 1. Michael Page 1. Michael Page
2. Hays 2. Antal 2. Mercuri Urval 2. YER
3. Hay Seleccion 3. Staffwell 3. Contaplus 3. Vitae Recruitment
Portugal Sweden
1. Michael Page 1. Mercuri
2. Hays 2. Michael Page
3. Ray 3. Hays
4. Egor
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Competition from
Staffing Agencies
• Adecco, Manpower, Vedior… trying to enter into the
permanent recruitment market
• What is their strategy?
- Adecco, Ajilon, Adecco Expert, Randstad,
Randstad Professionals…
• Do they have the top candidates?
• Do they have the right consultants?
• Do they have the right offices?
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Clients
• Top 100 clients less than 15% of gross profit
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Vision
• Continued penetration in existing markets
• Continued roll out of disciplines and new offices (doubling
in the next 10 years – 100 offices)
• New countries – Eastern Europe, Turkey,
Middle East, Africa
• c. 5,000 staff in 10 years
EMEA EXCLUDING FRANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Germany – A Rapidly Developing Market
Olivier Lemaitre
Managing Director – Central and Eastern Europe
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Responsible for Germany
Responsible for Switzerland
Responsible for Poland
Responsible for Russia
2006 – Present
Düsseldorf
Managing Director
Central and Eastern Europe
Responsible for Germany
2002 – 2006
Frankfurt
Germany
MP Brazil manager
2000 – 2002
Sao Paulo
Brazil
Olivier LemaitreCareer History at Michael Page – 35 Years Old
MP France consultant
1997 – 1999
Paris
France
GERMANY – A RAPIDLY DEVELOPING MARKET
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
German Recruitment
Market Characteristics
• Estimate 10% outsourced and increasing
• Culturally conservative in the way they do business
• Michael Page are the only recruitment consultants to
manage the process from A to Z
• Established local players:
- Kienbaum
- Baumann
- Steinbach & Partner
• International competitors downsized or pulled out in 2003
• Almost no specialist media
• Candidates changing jobs more frequently
• Legislative environment improving
GERMANY – A RAPIDLY DEVELOPING MARKET
- Dr. Heimeier & Partner
- Mummert
- IFP
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
20
40
60
80
100
120
140
160
180
200
Gross Profit £m
12
10
8
6
4
2
0
Total Headcount
He
ad
co
un
t
£m
*At reported rates
Gross Profit* and Headcount – H1 2000 to H1 2007
GERMANY – A RAPIDLY DEVELOPING MARKET
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Volume Frankfurter Allgemeine ZeitungFAZ volume increased by 5% year to date
GERMANY – A RAPIDLY DEVELOPING MARKET
0
50,000
100,000
150,000
200,000
250,000
BAUM
ANN
MIC
HAEL
PAGE
KIE
NBAUM
STE
INBACH
DR. H
EIMEIE
R
MUM
MER
TIF
P
DR. W
EBER
1st half year 20071st half year 2006
Co
lum
n M
illim
etr
es
+19%
+66% +9%
+31% +26% +157%-2%
+36%
Source: BDU 2000-06
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Germany - Gross Profit per Discipline
0
5,000
10,000
15,000
20,000
25,000
Finance S&M Eng/P&C/P&SC Tech Banking Other
GERMANY – A RAPIDLY DEVELOPING MARKET
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Current position
• 5 offices (Hamburg opened in Jan 07)
• 10 Disciplines (4 launched since Jan 07)
• 139 Fee Earners (+70%) (Jun 07)
• +82% Gross Profit Growth (H1 07)
GERMANY – A RAPIDLY DEVELOPING MARKET
Hamburg
Düsseldorf
Frankfurt
Berlin
Munich
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
57 FE
9 FE
0 FE
14 FE
29 FE
57 FE
Stuttgart
Opportunities across the country
2006 GDP by Region € EUR
Düsseldorf / NRW: 502bn
Munich / Region South: 409bn
Stuttgart / Region SW: 337bn
Frankfurt / Region Middle: 331bn
Hamburg / Region North: 411bn
Berlin / Region East: 316bn
London / South East: 540bn
Number of Fee Earners in London / South East
600
GERMANY – A RAPIDLY DEVELOPING MARKET
Hamburg
Düsseldorf
Frankfurt
Berlin
Munich
FE = Fee Earners
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Reasons for optimism
• So far, no international competitor with a long-term plan
for a permanent recruitment business
• Immature market, high exposure to the international
market, will develop quickly (higher turnover and
outsourcing ratio)
• Medium-term legislative changes will increase the labour
flexibility (perm, temp and contracting)
• Structural shortage of white collar workers, especially in
engineering, a key part of the German economy. MP is
strong in sourcing international candidates
• Largest economy in Europe with a public spending
budget surplus for the first time in 15 years
GERMANY – A RAPIDLY DEVELOPING MARKET
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Vision
• Full roll out of disciplines
• Open new offices in short-term - Cologne, Stuttgart
• Longer-term there are additional cities with populations
greater than 1m such as Hanover, Leipzig, Dresden
and Nurnberg
• Biggest offices (Dusseldorf/Munich/Frankfurt) with in
excess of 200 Fee Earners
• > 900 Fee Earners by 2015, 16 offices, and at today’s
productivity, approximately £250m gross profit
GERMANY – A RAPIDLY DEVELOPING MARKET
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Americas – The Future
Alexis de Bretteville
