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Adecco sees profit soar but remains cautious

Adecco says it is not seeing signs of job creation Keystone Archive

Adecco, the world’s top employment services firm, has exceeded analysts’ expectations by posting a 30 per cent rise in third-quarter net profit.

This content was published on October 22, 2003 - 17:23

But the Swiss-based company, which is seen as a leading economic indicator, said it remained cautious in its outlook for the jobs market.

Adecco reported net income of €104 million (SFr162 million), while operating income before amortisation rose 19 per cent to €163 million.

Sales fell three per cent to €4.25 billion, but rose two per cent in constant currencies.

Adecco shares have risen by more than 40 per cent this year, outstripping its big rival Manpower, with investors attracted by the firm’s cost-cutting strategy and the conviction that it will benefit from an economic upturn.

“The economic environment remains challenging but we are pleased to have achieved the return to positive [constant currency] sales growth,” said Adecco chief executive Jerome Caille.

“We have also maintained our focus on reducing operating costs.”

Adecco slashed costs and cut 2,000 jobs in the first half.

Logitech

The Swiss-registered computer peripherals manufacturer, Logitech, took the markets by surprise on Wednesday by reporting a 17 per cent increase in sales to $294 million (SFr390 million) for the second quarter.

Cost-cutting measures and aggressive marketing activities helped drive up operating income for the world’s largest producer of computer mice to $27.4 million - up from $25.7 million last year.

“With overall improving economic conditions and positive news out of the technology sector, we believe that Logitech can move above the pre-profit warning level of around SFr56 [per share],” Christoph Ladner, an analyst for Bank Sarasin said.

Logitech, which also makes keyboards and webcams, stuck with its 2003/4 forecast for sales of around $1.21 billion and operating income of around $142 million.

Syngenta

The world’s top agrochemicals producer, Syngenta, announced higher-than-expected third-quarter sales despite the recession in farming.

The Basel-based company said it had benefited from the continuing weakness of the dollar.

Syngenta said sales of crop chemicals rose seven per cent to $1.17 billion (SFr1.56 billion), boosting the share price.

Chief financial officer Domenico Scala said he expected full-year sales to grow at a similar rate to the first nine months.

He declined to give a sales forecast for 2004, explaining that Syngenta’s ability to achieve its targets depended on an upturn in the farm market.

Sulzer

The engineering group Sulzer announced that new orders in the first nine months of 2003 rose by one per cent to SFr1.5 billion ($1.1 billion).

It added that it expected the market to stabilise and that order intake for the entire year would exceed last year's levels.

Sulzer did not release any detailed figures for the first three quarters of this year.

swissinfo with agencies

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