Recruiter Robert Walters (>> Robert Walters PLC) sees a more challenging jobs market in Britain after Brexit and expects its U.K. operations to become a smaller part of its business over the next few years as it seeks international expansion.
The firm, which places people in finance, engineering, legal and marketing jobs, sees about 20 percent of net fee income coming from the U.K. in 5-10 years' time, down from about 31 percent now, Chief Financial Officer Alan Bannatyne told Reuters.
The firm posted on Wednesday a record 2016 pretax profit of 28.1 million pounds, up 26 percent year on year. It operates in 15 countries including Japan.
However, in line with statements from British rivals PageGroup (>> Pagegroup PLC), Hays (>> Hays plc) and SThree (>> SThree Plc), Robert Walters said the Brexit vote had hit confidence and activity among individuals and firms in the U.K.
People tend to switch jobs more frequently when confidence levels rise.
PageGroup has said the uncertainties stemming from Brexit could linger, while Hays has noted only gradual improvement in the U.K. market since the vote.
CEO Robert Walters said he expects the London banking market to remain weak as firms worry about how to keep serving their European Union clients from U.K. bases once Britain leaves the bloc.
Importers were struggling too due to the pound's slide <GBP=> <EURGBP=>, he added.
However, "outsourcing is a big part of (Robert Walters') U.K. business, while recruitment is largely an international business so we're not as affected as we would have been without that footprint overseas," Walters said.
The outsourcing unit and resilient post-Brexit trading in the U.K. commerce finance market and U.K. regions, where Robert Walters focuses on hiring for small- and medium-sized businesses, helped it report higher 2016 U.K. profit.
It expanded into Canada, India, the Philippines and Portugal in 2016 and opened new offices in Antwerp, Penang and Toulouse where it had existing operations.
Bannatyne said the company could look at opening a third U.S. office as well as expanding in Latin America, where it has operations in Brazil, in 18 months or so.
($1 = 0.8187 pounds)
(Reporting by Esha Vaish in Bengaluru; Editing by Subhranshu Sahu/Ruth Pitchford)
By Esha Vaish