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Alexis de BrettevilleCareer History at Michael Page – 44 Years Old
Responsible for USA
Responsible for Canada
Responsible for MP Brazil
Responsible for Mexico
Launched PP Brazil (2007)
2006 – Present
New York
Regional Managing Director
The Americas
THE AMERICAS – THE FUTURE
Responsible for Holland
Responsible for PP Belgium
Launched Poland (2005)
2004 – 2006
Brussels
Responsible for Germany
Responsible for MP Belgium
Responsible for Switzerland
Responsible for Sweden
2002 – 2004
Frankfurt
Regional Managing Director
Northern Europe
Launched MP Spain (1997)
Launched PP Spain (1998)
Launched Portugal (2000)
Launched MP Brazil (2000)
1997 – 2002
Madrid
Managing Director
Spain, Portugal and
South America
MP France
Consultant to Director
1993 – 1997
Paris
France
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Americas - Senior Management
Alexis de Bretteville (14)Regional Managing Director - The Americas
East (US)Richard Vickers (13)
Managing Director
Mid-West (US)Stefan Renken (10)
Managing Director
South (US)Joost Fortuin (11)
Managing Director
CanadaMark Sharland (19)
Managing Director
Latin AmericaPatrick Hollard (12)
Managing Director
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Story So Far
THE AMERICAS – THE FUTURE
• North America launched 1998 in Chrysler Building,
New York
• 2001 market hit by economic downturn and 9/11
• Today, 9 offices, 233 staff, 5 disciplines
• Latin America launched 2000 in Sao Paulo, Brazil
• Today 4 offices, 187 staff, 8 disciplnes
• H1 2007 - The Americas was 7.5% of Group by gross profit
• H1 2007 total Americas: 420 staff, 13 offices, Brazil,
Mexico, USA and Canada
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
50
100
150
200
250
300
350
400
450
Gross Profit £m
18
16
14
12
10
8
6
4
2
0
Total Headcount
He
ad
co
un
t
£m
*At reported rates
Gross Profit* and Headcount – H1 2000 to H1 2007
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Americas
76.1% Growth
41%
59%
H1 2006
Gross Profit: £9.7m
Operating Profit: £1.6m
Headcount: 272
H1 2007
Gross Profit: £17.1m
Operating Profit: £2.9m
Headcount: 422
+83.4%
+55.1%
Gross Profit
Growth*
North America +90%
Latin America +85%
42%
58%
*Growth rates are based on local currency
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Overview - North America
• Now have presence in 3 regions in US - East, Mid-West,
South
• East has 6 offices with addition of Hartford (Connecticut) in
H1 07
• Roll out of Sales, Marketing, HR continuing across network
• Mid-West (Chicago) now established. New replacement
office in H2 07 for increasing headcount
• South launched in H1 07 in Atlanta
• Headcount up (48% yoy) on the back of significant senior
management investment (transfers from UK/Europe)
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Overview - Latin America
THE AMERICAS – THE FUTURE
• Mexico ahead of plan and profitable
• Sales & Marketing discipline launched in H1 07
• Brazil’s growth continues, now 8 disciplines
• Launched Page Personnel in H1 07
• Headcount grown significantly (+64% yoy) to 176
• Newest office (Campinas) performing ahead of
expectations
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Key Characteristics
– North America
• Very candidate-driven: multiple agency registration/offers/
buy-backs
• Approximately 35% outsource recruitment
• Recruitment industry has poor image/reputation:
- Low service levels
- Commission driven
• Notice periods typically 2 weeks - increasing turn-over.
Average tenure 2-4 years
• Limited print advertising
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Key Characteristics
– Latin America
• Client driven market, but increasingly becoming
candidate-driven
• Less than 30% of recruitment outsourced
• Typical ‘white collar’ professional profile:
- Hard working/flexible/entrepreneurial – therefore
high turnover
• Recruitment industry very new and under-developed
• Limited/fragmented competition: no Michael Page
look-alike
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Competition - North America
18,000 firms performing temporary and permanent recruitment
Adecco300+ US and Canadian offices
Manpower859 US and 21 Canadian offices
Randstad231 US and 31 Canadian offices
Kforce70 US offices
Robert Half/Accountemps242 US and 18 Canadian offices
Ajilon (Finance & Consulting) 110 US and Canadian offices
Account Pros (Vedior) 13 US offices
Heidrick & Struggles20 US and 1 Canadian office
Korn Ferry20 US and 4 Canadian offices
Russell Reynolds11 US and 1 Canadian office
Staffing Executive
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Business Model
• Specialist Focus
• Consultants not Agents
• Profit Share and Fixed Salary,
Not Commission-Based
• Adding Integrity to Industry
• Enhance Long-Term Partnerships
• Web and Print Advertising
• Exclusive Assignments
• Unique, Cutting-edge Marketing Tools
Targeting Candidates
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Strategy
Launched on East Coast (USA) and Brazil
Build the brand, establish reputation, focus on one discipline
When established:
• Grow office – New York and Sao Paulo
• Open 2nd offices – New Jersey and Rio de Janeiro
• Roll out further disciplines
• Look to new countries/regions in North/Latin America
Why?
