1
program
Thursday
November 20, 2014
13:00
Subject
Randstad Group Strategy
Jacques van den Broek, CEO
13:45
Financial Strategy
Robert Jan van de Kraats, CFO
14:30
15:00
Coffee break
Profitable growth in The Netherlands
Chris Heutink, Executive Board member
15:40
Winning in US Staffing
Traci Fiatte, President, Randstad General Staffing USA
16:20
How does Technology affect our business?
Reiant Mulder, Operations Director
16:50
Randstad Innovation Fund
Ilonka Jankovich & Paul Jacquin, Managing Partners
17:20
Wrap-up
Jacques van den Broek, CEO
2
17:30
Drinks and appetizers
18:30
End of event
November 20, 2014
Capital Markets Day 2014
Capital Markets Day
Jacques van den Broek, CEO
Capital Markets Day
London
Randstad Holding nv
November 20, 2014
disclaimer & definitions
Certain statements in this document concern prognoses about the future financial condition,
risks, investment plans, productivity and the results of operations of Randstad Holding and
its operating companies as well as certain trends, plans and objectives. Obviously, such
prognoses involve risks and a degree of uncertainty since they concern future events and
depend on circumstances that will apply then. Many factors may contribute to the actual
results and developments differing from the prognoses made in this document. These
factors include, but are not limited to, general economic conditions, a shortage on the job
market, changes in the demand for (flexible) personnel, achievement of cost savings,
changes in the business mix, changes in legislation (particularly in relation to employment,
staffing and tax laws), the role of industry regulators, future currency and interest
fluctuations, our ability to identify relevant risks and mitigate their impact, the availability of
credit on financially acceptable terms, the successful completion of company acquisitions
and their subsequent integration, successful disposals of companies and the rate of
technological developments. These prognoses therefore apply only on the date on which
this document was compiled.
-------------------------------------------------------------------------------------------------------------EBITA: operating profit before amortization and impairment acquisition-related intangible
assets and goodwill, badwill, integration costs and one-offs.
organic growth is measured excluding the impact of currency effects, acquisitions,
disposals and reclassifications.
diluted EPS is measured before amortization and impairment acquisition-related intangible
assets and goodwill, badwill, integration costs and one-offs.
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November 20, 2014
Capital Markets Day 2014
agenda
evolution
our strategy
Total Talent Architecture (TTA)
business segments
Activity-Based Field Steering (ABFS)
conclusion
5
Capital Markets Day 2014
Randstad: 10 year evolution
diversified portfolio and track record of improving profitability
2003
2013
GP of € 3.0 Bln
GP of € 1.1 Bln
Staffing & HRS, exc. Perm
Inhouse
Professionals
Perm Staffing
EBITA of 3.5%, higher by 50%
EBITA of 2.3%
Staf + HRS
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November 20, 2014
IH
Profs
Capital Markets Day 2014
Staf + HRS
IH
Profs
our services offering has evolved accordingly
freelancer
solutions
we review trends constantly and manage on actuals, driving sustainable business improvements
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Capital Markets Day 2014
structural changes
the world is undergoing fundamental structural shifts
globalization/demographics
• increasing skills mismatches and migration flows
• clients looking for fewer suppliers within and across
countries
• industry shortages & surpluses differ per sector and
profile type
flexibility
• more labor market flexibility is needed to enhance
competitiveness and adapt to change: invest in work
security
(de)regulation
• combat union/government strategy to limit flexibility
by introduction limitations and conditions
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Capital Markets Day 2014
our strategy
Randstad core values: to know, serve and trust, striving for perfection and the
simultaneous promotion of all interests
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Capital Markets Day 2014
strategic roadmap
driven by best people, strong concepts, excellent execution and superior brands
M&A
Tech
TTA
goals
M&A, seamless fit
integrations
• strategic fit
• value creation
• manageability
HR technology
being the most agile integrator of
technology & services in our industry
•
Randstad innovation fund
capturing trends & future
business in HR technology
•
Org
Total Talent Architecture, World Class Customer Experience
• creating quantifiable business impact addressing the entire
workforce of our clients
ABFS
World League People, at the right place, at the right time
• optimized organization structure
• high performance culture & people engagement
• continuous process improvement
Activity-based Field Steering
• driving commercial excellence;
brand strength, leads and conversion
today
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November 20, 2014
Capital Markets Day 2014
shape the world of work
• optimal workforces for
clients
• the best jobs for
candidates
grow to 5-6% EBITA
profitable growth
improve margin
increase productivity
•
•
•
Total Talent
Architecture (TTA)
Capital Markets Day
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Capital Markets Day 2014
TTA: creating quantifiable business impact across
the entire workforce
“We know you, we know your company, we know your
sector and we can help you become a better company
with a better output of your people with more efficient
HR processes. We’ve compared you against the
benchmarks. We can show you where we did it, would it
be interesting to talk further with us on this?”
