Randstad Annual Report 2020

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Randstad Annual Report 2020 annual report 2020 #newways. human forward. contents randstad at a glance management report governance financial statements supplementary information contents. randstad at a glance financial statements 4 key figures 2020 144 contents financial statements 6 message from the CEO 145 consolidated financial statements 8 #newways 149 main notes to the consolidated financial statements 10 about randstad 176 notes to the consolidated income statement 16 our global presence 180 notes to the consolidated statement of financial 17 geographic spread position 18 safely back to work alliance 195 notes to the consolidated statement of cash flows management report 198 other notes to the consolidated financial statements 21 how we create value 205 company financial statements 26 integrated reporting framework 207 notes to the company financial statements 28 the world around us 211 other information 34 our strategy and progress 39 our value for clients and talent supplementary information 45 our value for employees 226 ten years of randstad 51 our value for investors 228 tax disclosures 57 our value for society 235 about this report 63 sustainability basics 237 GRI content index 76 performance 241 global compact index 92 risk & opportunity management 242 sustainable development goals 243 memberships and partnerships governance 244 certifications, rankings, and awards 108 executive board 246 highest randstad positions in industry associations 110 supervisory board 247 glossary 112 report of the supervisory board 253 financial calendar 122 remuneration report 254 history timeline 137 corporate governance annual report 2020 2 contents randstad at a glance management report governance financial statements supplementary information randstad at a glance. 4 key figures 2020 6 message from the CEO 8 #newways 10 about randstad 16 our global presence 17 geographic spread 18 safely back to work alliance annual report 2020 3 contents randstad at a glance management report governance financial statements supplementary information key figures 2020. revenue in millions € 20,718 › 78 underlying EBITA margin 3.3% › 78 adjusted net income in millions € 470 › 82 free cash flow in millions global HR services leader number of candidates working (on a daily basis) € 1,132 # 1 568,800 › 78 › 78 › 76 number of permanent proposed dividend employee engagement placements per ordinary share score 202,800 € 3.24 7.9 › 76 › 54 › 50 women in senior number of candidates number of employees leadership positions trained trained 51% 313,600 32,000 › 46 › 57 › 65 annual report 2020 4 contents randstad at a glance management report governance financial statements supplementary information key financials. in millions of €, unless otherwise indicated 2020 2019 Δ Underlying1 Revenue 20,718 23,676 (12%) Gross profit 3,970 4,726 (16%) EBITA2 692 1,094 (36%) Actual Revenue 20,718 23,676 (12%) Gross profit 3,948 4,705 (16%) EBITA2 579 977 (41%) Net income 304 606 (50%) Free cash flow3 1,132 915 24% Net debt, excluding lease liabilities4 (333) 756 Net debt, including lease liabilities 255 1,377 Leverage ratio (net debt/12-month EBITDA) 0.3 1.0 Total equity 4,669 4,473 4% Ratios (in % of revenue) Underlying1 Gross margin 19.2% 20.0% EBITA margin 3.3% 4.6% Actual Gross margin 19.1% 19.9% EBITA margin 2.8% 4.1% Net income margin 1.5% 2.6% Share data Basic earnings per ordinary share (in €) 1.62 3.24 (50%) Basic earnings per ordinary share, underlying (in €)5 2.57 4.18 (39%) Diluted earnings per ordinary share, underlying (in €)5 2.55 4.17 (39%) Dividend per ordinary share (in €) 3.24 - - Payout per ordinary share (in %)6 126 - - Closing price, year-end (in €) 53.24 54.44 (2%) Market capitalization, year-end 9,759 9,979 (2%) Enterprise value, year-end7 9,426 10,735 (12%) Employees/outlets Average number of candidates working 568,800 649,000 (12%) Average number of corporate employees 34,680 38,280 (9%) Number of branches, year-end 2,752 2,761 (0%) Number of Inhouse locations, year-end 1,963 2,100 (7%) 1 Underlying: actual gross profit and EBITA adjusted for one-offs, such as restructuring costs, integration costs, and acquisition-related expenses. 2 EBITA: operating profit before amortization and impairment of acquisition-related intangible assets and goodwill. 3 Free cash flow: sum of net cash from operating and investing activities, excluding the acquisition and disposal of subsidiaries and associates and equity investments, and dividends from associates; including repayment of lease liabilities. 4 Net debt, excluding lease liabilities: cash and cash equivalents minus borrowings. 