• Capitalises on strength of brand
• Builds consistent brand awareness (voted no.1 Recruitment
Company in New York/Boston)
• Improves our ability to attract consultants
• Maximises management control
• Minimises risks
• Maximises the rate of growth
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Clients
• Michael Page has more than 4,000 clients in the Americas
ranging in size from large, global multi-nationals, to small
local businesses
• Diverse client portfolio including: Pharmaceuticals,
Financial Services, Consumer Products, Retail, Advertising,
Legal, Media & Marketing, Information Technology, Mining
& Natural Resources, Automotive and Biotechnology
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
What our clients say about us
THE AMERICAS – THE FUTURE
“Michael Page has great screening. I knew that any candidate
that we saw would be a great skill set match.”
Human Resources Manager, Heineken
“Michael Page was a breath of fresh air, I am so impressed with
the quality and volume of resumes I received after just one
posting. In fact a few members of my team were resourced by
Michael Page and with each candidate I am experiencing a great
deal of success.”
Operations Control, UBS Investment Bank
“Michael Page is a quality firm, with a decent track record in filling
several of our more challenging roles at Cadbury over the last 12
months. I look forward to a continued working relationship.”
Director of Resourcing,
Cadbury Schweppes American Beverages
“I find Michael Page International professional, diligent, productive
with a very good understanding of the market as well the time
urgency needed in recruiting successfully. I highly recommend
Michael Page for their network and understanding of my needs
and core business.”
International Recruiter, BDO Seidman
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Future and Potential
• The Brand and the senior management team well
established
• Momentum building as local hires progress into
management
• Roll out of new disciplines/offices gets easier
• 2008: potential office openings in Buenos Aires (Argentina),
Curitiba (Brazil), Paramus (New Jersey), Montreal (Canada)
• MP website awareness gaining momentum and response
• No limits to our potential
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Current Locations 2007USA :
New York
Chicago
Philadelphia
Boston
Atlanta
Stamford
Hartford
Edison
Canada :
Toronto
Brazil :
Sao Paulo
Rio de Janeiro
Campinas
Mexico :
Mexico City ( DF )
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Future 2015USA :
New York
Chicago
Philadelphia
Boston
Atlanta
Stamford
Hartford
Edison
Paramus
Long Island
Los Angeles
Houston
Phoenix
San Antonio
San Diego
Dallas
Detroit
Indianapolis
San Francisco
Columbus
Austin
Baltimore
Charlotte
Seattle
Washington
Denver
Las Vegas
Nashville
Portland
Cleveland
Miami
Oakland
Minneapolis
Raleigh
St. Louis
Salt Lake City
Canada :
Toronto
Montreal
Missisauga
Vancouver
Calgary
Ottawa
Edmonton
Brazil :
Sao Paulo
Rio de Janeiro
Campinas
Curitiba
Belo Horizonte
Porto Alegre
Mexico :
Mexico City ( DF )
Santa Fe
Monterrey
Guadalajara
Argentina :
Buenos Aires
Mendoza
Cordoba
Chile :
Santiago
THE AMERICAS – THE FUTURE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Launch of a new country – Brazil
Patrick Hollard
Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Launched Mexico (2006)
Launched PP Brazil (2007)
2006 – Present
Brazil
Managing Director
Latin America
Patrick HollardCareer History at Michael Page – 39 Years Old
Launched Sao Paulo office (2000)
Launched Rio de Janeiro office (2002)
Launched Campinas office (2006)
2000 – 2006
Brazil
Managing Director
Brazil
LAUNCH OF A NEW COUNTRY – BRAZIL
MP France
Consultant to Director
1996 – 1999
Paris
France
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Picture Today
Country :
• 190m people, top ten world economy
MP Brazil :
• 7 years old
• 3 offices
• 176 staff (H1 2007)
• Leader in the recruitment market
• Two brands: Michael Page and Page Personnel
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Why go to Brazil?