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November 20, 2014
Capital Markets Day 2014
TTA is the way to execute our ambition
define issues
create action
plan
identify
stakeholders
problem
solution
turn into
bold
statements
assemble
facts &
figures
translate
into
compelling
messages
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November 20, 2014
Capital Markets Day 2014
proof
roadmap to business impact
degree of agility
and
sustainability
total talent
architecture
engagement
models
total cost of
ownership
preferred
suppliers
•
•
•
ad-hoc
•
•
•
consolidated
compliance
aims to control
and save costs
•
•
•
•
transparency
longer term view
process efficiencies
aims to lower total
costs
•
•
•
•
•
MSP
RPO
SSC
process
improvement
aims to add value
•
•
•
•
•
•
strategic planning
includes all workforces
holistic approach
global & local optimization
applied innovations
aims for industry leadership
diversified
single categories
aims to meet
local needs
bottom line impact
top line and bottom line impact
degree of business impact
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November 20, 2014
Capital Markets Day 2014
TTA: connecting our business
EB
Opco MD
Total Talent Architecture
Staffing
In
house
MSP &
RPO
Profs
nontech
Profs
tech
Marketing, HR, BCD - concept specific
Support SSC (Finance, IT, Legal, Facilities etc.)
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Capital Markets Day 2014
business segments
Capital Markets Day
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Capital Markets Day 2014
Capital Markets Day 2014
Staffing: adapting delivery models to customer needs
Revenue
EBITA%
4,000
Inhouse Rev (€ B)
3,500
share of total
revenue
20.8%
19.5%
20%
17.9%
3,000
14.1%
11.1%11.0%
4,2%
15.0%
15%
1,000
3.1
7.0%
1.9
1.5
0.7
10%
4,0%
3,5%
3,7%
3,4%
5%
2,5%
1.3
0.9
--
0%
2,0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 L12m
17
4,0%
3,0%
2.0
1.9
4,3%
3,3%
2.6
5.4%
500
3.2
3.5
4,7%
Staffing
4,0%
3,8%
10.6%
9.1%
1,500
Inhouse
4,5%
2,500
2,000
5,0%
5,0%
November 20, 2014
Capital Markets Day 2014
2010
2011
2012
2013
L12M
Professionals: growth is picking up
ABFS and people in place, ready to grow further
100
10%
80
60
5%
40
20
0%
0
Q2 14
Q1 14
Q3 14
-20
-5%
-40
-60
-10%
-80
EBITA Δ (RHS)
GP Growth
Q3 2014
Q3 2013
% organic*
revenue
877.3
837.9
4%
EBITA
47.9
39.3
23%
EBITA margin
5.5%
4.7%
Professionals in € M
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Capital Markets Day 2014
growth led by Belgium, NL, Iberia,
Poland and emerging markets
improving profitability trend in
main markets
perm +12%
Professionals remains a big opportunity
market will continue to grow structurally faster than staffing
Global Clients
~25% of group sales
Total global market
2013 (€ bln)
Total
Staffing
professionals
Market
310
215
95
Randstad
16.8
13.5
3.3
Market share
5.4%
6.3%
3.5%
Staffing
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November 20, 2014
Capital Markets Day 2014
Professionals
Professionals: what is the way forward?
