Executive Summary

•Hays achieve significant growth in EPS allowing them to consistently deliver a 15% growth in dividend.

•It is becoming increasingly difficult to maintain the growth as increased competition puts earnings under pressure.

•Competitive advantage being eroded in traditional distribution

•Hays need to move along the value chain to provide higher added value services to maintain competitive advantage

•This will be achieved through the disposal of non core low value, low growth businesses and the acquisition of high value consultancy practices.

•Distribution and BPO will be combined into a ISCM/BPO division.

•New knowledge based acquisitions (IT/SCM Consultancies) will be used as support functions to ISCM projects and stand alone BPO projects.

Hays have consistently achieved growth in earnings per share well in excess of a steady 15% growth in dividend. In it’s sector, Hays has outperformed it’s competitors and has been the darling of the stock market with return on net capital employed in excess of 33% for each of the previous 4 years.

However, it is becoming increasingly difficult for Hays to maintain this level of growth and return of investment, margins and earnings have been put under increasing competitive pressure.

Hays’ competitive advantage has been eroded as others have entered this increasingly crowded sector.

Hays needs to move both up and down the value chain, integrating it’s offering to provide increased added value services to it’s customers.

Distribution and Business Process Outsourcing should be combined into a single division, a number of synergies exist.

Hays should also accelerate the number and size of knowledge based acquisitions in the Information Technology and Supply Chain Management sector.

Further information, business plan, strategy and implementation plan, available from; paul@paulbrianblack.com

Contents

Executive Summary