PageGroup has recorded a 4.9% drop in its gross profit year-on-year to £187m, citing subdued levels of client and candidate confidence.

The recruitment firm saw its UK gross profit drop by 11.4% to £20.9m, as a result of tough market conditions across the country. Furthermore, profit in its EMEA division also fell by 9.2% to £100.4m.

Despite this, in its Asia Pacific and the America, gross profit increased by 9.3% and 1.1% respectively.

Furthermore, its net debt totalled £7m, which is in line with expectations due o usual Q1 outflows for quarterly and annual bonuses.

However, PageGroup has stated that the conflict in the Middle East is driving an "increasingly uncertain outlook" for the rest of the year.

Despite this, its share price increased by just over 2%.

Chief executive officer at PageGroup, Nicholas Kirk, stated: "Overall, our focus remains on balancing near-term productivity, which grew 2% in Q1, with ensuring we are well placed to take advantage of opportunities as market conditions improve.

"Whilst we have seen signs of a normalisation in trading in some of our markets, the increased geopolitical and macro-economic risks due to the conflict in the Middle East create a heightened degree of uncertainty in the outlook for the rest of the year.

"Despite this market outlook, we continue to focus on controlling the controllables, invest in innovation and technology, and remain confident in the execution of our strategy. We have a highly diversified and adaptable business model, a strong balance sheet and a cost base that is under continuous review."

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