HRnetGroup Q2 profit falls 11.5% on lower staffing and contract margins

HRNETGROUP on Tuesday posted a 11.5 per cent fall in net profit to S$11.5 million for the second quarter, from S$13 million a year ago on the back of lower margins from flexible staffing.

Gross profits were slightly lower mainly due to the inclusion of government contracts which carry lower margins, the mainboard-listed recruitment firm said.

For the three months ended June 30, earnings per share was 1.14 Singapore cents versus 1.29 cents a year ago. The company's shares closed up one Singapore cent or 1.5 per cent at S$0.675 on Thursday, before the long holiday weekend.

Revenue rose 0.5 per cent to S$108.5 million from S$108 million a year ago.

No dividend was declared for the quarter, same as a year ago.

For the first half of 2019, net profit was 5.2 per cent higher at S$30.8 million compared with S$29.3 million a year ago. Revenue dipped 1.2 per cent to S$212.5 million versus S$215 million.

"The continuing uncertainty over the trade disputes has led to muted hiring particularly in Singapore. We are pushing ahead with the flexible staffing business which performs the role of a natural hedge in times of volatility," said Adeline Sim, executive director of HRnetGroup.

"We will also continue to capitalise on growth opportunities across product offerings and geography."