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Adecco Earnings Beat Estimates as CEO Sees Europe Turning

Aug. 8 (Bloomberg) -- Adecco SA, the world’s largest provider of temporary workers, posted a 12 percent increase in second-quarter earnings and signaled signs of a turnaround in Europe. The shares rose to the highest price since March 2011.

Net income rose 12 percent to 126 million euros ($168 million), beating the 112.1 million-euro average estimate of eight analysts in a Bloomberg survey. Organic sales declined 3 percent to 4.9 billion euros, the Glattbrugg, Switzerland-based company said in a statement today.

“Labor markets are starting to stabilize around Europe and we see some more positive signs in our business,” Chief Executive Officer Patrick De Maeseneire said today in a statement. “The steady improvement so far this year is encouraging for the second-half outlook.”

De Maeseneire, the former chief of Barry Callebaut AG who became head of Adecco in 2009, has presided over a share-price rise of about 35 percent this year, as the decline in Europe’s job market slowed. The euro area probably exited recession in the three months through June after a record six quarters of economic contraction, according to a survey of economists compiled by Bloomberg.

Adecco closed 3.74 percent higher at 62.40 euros in Zurich, giving the company a market value of 11.8 billion francs ($12.8 billion).

Halt Declines

Second-quarter revenue fell 12 percent on an organic basis in France, which accounts for about 25 percent of group sales. In Iberia revenue declined by 2 percent while in Germany, Austria and Italy sales were flat on the same quarter a year earlier, Adecco said.

Monthly sales will stop declining in the second-half compared with the same period a year earlier, “let’s say after the summer between September and December,” De Maeseneire said in a phone interview today.

Adecco and Randstad Holding NV said July 11 they’re among temporary-staffing companies that are being probed by French regulators investigating whether they infringed competition rules. Adecco is fully cooperating with regulators, the company reiterated today.

To contact the reporter on this story: Patrick Winters in Zurich at pwinters3@bloomberg.net

To contact the editor responsible for this story: Tim Farrand at tfarrand@bloomberg.net

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