A big profit warning on 14 June from Hays’ (HAS) rival Robert Walters (RWA) has created nervousness ahead of the former’s fourth quarter and full-year trading update on 13 July.

The recruitment space is often a bellwether for the wider economy and, with economic clouds gathering, the portents are not too promising.

This is despite April’s solid third quarter update from Hays, with the company seeing strong demand for temporary staff and pointing to second-half operating profit ‘modestly above’ the first half with the proviso that activity levels remained stable in the three-month period to 30 June.

Hays also faces the uncertainty of a transition to a new chief executive as Alistair Cox prepares to step down after 15 years in the role. Investors will be looking for an update on the process of finding his replacement.

Cox has successfully diversified Hays into new geographies and markets over the course of his tenure and this could stand the company in good stead to withstand volatility in the labour market.

As Liberum observes: ‘Hays is building an increasingly resilient model, diversifying into higher growth (for example, tech) and higher margin (diversity, equity and inclusion) segments.

‘There is a clear longer-term strategy in place to double earnings before interest and tax to more than £400 million by 2027, assuming a supportive market backdrop. The strong balance sheet supports attractive cash returns even in more difficult markets.’

UK UPDATES OVER THE NEXT 7 DAYS

FULL-YEAR RESULTS

July 11: Begbies Traynor Group, D4T4 Solutions, Trifast

July 12: Loungers, Carclo, Ashmore Group, Renold

July 13: DSW Capital, IIika

HALF-YEAR RESULTS

July 11: Synectics

July 13: MusicMagpie

TRADING ANNOUNCEMENTS

July 10: MJ Gleeson

July 11: Vistry

July 12: Tullow Oil, Ten Entertainment

July 13: Experian, Barratt Developments, Hays

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