• Size of the country
• Opens the door to the South American continent
• Strong presence of International Brands (498 of top 500
world companies are in Brazil)
• Very immature recruitment market
• No competition in middle-management market
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
First Step:
Jul to Dec 1999
Market survey:
• SWOT analysis: visits to companies, HR and operations,
interviews of candidates, evaluation of competition, media,
social and legal characteristics
Start-up team:
• Experienced and motivated MP people
Support structures:
• Finance and IT systems, office costs, budget
Group Board approval
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Second Step:
From Jan 2000 onwards
Build a team:
• Recruitment of Brazilians to be trained in Europe
(6 months)
• Learn business model and our culture
Build a brand:
• Focus first on Finance recruitment
• Negotiate with local specialised newspaper
(Gazeta Mercantil)
• Develop, launch and promote our website to attract
candidates
Build a company:
• Recruit and train backoffice IT/Finance team
• First few months a virtual office, e.g. Regus, then quickly
move to our own office
• Implementation database/processes according to
Group standards
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Michael Page secret:
a very strong culture
Strong team:
• Recruit top people and train them. Make people dream and
make sure that their dreams become true
Strong commercial:
• Promote our business model by visiting potential clients
(min. 5 client visits a week per consultant)
Interview candidates:
• To build a database (min. 15 candidates interviewed a
week per consultant)
Focus on results:
• Success fee culture and celebration
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
20
40
60
80
100
120
140
Gross Profit £m
7
6
5
4
3
2
1
0
Total Headcount
He
ad
co
un
t
£m
*At reported rates
Gross Profit* and Headcount – H1 2000 to H1 2007
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Organic growth : accelerating
factors
• Management
- In 2002 only 3 managers
- Today 35 managers
• We can grow much faster today
- Open new divisions to become multi-specialism
recruiters
- Open new offices in Brazil
- Export senior consultants overseas and duplicate our
model in other countries
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Mexico:
A “copy/paste” of Brazil
• Started in July 2006
• First Mexican consultants trained in Brazil
• Today 15 consultants, including one European (MD) and 2
Brazilians
• First profits after 6 months
• 4 disciplines:
• Finance and Banking
• Marketing and Sales
Next country : Argentina
LAUNCH OF A NEW COUNTRY – BRAZIL
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Country and Global Job Counts
Steve Ingham
CEO
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Decreasing relevance and correlation,
increasing over reliance
• 23% of fee earners in Page Personnel, therefore no impact
• Restructure in Europe means all junior perm roles transferred to Page Personnel website
• Multiple assignments for similar roles recorded once
• Speed of completion on temporary roles means they are often not recorded
• Increasing need to source candidates across other international markets – job counted in each country
• Does not show ‘churn’ within the job count
• Increasing candidate shortages means decreasing relevance of job counts and increasing relevance of candidate counts
• Works against us in new markets
COUNTRY AND GLOBAL JOB COUNTS
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Growth of On-line
• Job boards investing heavily in technology
• MP utilises all on-line methods to source candidates:
• Job boards
• SEO
• PPC
• MP/PP websites
• 37% of candidates register CV on-line
• 65% of candidates received interview via on-line
application
• In the UK 83% of all candidates received on-line versus
17% off-line, 43% of which came via MP site and growing
• In the USA 87% of all candidates received on-line versus
13% off-line, 50% of which came via MP site and growing
COUNTRY AND GLOBAL JOB COUNTS
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Conclusion• On-line strategy will focus entirely on candidate generation
• During Q4 job count will go
COUNTRY AND GLOBAL JOB COUNTS
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Questions
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Asia Pacific – Introduction
Gary James
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Gary JamesCareer History at Michael Page – 45 Years Old
Responsible for Australia
Responsible for China
Responsible for Hong Kong
Responsible for Japan
Responsible for Singapore
2006 – Present
Australia
Regional Managing Director
Asia Pacific
ASIA PACIFIC
Responsible for USA
Launched Canada (2005)
2002 – 2006
USA
Regional Managing Director
North America
Responsible for UK Sales & Marketing
1992 – 2002
UK
UK
MPUK – consultant to director
Launched UK Technology
1984 – 1992
UK
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
100
200
300
400
500
600
Gross Profit £m
30
25
20
15
10
5
0
Total Headcount
He
ad
co
un
t
£m
*At reported rates
Gross Profit* and Headcount – H1 2000 to H1 2007
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Asia Pacific
25.2% Growth
40%
60%
H1 2006
Gross Profit: £21.6m
Operating Profit: £7.8m
Headcount: 390
H1 2007
Gross Profit: £27m
Operating Profit: £9.8m
Headcount: 501
+26.4%
+28.5%
Gross Profit
Growth*
Australia +20%
Rest of Asia Pacific +49%
43%
57%
ASIA PACIFIC
*Growth rates are based on local currency
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Growth of the region
The Drivers of Growth
• Economic maturity of country
• Sophistication of employers to external recruiters
• Cultural change in career aspirations of individuals
• Regulatory restrictions
• Availability of resource
1985
Australia
1994
Hong Kong
Openings
1996
Singapore
2001
Japan
2003
China
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Current MPI Market Positioning
Staffing Executive
Admin & Clerical Junior & MiddleManagement
Senior & Board Level Appointments
Adecco
Randstad
Vedior
Kelly
Manpower
RHI
RWA
Hays
Hudson
Heidrick & Struggles
Korn Ferry
Russell Reynolds
Spencer Stuart
ASIA PACIFIC
Specialist
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
MPI differences
within the region
• Time in market: diversity of business
• Local economic influences: mix of disciplines
• Cultural/behavioural: nature of business
• Legislative/regulatory: speed of entry
One Constant: Specialists
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Competitive landscape
• Enormous diversity across region
• Junior appointments often local
• Search firms and boutiques at senior level
• Niche specialists on regional basis
• Limited number of regional multi-discipline specialists
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Competitive Landscape
• Similar country coverage
• Australia dominant for all
• Hudson/Hays greater presence
in staffing
• Our relative size and productivity
encouraging for future
0
5
10
15
20
25
30
35
40
45
Hays Hudson MPI RWA RHI
Number of Asia Region Offices
0
92
184
276
368
460
552
644
736
828
920
Hays Hudson MPI RWA RHI
Number of Asia Region Fee Earners (estimated)
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Asia Pacific Strategy
• Consistent with Group
• Roll out existing disciplines to existing offices
• New disciplines and new offices
• New countries: Malaysia, New Zealand, South Korea, Taiwan
50% world population vs. 37% world economy with the gap
closing over next 7 years
ASIA PACIFIC
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Australia – Back on TrackPhil Guest
Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Phil GuestCareer History at Michael Page – 37 Years Old
AUSTRALIA – BACK ON TRACK
Responsible for Australia
2006 – Present
Australia
Managing Director
Australia
Finance DirectorAsia Pacific
1999 – 2006
Australia
Finance Director
Asia Pacific
Guiness Australia(part of Diageo plc)
1997 – 1999
Australia
Finance Director
Australasia
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Market Overview
• The 12th largest economy in the world
• 16 years of uninterrupted economic growth
• Sophisticated knowledge-based economy
• Services account for 77% of economic activity
• Recruitment is a AUS $16 billion industry
• Implied MPI share < 1%
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Business
• Started in 1985
• 7 offices in Sydney (3), Melbourne (2),
Brisbane & Perth
• 9 disciplines including Finance, Financial Services, Sales,
Marketing, Human Resources, Legal, Technology,
Engineering & Manufacturing, Procurement & Supply Chain
• 218 Fee Earners/340 staff (June 2007)
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
What were the issues?
