Listed company valuations

Although average EV/LTM EBITDA multiples decreased significantly in the first six months of 2023, signposting a decrease in valuation of large UK listed recruitment companies, multiples increased in December 2023 to 5.9x and showed a rising trend in the second half of the year. This is higher than the average EV/LTM EBITDA multiple of 5.7x seen during 2022 and is a positive sign for the sector.

The impact of global uncertainty and rising interest rates in the first half of the year meant that companies stepped back on recruitment. This was particularly felt in the permanent recruitment space, and trading profitability for some key entities was down. However, as interest rates started to stabilise in the second half of the year, the value of large comparable recruitment companies has risen. This is a trend that is expected to continue during 2024 and we have seen average EV/LTM EBITDA multiples at similar levels in the first two months of 2024. Both were also significantly higher than the 2023 average.