Recruitment firm Norman Broadbent struggled with “extremely challenging” market conditions in the first half but is still on the look out for acquisition opportunities.
Net fee income in the first half is expected to be £4.5m, down 14 per cent on last year but up 36 per cent on the year before.
The largest contribution to the drop-off in fees was falling searches for interim management positions, which was down 47 per cent year-on-year. Executive searches were down four per cent on last year.
Norman Broadbent reported that the number of search mandates it had secured was up five per cent on last year, but that fee value per mandate was down nine per cent reflecting “industry-wide trends”.
Underlying earnings before interest, taxation, depreciation and amortisation (EBITDA) is expected to be between £100,000 and £150,000 compared to £270,000 last year, it said.
Shares in the firm were down over five per cent in early trade.
Kevin David, the firm’s chief executive, said: “”Growth is rarely linear quarter to quarter, but there is no doubt that, as is the case across the entire executive search and staffing industries, we are navigating extremely challenging market conditions”.
“However, this doesn’t impact the confidence we have in our prospects. Therefore, while having been cost conscious in H1 2024, we have continued to invest, growing and upgrading headcount to ensure that the Company is well positioned to capitalise on the recovery when it comes,” he continued.
David said the firm was “actively exploring synergistic acquisition opportunities” and remained confident of meeting the Norma Broadbent’s medium term targets.
“With high levels of staff retention, general economic confidence beginning to return, inflation seemingly under control and an overall expectation of an improvement in market conditions in H2 2024, we remain confident in our ability to deliver on our target of £1.25 million EBITDA by 2025,” he said.