• Lack of growth - particularly from newer and less
established businesses
• Management Structure - geographical rather than
by discipline
• Systems Integration - Lotus Notes to Profile
• Culture
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
What changes were made?
• New Managing Director 5/06
- Australia
• New Regional Managing Director 8/06
- Asia Pacific
• New management structure – by discipline 9/06
• Drive to change culture – the same as
Michael Page around the world
- Entrepreneurial H2/06
- Meritocratic
- Team based
- Competitive/driven/hungry
- Ambitious/new vision
• Back to basics H2/06
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Gross Profit Q1 2004 to Q2 2007
0
5
10
15
20
25
Q1
2004
Q2
2004
Q3
2004
Q4
2004
Q1
2005
Q2
2005
Q3
2005
Q4
2005
Q1
2006
Q2
2006
Q3
2006
Q4
2006
Q1
2007
Q2
2007
20.2
17.016.016.616.5
14.613.0
16.016.113.813.914.5
13.3
10.9
Gross Profit
AUS $m
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Gross Profit Growth Rates %Year on Year Growth %
Q3
2005
Q4
2005
Q1
2006
Q2
2006
Q3
2006
Q4
2006
Q1
2007
Q2
2007
23%
17%
24%
3%2%
6%
-7%
11%
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Australia
19.9% Growth
11%
10%
12%
13%
54%
Gross Profit
Growth*
Finance & Financial Services +12%
Sales & Marketing +27%
Technology +10%
Legal, Human Resources and Engineering & Supply Chain
+44%
Perth +42%
13%
12%
11%
14%
50%
H1 2006
Turnover: A$76.2m
Gross Profit: A$31.1m
Fee Earners: 157
H1 2007
Turnover: A$84.0m
Gross Profit: A$37.2m
Fee Earners: 218
+19.9%
+38.9%
*Growth rates are based on local currency
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
• Total number of clients YTD 1,524
• Percentage of Gross Profit from:
- Top 10 Clients 13%
- Top 100 Clients 43%
• National and International Clients are equally represented
by Gross Profit
• Large listed Clients are 80% of Gross Profit v 20% from
SMEs
Our Clients
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Opportunities
• Higher productivity
• Expansion of headcount in existing offices
• Roll out existing disciplines
• Launch new disciplines e.g. Property & Construction
• Michael Page Executive Search
• New offices Adelaide, Canberra
• In 10 years 1,000+ fee earners
AUSTRALIA – BACK ON TRACK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
China – The Opportunity
Dan Chavasse, Managing Director,
Greater China & SE Asia
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Dan ChavasseCareer History at Michael Page – 44 Years Old
Responsible for Greater China
Responsible for South East Asia
Responsible for Singapore
2005 – Present
China
Managing Director
Greater China and South East Asia
CHINA – THE OPPORTUNITY
Responsible for Greater China
1999 – 2005
China
Managing Director
Greater China
Responsible for UK Finance in home counties
1997 – 1999
UK
UK
MP UK – consultant to director
1989 – 1997
UK
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
History
• 1994: MP is the first international recruitment firm to set up in
Hong Kong
• Prior to 2000: China not viable from a recruitment perspective
- No rule of law, MNC’s losing money, low salaries, high
personal tax rates = no interest from
candidate community
• 2000: WTO entry paves way for rapid Foreign Direct Investment
• 2002 – 2003:
- WTO entry, improved corporate profitability => candidate
PULL factor into China
- Recession/SARS in Hong Kong, SE Asia and beyond =>
candidate PUSH factor into China
• 2004 & beyond:
- Further acceleration in corporate profitability, lowering of
barriers to entry leading to dearth of qualified middle-
management across all disciplines and most organisations
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Characteristics of the
recruitment market
– Cultural
• The recruitment sector did not exist in any recognisable
form 10 years ago
• Reluctance to share thoughts/opinions/feedback
• Reluctance of some clients to share knowledge. Keep
matters ‘in-house’
• Issues of integrity – outsource our reference checking
process
• Limited interest in the western concept of loyalty/career
development. Traditional retention methods often fail –
good and bad for us
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Characteristics of the
recruitment market
– General
• 3 distinct levels of candidates – Local Chinese, Returnees,
Asia Expatriates
• Salary increases of 20-80% when moving jobs
• Fees: 25% or a minimum fee of USD 10,000
• ‘Advertised Selection’ model unheard of:
- No national print media. No ‘Appointments’ sections
- 2 job boards
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Characteristics of the
recruitment market
– Regulatory
• Illegal to run a foreign-owned recruitment company without
a local partner
• Must have a minimum of 5 employees with a recruitment
licence (exam is in Chinese)
• Separate and different requirements between major cities
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Characteristics of the
recruitment market
– Competition
• Five major western recruiters have a local partner
• By far the biggest competitor is direct recruitment
• Thousands of local ‘mom & pop’ shops who rely on
headhunting to acquire candidates
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Highlights of our
China Business to date
• Secured a successful local partnership agreement where
we have 100% operational control
• Never lost money, doubled profit year-on-year in first 3
years, +46% YTD
• Increased fee earners from 6 to 13 in 2006, 20+ forecast
by end of 2007. Strong team of multinational consultants
in place
