LONDON - TelAve -- Recruitment giant Hays plc has announced a sharp cut to shareholder dividends after reporting a dramatic fall in profits, underscoring the ongoing challenges facing the global recruitment industry.

The group's pre-tax profit for the year ended June 2025 fell 90% to £1.5 million, down from £14.7 million the year before. Revenue pressures also weighed heavily, with net fee income sliding 13% to £972.4 million. The decline reflects weaker hiring activity across both permanent and temporary markets, particularly in Europe and Asia.

As a result, the company said it would reduce its final dividend by 86% to 0.29p per share, bringing the full-year payout to 1.24p, compared with 3.00p last year. The final dividend is scheduled for payment on 26 November 2025 to shareholders on the register by 17 October 2025.

Workforce Cuts and Cost Savings

In addition to the dividend reduction, Hays has undertaken a major restructuring programme, reducing its global workforce from 13,500 to around 9,500 employees. The company has already achieved £35 million in annualised cost savings, and management has outlined plans to deliver a further £45 million in savings by 2029 through efficiency initiatives and greater use of technology.

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Market Reaction

The market response to the announcement was swift, with Hays' shares falling more than 5% in early London trading. Analysts pointed to the dividend cut as a necessary but painful step, signalling management's cautious outlook for the year ahead.

Despite the weak results, Hays stressed that its balance sheet remains solid and the group continues to generate cash. The company said it will prioritise selective investment in high-demand sectors, such as technology, life sciences, and sustainability-related roles.

Wider Industry Challenges

The challenges facing Hays are not unique. Competitors such as PageGroup and Robert Walters have also reported falling earnings in recent months, reflecting softer client demand and greater caution in permanent recruitment. Hays' decision to aggressively cut costs and preserve cash mirrors moves across the sector, as firms position themselves to weather prolonged economic headwinds.

Outlook

Looking ahead, management at Hays said the business remains focused on improving efficiency and leveraging its technology platforms to enhance productivity. While the near-term environment remains difficult, the company is positioning itself to benefit from a rebound in hiring confidence once market conditions stabilise.

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About Us: Better Headhunting (https://betterheadhunting.com/) is an independent news and insights platform covering executive search, recruitment, and talent strategy. Read the full analysis at https://betterheadhunting.com/2025/08/hays-cuts-dividend-by-59-after-90-profit-drop/