UPDATE 3-Brunel H1 misses estimates on costs, shares slump

* H1 net profit 11.4 mln euros vs 15.5 mln poll average

* H1 sales 334.9 mln euros vs 343 mln expected
* Expects strong profitable growth in H2 in some units

* Shares touch eight-month low, down 11.1 pct

(Adds CEO comments, updates shares)

By Gilbert Kreijger

AMSTERDAM, Aug 20 (BestGrowthStock) – Dutch staffing firm Brunel’s
(BRUN.AS: ) first-half earnings missed even the most pessimistic
forecasts on Friday as costs swelled at its energy unit and the
economic slump continued to bite.

Shares in Brunel, which generates more than half its sales
from providing workers to the oil and gas industry, initially
slumped to an almost eight-month low at 19.90 euros, but
recovered slightly during morning trade.

The stock was down 11.1 percent by 0918 GMT to 21 euros
versus a 1.2 percent dip in the Dutch small cap index (.ASCX: ).

Brunel said overhead costs at its energy unit increased due
to investments to support future growth. The group’s operating
profit margin fell to 4.8 percent in the January-to-June period
from 6.3 percent a year ago.

High costs at the energy unit took analysts by surprise.

“I expect to slightly adjust my earnings forecast. Not in a
drastic way, about 5 to 7 percent or 10 euro cents per share,”
AEK analyst Martin Crum said.

Staffing firms such as Dutch rival Randstad (RAND.AS: ) and
Switzerland’s Adecco (ADEN.VX: ) have been cutting costs to cope
with the downturn and its aftermath, which weighed on temporary
hiring until the end of 2009 in most European markets.


Brunel’s energy unit costs were made for reorganisation, new
management, a new global administration system and a front
office system, Brunel Chief Executive Jan Arie van Barneveld
told Reuters.

When asked whether costs for the administration and front
office system could continue, he said: “Yes, I think so,
certainly. Perhaps also next year. But that is not terribly
important. We see that energy’s sales will grow from the fourth

He declined to specify how high the continued costs would
be, but said about 1 million euros of costs would not reoccur.

Brunel’s net profit and sales fell 34 percent and 9 percent
to 11.4 million euros and 334.9 million euros respectively,
missing even the lowest forecasts of analysts polled by Reuters.

The ending of a large project in 2009 and the economic
downturn in the Netherlands and Germany also weighed on Brunel’s
results, although it expected improvements, the company said.

“We expect for Germany and Energy strong profitable growth
during the second half and fourth quarter of 2010 respectively.
For the Netherlands only a limited growth is foreseen for the
remainder of this year,” Brunel said.
($1=.7791 Euro)
(Editing by Michael Shields and Jon Loades-Carter)

UPDATE 3-Brunel H1 misses estimates on costs, shares slump