• Achieved well over the requisite number of consultants
holding Recruitment Licences
• Set up Procurement & Supply Chain in 2007
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Origin of placed candidates
0%
10%
20%
30%
40%
50%
60%
70%
80%
Local Expat Returnee
8%14%
78%
12%
30%
58%
28%
38%34%
2005 2006 2007
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Top Clients
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Next Five Years
– Opportunities
• Investment banks and law firms scaling up
• Wage inflation normalising salaries
• Demographics moving in our favour
• Relaxation of regulatory requirements
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Next Five Years
– Threats
• Beijing/Guangzhou remain ‘hardship postings’
• Hiring sufficient top quality consultants and developing
them to manager level effectively
• Competitor recognition of the opportunity
• ‘Getting things done’ remains hard
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Next Five Years
– Conclusion
• The model works – don’t change it
• Remain specialist – roll out new disciplines in existing and
new geographies (Beijing, Shenzhen, Guangzhou)
• Further exploit online proposition
• Hire, retain and develop more good people
• Remain focused – achieve profit growth in excess of 30%+
CHINA – THE OPPORTUNITY
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
United Kingdom – Introduction
Steve Ingham
CEO and UK Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
UK - Senior Management
Steve Ingham (20)CEO and UK Managing Director
Gary Watson (23)
Regional Managing Director
Finance, Financial Services,
Secretarial
Paul Kinsey (23)
Regional Managing Director
Accountancy Additions, Page
Personnel, Scotland, Ireland
Dean Ball (19)
Regional Managing Director
Property & Construction,
Procurement & Supply Chain,
Engineering
Paul Wilson (20)
Regional Managing Director
Human Resources, Legal,
Technology, South Africa
Oliver Watson (12)
Regional Managing Director
Sales, Marketing, Retail,
U.A.E.
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
No. of Fee Earners vs No. of Offices
Finance & Accounting
Banking/Legal
Marketing
Technology
Accountancy Additions
Sales
Retail
Human Resources
Engineering, Procurement & Supply Chain
Secretarial
Property & Construction
PP Office Support
1976 1985 1986 1988 1991 1994 1998 2000 2004 2005 2006 H1 2007
No. of Fee Earners 2 78 82 105 109 220 528 714 830 933 1152 1207
No. of UK Offices 1 8 10 12 14 22 38 46 47 48 46 48
2007
1985
1976
1988
1986
1994
1990
2000
1998
2001
2006
2004
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Market share of recruitment companies
UKImplied
MP share
2005/6 Total Industry Turnover* £24.838bn 1.1%
2005/6 No. of permanent placements* 706,080 1.5%
2005/6 No. of temps on payroll* 1,265,060 0.3%
2005/6 No. of fee earners in recruitment industry* 97,674 1.0%
*Annual Recruitment Survey, REC (Recruitment & Employment Confederation)
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800 100
90
80
70
60
50
40
30
20
10
0
Gross Profit £mTotal Headcount
He
ad
co
un
t
£m
Gross Profit and Headcount – H1 2000 to H1 2007
H1
2000
H2
2000
H1
2001
H2
2001
H1
2002
H2
2002
H1
2003
H2
2003
H1
2004
H2
2004
H1
2005
H2
2005
H1
2006
H2
2006
H1
2007
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
United Kingdom
21% Growth
5%
15%
4%
21%
55%
Gross Profit
Growth
Finance & Accounting +14%
Marketing, Sales & Retail +21%
Legal, HR, Technology, Secretarial and other
+29%
Engineering, Property & Construction, Procurement & Supply Chain
+52%
Scotland +49%
6%
16%
4%
22%
52%
H1 2006
Gross Profit: £76.0m
Operating Profit: £19.6m
Headcount: 1,387
H1 2007
Gross Profit: £92.0m
Operating Profit: £28.6m
Headcount: 1,615
+46.2%
+16.4%
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Opportunities
• Grow market share from strong base
• Roll out existing disciplines
• Roll out Page Personnel to 60 offices
• Roll out Page Personnel to other disciplines
• Expand existing offices
• New Michael Page offices – Aberdeen, Canary Wharf,
West London (Chiswick), Newcastle, Cardiff and others
UNITED KINGDOM
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Continuing Growth in the UK
– Accounting and Finance
Gary Watson
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Gary WatsonCareer History at Michael Page – 46 Years Old
Responsible for Finance
Responsible for Financial Services
Responsible for Secretarial
Responsible for Executive Search
2006 – Present
UK
Regional Managing Director
UK
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Responsible for Finance
Responsible for Legal
2001 – 2006
UK
Managing Director
UK
Responsible for Finance
Responsible for Legal
1998 – 2001
UK
Regional Director and Deputy
Managing Director
UK
MP UK consultant to director
1984 – 1998
UK
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
MP Public Sector
(1992)
Our Finance Business - The History So Far
1976
1986
1996
2007
Years
-
-
3
37
No. of Offices
AA MP
1
6
10
22
MPP Formed
MP Finance
(1976)
MP Tax
(1986)
MP Financial Services
(1985)
MP Finance
MP Treasury
(1998)
MP Financial Services
MP Tax
MP Finance
4
106
256
612
Total Fee
Earners
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
AA
(1992)
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Market Characteristics
• Total size of the Accounting & Finance recruitment market
estimated at £3.2billion
• Proportion of hiring through recruitment organisations v
direct estimated to be 75:25
• MP market share in Accounting & Finance varies by level,
region and sector