getting our act together, structurally driving forward from here
Anglo Saxon markets: further expanding vertical strategy
(IT, Finance, Engineering etc.)
management changes in US profs, UK and Australia happened
North Europe: vertical approach is being implemented
e.g., the Dutch professionals operation
Emerging/Embryonic markets: focus on growth/market share
China is the example where high growth (>50% in Q3) goes
hand in hand with a good productivity. India should follow
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November 20, 2014
Capital Markets Day 2014
Perm: fast growing, but a long way to go
90%
80%
70%
60%
Perm as a % of GP
embryonic/developing markets
China
100%
primarily established temp markets
20%
10%
US Staffing
30%
Group
UK
40%
AUS
50%
0%
Perm now makes up 10% of group GP (was ~12% in 2007)
Perm grew 15% in Q3 and continues to accelerate in Q4
in established markets we have the potential to double (predominantly
across North Europe)
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Capital Markets Day 2014
Sourceright strengthening in Europe
with expertise in recruitment process outsourcing RPO, managed services
programs MSP, blended workforce solutions, and payrolling & independent
contractor solutions
Staffing
Professionals
Sourceright
more than a third of RPO deals signed in Europe are multi-country
solutions (frequency increasing) – physical presence in 22 European
countries (delivery capabilites in every country)
the RPO & MSP market will grow around 20% year on year (aim for
above market growth by incorporating TTA)
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Capital Markets Day 2014
MSP: spend under management up 35%
23
North America
UK
November 20, 2014
Capital Markets Day 2014
EMEA
2014
L4Q
2013
2012
2014
L4Q
2013
2012
2014
L4Q
2013
2012
EMEA is next after rapid adaptation in Anglo Saxon markets
Activity-Based Field
Steering (ABFS)
Capital Markets Day
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Capital Markets Day 2014
Capital Markets Day 2014
ABFS for all services
Organizational Readiness
ABFS alignment for all actual and future services
services
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Capital Markets Day 2014
ABFS is part of our growth readiness framework
invest, manage, divest
1
26
Is the organization ready to grow?
2
Is the business performance positive?
3
Do consultants follow the growth path?
organizational
readiness
business
performance
existing producer
population
(per vertical per country)
(vertical and branch level)
(individual producers per branch)
Activity-based field
steering in place
Profitability
(conversion ratio)
Headcount Productivity
(distribution vs average)
Onboarding program
Revenue/GP Growth
Consultant Capacity
(# of activities)
Role of Management
Order Pipeline
(Customers, Orders,
Candidates)
Operational effectiveness
(ratios)
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Capital Markets Day 2014
activity matrix – which actions to take?
at target activity level
at target GP/FTE
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November 20, 2014
coach closely on
focus/conversion
well-performers,
prepare for
investment
increase activities
further growth by
driving activities
Capital Markets Day 2014
what has ABFS brought us so far?
a cumulative 29% increase of the activity levels
activities vs. last year
wk20
wk21
wk22
wk23
wk24
wk25
wk26
wk27
wk28
wk29
wk30
wk31
wk32
wk33
wk34
wk35
wk36
wk37
wk38
wk39
wk40
wk41
wk42
wk43
190%
170%
150%
130%
110%
90%
70%
50%
May
June
July
calls vs. LY
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November 20, 2014
August
visits vs. LY
Capital Markets Day 2014
September
October
what has ABFS brought us so far (II)?
yoy growth %
productivity trends
(yoy growth for GP and PE field)
8%
6%
4%
2%
0%
-2%
-4%
-6%
-8%
Q1
Q2
Q3
Q4
Q1
Q2
2012
Q3
Q4
2013
growth GP (normalized for wd)
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Capital Markets Day 2014
Q2
2014
growth PE field
an improved productivity of our field staff
29
Q1
Q3
conclusion: where do we see structural growth
opportunities and room for improvement?
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November 20, 2014
Capital Markets Day 2014