New Work SE confirms its forecast in a difficult market environment

Revenue in the HR Solutions & Talent Access segment fell by 6% to EUR 50.4 million (Q1 previous year: EUR 53.3 million). This is mainly due to the decline in job advertisements placed, an effect of the recession in which the German economy finds itself. As expected, the B2C business fell by 18% to EUR 15.9 million (EUR 19.5 million). This is due to the change in strategy, which focuses entirely on monetization from HR Solutions. Sales in the smallest segment, B2B Marketing Solutions, fell by 36% to EUR 2.0 million (EUR 3.1 million). Total revenue was down ten percent on the same quarter of the previous year (EUR 68.2 million after EUR 75.9 million in the previous year).  

Despite the particularly difficult labor market environment, New Work SE continued to invest consistently in the implementation of its strategy in the first quarter of this year. For example, Xing launched the largest advertising campaign in its history. The brand is also the main sponsor of the newly founded Baller League in order to reach new, young target groups. kununu, the leading platform for employer reviews in DACH, has also invested further in its growth strategy, with a regional campaign in the most populous federal state of North Rhine-Westphalia. The investments had a negative impact on pro-forma EBITDA adjusted for restructuring costs, which at EUR 9 million was 50 percent below the previous year's figure (EUR 17.9 million). Adjusted pro-forma consolidated net income therefore fell by 87% to EUR 1.1 million (EUR 8.4 million).  

Petra von Strombeck, CEO of New Work SE: "We are in the middle of restructuring the company. Xing is becoming a jobs network, and monetization is taking place consistently via our HR Solutions. However, repositioning one of Germany's best-known internet brands is an undertaking that cannot be accomplished overnight and requires significant investment. In the first quarter, we made these investments consistently and to a considerable extent in order to position Xing as a network that is first and foremost about jobs and addressing new target groups. And kununu also made a strong and successful impression in western Germany in the first quarter in order to further accelerate the brand's growth." 

Thanks to the continued very positive development of Workplace Insights, which increased by 28% to 11.2 million in the first quarter of 2024, kununu has not only expanded its overall market leadership in German-speaking countries, but is now also the leader in DACH in terms of individual salary data with 4 million. The sharp increase in data points not only ensures a high level of quantity, but also provides qualitatively up-to-date insights due to its topicality. 

The transformation of Xing into a jobs network is being driven forward. In Q1 2024, there were several changes in the product that resulted in positive changes in the measurable KPIs: Firstly, work was done on the visibility of recruiter profiles, which was reflected in a 200% increase in visits to recruiter profiles. On the other hand, millions of Xing users have already filled in their individual wishes for a suitable job in the newly designed "Job wishes" section, so that they can be shown the right job offers even better. Xing's annual launch campaign provided communicative support. With a new spot and very good values in terms of recognizability, product usage and reach figures - especially those of the digitally played campaign videos.  

The planned comprehensive restructuring measures have been largely completed ahead of schedule. 85% of the cost savings have already been achieved, although the savings effects for the year as a whole will not take effect until 2025. 

Despite the challenging macroeconomic environment, New Work SE confirms the forecast adjusted in January 2024. The company expects pro forma EBITDA of € 55-65 million.

Source: www.new-work.se