• Overall share estimated at 3%
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
MP Finance - The Competition
National Local Specialist Search Staffing
Hays Macildowie Pure Odgers Adecco
Robert Half Stark Brooks Brewer Morris Hoggett Bowers Randstad
Badenoch & Clark Sharp Consultancy Barclay Simpson Whitehead Mann Manpower
Hudson Nigel Wright Morgan Law Harvey Nash
RWA Select Financial Allen Lane Howgate Sable
Reed Witan Jardine BLT Hanover Fox
Nigel Lynn Finance Professionals
Imprint
MWA
Highly fragmented market with national, local, specialist and search organisations
all competing in the Michael Page space
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Recruitment Market Evolution
• Significant shift from print to on-line advertising
• The FT remains the premium print brand:
- MP has been and continues to be the largest advertiser
in the FT by a factor of 3 for the last 20 years
• Specialist job boards include: gaapweb, ft.com,
efinancial.com, accountancyage.com, totallyfinancial.com,
jobsfinancial.com and many others
• Generic job boards include: monster, totaljobs, fish4jobs
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our Clients
• Banking, Insurance, Professional Services, Pharma, Energy,
Consumer, Retail, Telecoms, Healthcare, Engineering,
Electronics, Leisure, Technology, Construction, Publishing,
Central Government, Local Government, Charities and
NFP, Property, Logistics, Utilities
• All sizes: Ranging from OMBs through to SMEs through to
Blue-chips
• Total number of clients in 2006 was 8,000
• Our top 10 clients represent 6% of gross profit
• Our top 100 clients represent 26% of gross profit
• No one dominant sector
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Michael Page UK –
geographical coverage
MP
AA
MP & AA
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Our growth strategy
A simple strategy that continues to stand the test of time:
• Focus on specialist recruitment - and where appropriate
we create more specialist offerings within disciplines
• Grow organically - one set of values, one culture,
one company
• Diversify - by geography and by discipline
• Leverage the strength of the brand
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Why is this achievable?
• Only 3% market share
• Highly fragmented market
• Keeping it simple
• New locations: Aberdeen, Leicester, Chiswick, Canary
Wharf (2007), Newcastle, Cardiff, Canterbury and
Wolverhampton (2008)
• More profit centres/focused teams
• Increased specialisation
• Greater penetration
CONTINUING GROWTH IN THE UK – ACCOUNTING AND FINANCE
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Continuing Growth in the UK – New Businesses
Dean Ball
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Dean BallCareer History at Michael Page – 39 Years Old
Responsible for Engineering
Responsible for Procurement & Supply Chain
Responsible for Property & Construction
2006 – Present
UK
Regional Managing Director
UK
CONTINUING GROWTH IN THE UK – NEW BUSINESSES
Launched Engineering (2001)
Launched Procurement & Supply Chain (2003)
Launched Property & Construction (2005)
2001 – 2006
UK
Managing Director
UK
Responsible for Finance
1998 – 2001
USA
Regional Director
USA
MP UK consultant to manager
1988 – 1998
UK
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
H1 2007
• Combined Gross Profit represents 11% of UK
• Combined growth in Gross Profit 41%
• Total fee earners +45%, 154 H1 2007
• Total office locations 12, 13 by year end
CONTINUING GROWTH IN THE UK – NEW BUSINESSES
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Strategy for Growth
• Experienced Michael Page management plus consultants
with relevant background
• Create teams in existing locations
• Leverage current MP relationships, develop new
• Grow discipline brand awareness, develop focused teams
• Grow teams and new management to split and create
more focus by new locations, industry, job type
• Grow with candidates who become clients
• Leverage Michael Page brand and marketing power to
attract candidates
- Online
- Referrals, etc. in these candidate short markets
CONTINUING GROWTH IN THE UK – NEW BUSINESSES
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Competition
• Mixed feedback
• Some are well established
• Many lack brand leverage and infrastructure of MP
Human Resources Engineering & Manufacturing
Procurement & Supply Chain
Property & Construction
Hays Jonathan Lee Purcon Hill McGlynn
Hudson Quantica Supply Chain Personnel Judd Farris
Strategi Nigel Wright Hays MacDonald & Co
Consult Ellis Fairbanks Hudson Hays
Digby Morgan Hudson Quest Eden Brown
Highly fragmented market with national, local, specialist and search organisations
all competing in the Michael Page space
CONTINUING GROWTH IN THE UK – NEW BUSINESSES
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
The Future
• Growing candidate shortages
• Increasing international flow of candidates
• Large market places – 120,000 IPD, 270,000 Chartered
Engineers, 42,000 CIPS members, 20,000 ILT members
• MP market shares < 3%
• 10 MP offices with no presence from any of these
businesses
• Increasing drive by clients to hire stronger candidates
• Increasing frequency of job moves by candidates including
temp/interim/contracts
• In excess of 1,000 fee earners in 10 years
• New disciplines, e.g. Healthcare
CONTINUING GROWTH IN THE UK – NEW BUSINESSES
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Increasing Candidate Shortages
and Compliance/Legislation
– Threat Or Opportunity?
