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UPDATE 2-Switzerland's Adecco sees steady recovery as COVID restrictions ease

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John Revill
·2 min read
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* Company sees steady improvement at start of 2021

* CFO sees further recovery when restrictions lifted

* First-quarter revenues likely to be flat

* Company resumes 600 million euros share buyback (Updates with share price, analyst and executive comment)

By John Revill

ZURICH, Feb 25 (Reuters) - Adecco Group is seeing a steady recovery in the employment market and does not expect the improvement to be derailed by the latest COVID-19 restrictions across Europe, the Swiss staffing company said on Thursday.

Adecco said many employers had learned to cope with social distancing rules and other restrictions, while it expected measures to tackle the latest COVID-19 surge to be eased.

The company, whose operations help signal the health of the broader economy, said its revenues in January and February had almost returned to pre-crisis levels helped by increased hiring in booming areas like ecommerce and logistics.

"The risk of it going backwards is limited," Chief Financial Officer Coram Williams told Reuters. "We are clearly at the point where the restrictions have been at their strictest and volumes have been resilient. We should see further recovery and improvement but only when those restrictions are really lifted."

Switzerland said on Wednesday it would ease restrictions from March 1 and Britain has set out a plan to relax measures, although shops, restaurants and schools are still shuttered in many European countries.

In both January and February, Adecco saw revenues decline 2% compared with a year earlier, an improving trend from the 5% fall in the fourth quarter and 15% drop in the third quarter.

"We are a good barometer of the economy and we are close to pre-crisis levels if you look at our revenues," Williams said.

Adecco's renewed confidence echoes rivals Randstad and ManpowerGroup which both said they were seeing steady improvements in hiring.

During its fourth quarter, Adecco's revenues fell to 5.41 billion euros ($6.59 billion), beating the estimate for 5.27 billion euros in a company-gathered consensus of analyst views.

Fourth-quarter net profit of 149 million euros beat forecasts for 116 million euros. Shares rose 1.6% in early trading.

Williams said Adecco expected to post revenue growth during its second quarter this year after a 28% plunge in the COVID-hit second quarter of 2020.

Revenue would likely be flat in the first quarter with "a small possibility of growth," Williams said.

The company proposed a 2020 dividend of 2.50 Swiss francs, the same level as for 2019, and said it would resume its 600 million euro share buyback scheme it paused at the start of the crisis.

($1 = 0.8214 euros) (Reporting by John Revill; Editing by Michael Shields and Edmund Blair)