Financial press Release

Q1 2002 Adecco sees first signs of improvement in Europe and North America

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Q1 2002 Adecco sees first signs of improvement in Europe and North America

Results for the first quarter ended March 31, 2002 in line with expectations



Highlights:



Revenues of CHF 6.0 billion, down 11% in CHF and 9% in local currency



Operating income of CHF 186 million, down 32% in CHF and 31% in local currency



Income before amortisation of intangibles and one-time items of CHF 101 million, down 38% in CHF and 36% in local currency



First signs of recovery - diminishing volume decline year over year in February and March, in particular in the USA and in the UK IT sector



Career Services, e-Business & Others division with continuing strong results



Jobpilot acquisition heading towards completion on schedule





CHESEREX, SWITZERLAND, April 17, 2002



Adecco SA, the worldwide leader in HR solutions, announced today its results for the first quarter ended March 31, 2002. The company reported revenues of CHF 6.0 billion, down 11% on last year's first quarter, and operating income of CHF 186 million, down 32% on first quarter 2001. In local currency, revenues were down 9% with an operating income decline of 31%, indicating a slightly unfavorable currency fluctuation impact on Adecco's consolidated results. The company reported income before amortisation of intangibles and one-time items of CHF 101 million, down 38% on last year's figures (36% decline in local currency).



"As expected this has been a difficult quarter, but we are very pleased that the declines in both sales and profits were similar to the fourth quarter 2001 level. This suggests that we have reached the low point of the economic downturn" said John Bowmer, Adecco's CEO. "We expanded our branch network in the first quarter and may build it further if the encouraging signs of improvement in North America and in Europe prove to be sustainable. The Ajilon division also saw some positive signs with substantially higher new contract wins in March compared to end of last year. Career Services remains a strong counter-cyclical business. Since, in recent weeks, sales are down less year over year in North America and in much of Europe, we feel confident that the worst of the downturn is past. We do however expect that the 2nd quarter will still be difficult, as we will compare the next quarter against a strong 2001 performance."





Divisional Performance



Adecco Staffing revenues were down 9%, a 7% drop in local currency. Profits were depressed in most regions, particularly in North America, where the decline in profits reflected a sharp drop in permanent placement.



Ajilon Staffing & Managed Services posted a revenue decline of 26%, both in CHF and local currency. These results reflect the continuing weakness of permanent placement, especially in Accounting and Finance.



Career Services, e-Business & Others reported 50% revenue growth in CHF, a 49% increase in local currency. The division continued to benefit from the counter-cyclical effects of Outplacement, mitigating the drops in revenues and profits in other divisions.



"Economically difficult times offer great opportunities in particular for the leaders," said Jérôme Caille, appointed CEO of Adecco. "We are determined to capture this opportunity, roll out our proven organic growth approach and strengthen our market position. Aggressive sales efforts are starting to bring results in some areas, such as Adecco Benelux, where we have clearly outperformed competition and gained further market share. We have recently won new customers and now serve as many clients as in March 2001. Today, the key ingredients to gain share in the upturn are in place: A strong client base, an outstanding, new leadership team with high aspirations, and excellent systems to serve clients and associates best. These elements combined make me feel confident of the future success of Adecco".



Outlook



In line with economists in the USA and Europe, Management remains confident that macroeconomic signs point towards a recovery in 2002. Although it continues to be difficult to predict the exact time frame for the recovery to take place, Management feels confident that this recovery could take place in the second half of 2002.



jobpilot AG Acquisition Update



On February 6, Adecco SA announced a recommended cash offer to acquire all of the issued and outstanding share capital of jobpilot AG, which would create a leading European online staffing, recruiting and service company by combining jobpilot's internet platform with the physical assets of Adecco.



The process for the acquisition of jobpilot AG is progressing according to schedule. The deal is now pending regula-tory review in two of the four required markets.



US GAAP Results



For the three months ended March 31, 2002, Adecco reported under US Generally Accepted Accounting Princi-ples (US GAAP) revenues of CHF 6.0 billion and a net income of CHF 100 million, including CHF 1 million amor-tisation of other intangibles.



According to Chief Financial Officer, Felix Weber, "Adecco continues to consider operating income and income before amortisation of intangibles and one-time items to be the most relevant benchmarks of the company's finan-cial performance, as they measure our operational performance and our ability to fund growth and distribute divi-dends".



Effective from fiscal year 2002, Adecco has adopted SFAS No 142, which requires that goodwill and other intangi-bles with indefinite/infinite lives no longer be amortised, but be subject to an annual impairment test. However, in-tangibles with definite lives continue to be amortised over the related lifetime.



Statements made in this press release, other than those concerning historical information, should be considered forward-looking and subject to risks and uncertainties. The Company's actual results may differ materially from the results anticipated in these forward-looking statements as a result of certain factors as set forth in the Company's reports on Form 20-F made pursuant to the Securities Exchange Act of 1934. For instance, the Company's results of operations may differ materially from those antici-pated in the forward-looking statements due to, among other things: our ability to successfully imple-ment our growth and operating strategies, fluctuations in interest rates or foreign currency exchange rates, changes in economic conditions, changes in the law or government regulations in the countries in which Adecco operates, instability in domestic and foreign markets, our ability to obtain commercial credit, and changes in general political, economic and business conditions in the countries or regions in which Adecco operates. In addition, the market price of the Company's stock may be volatile from time to time as a result of, among other things: the Company's operating results, the operating results of other staffing service providers, and changes in the performance of global stock markets in general.

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