Oliver Watson
Regional Managing Director
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Oliver WatsonCareer History at Michael Page – 38 Years Old
THREAT OR OPPORTUNITY?
Responsible for Sales
Responsible for Marketing
Responsible for Retail
Responsible for UAE
2006 – Present
UK
Regional Managing Director
UK
Responsible for Sales
2002 – 2006
UK
Managing Director
UK
MP UK -
consultant to director
1995 – 2002
UK
UK
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Candidate Shortage
• Current market has significant skills and candidate
shortages
• Many disciplines and geographies are seeing structural
shortage:
- Legislative requirements e.g. Corporate Governance,
Compliance
- Corporate confidence in growth strategies
- International movement of labour
- Reduced graduate intakes in 2002/2003
- Increase in service/knowledge based roles v
manufacturing
• ‘Recruitment is the biggest growth restrictor for 55% of
UK Companies’
(KPMG Survey 2007)
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Candidate Shortage
• Scarcity of labour resource a positive?
• Searching for the talent is time consuming and requires
expertise (74% of UK Companies outsource recruitment –
REC Survey 2007)
• Increasingly complex to know where to go for candidates
(800 Job Boards in UK in 2007)
• When you do find them they need to be persuaded to
apply for jobs/organisations
• This drives employers to use recruitment consultants
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Candidate Shortage
• Clients in turn are more flexible on requirements and move
quickly to attract talent
• Candidates are confident that their skills are valuable and
with a largely stable economy will continue to move jobs
• Both candidates and clients are seeking choice which
drives them to agencies with brands and track records
• Candidate shortages drive fee inflation and wage inflation
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Candidate Shortage
• Key success criteria: our ability to attract high volumes of
quality candidates
• Attracting them, capturing them, advising and building
relationships with them is critical
• Comprehensive on-line strategy (2005 – 17%, 2007 – 78%
Jobseekers are on-line: Marketing Week June 2007)
• Strong off-line presence – National Press
• Local offices to serve local markets all over the world
• International offices to drive international referrals through
networked database
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Candidate Shortage
• Breadth of discipline coverage to assist referrals amongst
‘white collar’ workers
• In-depth training that leads to expertise in sourcing
and networking
• Breadth of client base – FTSE, SME’s
• Delivering great customer service
• Delivering results – re-enforcing the Brand reputation
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Compliance and Legislation
• Increasing compliance and ‘best practice’ includes
- ID checks / visa checks
- Qualification checks
- Referencing
- Employment Legislation, e.g. Age Discrimination
- Diversity
- Data Protection
• International movement of labour and candidate shortages
will keep compliance high on the agenda
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Compliance and Legislation
• Managing compliance is complicated and time consuming
• Outsourcing recruitment means others shoulder the burden
• Increasing compliance drives up service levels
• Opportunity to add more value and build deep relationships
with clients
• Responsibility and risk deters new entrants to the
recruitment market
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Compliance and Legislation
• In-depth consultant training required
• Strong administrative support
• World-class global technology platform
• Plays to MPI strengths as a well-resourced, accountable,
market-leader
• Not often a strength in competitors or HR functions
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Summary • Increasing candidate shortages, compliance/legislation
‘Plays to Michael Page’s strengths and highlights
competitors (including HR departments) weaknesses’
THREAT OR OPPORTUNITY?
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Conclusion
Steve Ingham
CEO
Michael Page International is a world leading recruitment consultancy
141 offices in 24 countries worldwide | www.michaelpage.co.uk
Conclusion & Questions
• Strong, consistent, simple, proven business model
• Strong global brand – off and on-line
• Clear strategy for growth
• Trends working in our favour
• Increasing depth of talent to deliver growth
• Outstanding scope for growth
CONCLUSION