Adecco Declines as Management Changes Raise Transition Concern

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Adecco SA shares fell as much as 6.4 percent after the world’s largest provider of temporary workers said its chief executive officer and head of finance plan to leave the company, raising concern the management transition may affect profit growth.

Alain Dehaze, the 51-year-old head of Adecco’s business in France, which is its largest source of revenue, will replace Chief Executive Officer Patrick De Maeseneire on Sept. 1, the company said Thursday. Chief Financial Officer Dominik De Daniel will leave the company, and a replacement will be named in coming months.

The departures will “create a vacuum and a period of uncertainty,” Michael Foeth, an analyst at Bank Vontobel, wrote in a note. He has a hold recommendation on the stock.

De Maeseneire took up his post in 2009 and steered the company through economic turmoil in Europe. The family of late billionaire Klaus Jacobs, the company’s founder, reduced its stake in Adecco last year. De Maeseneire previously was CEO of Barry Callebaut AG, a chocolate maker the family controls.

Stock Drops

The stock traded 6.2 percent lower at 70.05 francs at 10:24 a.m. in Zurich. Adecco has risen 8.5 percent this year, the second-best performance on the benchmark Swiss Market Index, which has declined 0.8 percent in the period.

Separately, first-quarter net income rose 45 percent to 160 million euros ($182 million), Adecco said. Analysts expected 142.2 million euros, according to the average of estimates compiled by Bloomberg. Earnings before interest, taxes and amortization rose 31 percent to 236 million euros.

Adecco is a bellwether for the global economy as companies use recruitment services to bring in temporary staff when business prospects are rising.

“It is my decision and it was my intention to leave closer to the end of the year,” De Maeseneire said in a conference call with reporters, adding that there was no dissent over strategy with the board. “Sometimes you need to close the door.”

Adecco reiterated a forecast that the Ebita margin will exceed 5.5 percent of sales this year.

“We are absolutely convinced to reach this target,” the CEO said.

The appointment of Dehaze is a natural fit, according to Marc Zwartsenburg, an analyst at ING.

“The departure of both CEO De Maeseneire and CFO De Daniel we see as a big loss for Adecco and might weigh on the shares today,” he said.

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