RECRUITMENT group Workforce Holdings has set itself up to manage South Africa’s labour laws when they are amended, and to grow its earnings despite difficult trading conditions, according to CEO Lawrence Diamond.
The company on Tuesday reported that its headline earnings per share increased 22% to 3.9c per share in the six months to June. Revenue rose 14% to R718m. The company’s net asset value per share climbed to 91c per share.
"The results are pleasing given very competitive market conditions. I think our edge is that we focused on outsourcing, while our competitors moved away from it. It is our core business and it has done well over the last few years," Mr Diamond said.
However, he said the company had also invested in its diversified complementary businesses.
"These are businesses such as those related to employee lifestyle benefits, which have been in the pipeline for a while," he said.
The group’s staffing and recruitment segment performed well and material progress was made in white-collar specialist recruitment divisions.
"This, we believe, is being driven predominantly by a shortage of skills, particularly in the engineering, trades and information technology sectors," Mr Diamond said.
The company has said over the past two years that it has been watching pending amendments to South Africa’s labour legislation.
Initially, recruitment companies were concerned the amendments would curtail the number of people temporarily employed in South Africa. This would dent the profits of many of their temporary work-based divisions.
But recent discussions of the bills in Parliament have suggested they will not bring severe changes to how temporary employment is governed by law.
"We are watching the bills very closely. We understand labour broking won’t be banned. There will be greater complexity in the legislation, but complexity brings opportunities. We will have to be flexible," Mr Diamond said.
Business commentator Johnny Goldberg said: "The bills are being watered down."
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