5 Before amortization and impairment of acquisition-related intangible assets and goodwill, integration costs, acquisition-related expenses, and one-offs. 6 Payout per ordinary share in %: dividend per ordinary share on basic earnings per ordinary share adjusted for the net effect of amortization and impairment of acquisition- related intangible assets and goodwill, integration costs, acquisition-related costs, and one-offs. 7 Enterprise value: the total of market capitalization and (net cash)/net debt (net debt excluding lease liabilities). annual report 2020 5 contents randstad at a glance management report governance financial statements supplementary information message from from the CEO. the ‘We are now even more agile, flexible, and committed to getting people back to work and businesses operating at their full potential.’ Dear Stakeholder, digital platforms and environments. At the same time, we were proactive in helping companies adapt to 2020 was a year like no other. When the pandemic hit changing regulations and pandemic-related challenges. the world, our first priority was the health and safety of We supported employers in preparing for the future of our employees and candidates. Within a very short time, work and helping their workforce acquire critical skills. most of our colleagues were working remotely, with full They also turned to Randstad to redeploy talent access to our client and candidate base. We helped tens internally and externally. Our Randstad RiseSmart of thousands who had lost their jobs to find employment business provided compassionate care and career again. We also supported clients to bring their workers transition services to a growing number of employers back on site safely or to new remote locations. Through facing reductions in force in 2020. Our services were all the uncertainty, we provided assurance and practical also instrumental in coaching workers and helping them support. The unprecedented challenges that find new employment. This fits well into our integrated confronted us in 2020, and the lessons we learned, approach to managing people's entire career life cycle helped to further reaffirm our market leadership. We are and helps build longstanding trust. now even more agile, flexible, and committed to getting people back to work and businesses operating at their In 2020, we also celebrated our 60th anniversary. On full potential. September 29, an online interactive show was held in six different time zones around the globe to kick off a whole Although we had embraced digital transformation well range of fun and inspirational Randstad 60 activities for before the pandemic, COVID-19 accelerated the use of all of our employees. annual report 2020 6 contents randstad at a glance management report governance financial statements supplementary information message from the CEO candidates placed in jobs revenue in millions of € 700,000 400,000 25,000 1,142 1,164 20,000 4,929 5,164 990 600,000 300,000 4,732 15,000 5,300 5,305 4,954 500,000 200,000 10,000 12,441 12,043 400,000 100,000 5,000 10,042 0 300,000 0 revenue 2018: revenue 2019: revenue 2020: 2018 2019 2020 € 23,812 € 23,676 € 20,718 temporary placements (average per day) permanent placements (annually) staffing inhouse professionals global businesses Financially, we delivered a solid and competitive We are bringing a laser-sharp focus on talent into 2021. performance in an exceptional year. Trading conditions In a quickly changing world of work, continuous reached a low point in April, when country lockdowns upskilling and reskilling of talent will be critical to avoid were most intensified. Since then, our revenue massive redundancies and skills gaps in the labor recovered gradually month-by-month into December. market. As the global leader in HR services, we will Although our Group revenue was down 12% organically support clients and talent in this regard by launching a year-on-year, we outperformed the market in several key growing range of development and training geographies, such as the US, France, and Belgium. The opportunities. strong operational agility of our highly experienced management teams, our diversified portfolio, and Finally, I am very grateful for having such dedicated and disciplined cost management have all contributed to exceptional people advancing our mission. They were our recovery. As a result, we achieved an EBITA margin the reason for our resilience in 2020 and will also be the of 3.3%, driven by a sound recovery ratio of 44%, and we key to our success in the years ahead. On behalf of the generated a strong free cash flow of € 1,132 million. Executive Board, I want to thank all of our employees, as well as our clients, talent and shareholders, for their On the back of our overall solid performance, and as we continued support and trust. balance the needs of all our stakeholders, we propose to our shareholders a cash dividend of € 3.24 per Best regards, ordinary share for 2020. This consists of a regular floor Jacques van den Broek dividend of € 1.62 and a special cash dividend of € 1.62 per ordinary share. The decision to pay a special dividend over the year 2020 should be seen in connection with our decision to withdraw 2019 dividend proposal in March 2020, which was a precautionary measure.
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