A WEE DRAM
CHRIS GILMOUR: Workforce focuses on diversification as recruitment sector makes for hard toil
Workforce has operations across Southern Africa, and is now 51% black owned, with black women owning 30% of its shares
Human resource and recruitment group Workforce Holdings flies well below the radar of most investors. Its thin tradability, with only about 8% of shares held publicly, can give rise to wild price movements on very small volumes, and this explains its very low price-earnings ratio at 2.8 times on a share price of 120c. It also operates in a currently out-of-favour sector — being recruitment — which is seeing much antipathy coming from the unions. Additionally, it enjoys an extremely low tax rate, due to the favourable application of employee tax and learnership incentives, and if those were ever to fall away, earnings would be severely impacted, and investors perceive this as an incipient risk. Originally established as a recruitment agent nearly 50 years ago, listing on the JSE in 2006, Workforce has metamorphosed into a diversified group offering an extensive range of integrated human resource solutions across three functional areas: staffing and outsourcing; training and consultin...
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