capital markets day 2017 london. human forward.

capital markets day 2017 london. human forward.

group strategy & vision jacques van den broek, CEO london capital markets day november 21 2017

agenda our new brand positioning 6 strategic roadmap 7 ABFS 2018 9 tech as a differentiator 10 a structural growth industry 11 topline growth accelerating versus peers 12 tech & touch initiatives by Randstad 14 conclusion 16 Randstad 3

our brand positioning tech-driven but human personal. helpful. caring. relationship-focused. generic players traditional authority via legacy. professional players tech players innovative authority via change through data. more tech, algorithm driven. Randstad 4

strategic roadmap best people, strong concepts, excellent execution & superior brands grow to 5-6% ebita profitable growth improve margin increase productivity our ultimate goal by 2030, we will touch the work life of 500 million people worldwide Randstad 5

strategic roadmap best people, strong concepts, excellent execution & superior brands productivity (GP/FTE) up 3% YTD prior cost savings programs on track new cost savings of 90-100M HR Tech opco initiatives TTA -> enterprise clients growth in MSP (+11%) & RPO (+30%) YTD 2017 grow to 5-6% ebita profitable growth improve margin increase productivity our ultimate goal by 2030, we will touch the work life of 500 million people worldwide inhouse growth 18% YTD 2017 professionals growth 4% YTD 2017 perm growth 9% YTD 2017 SME growth 10% YTD 2017 Randstad 6

ABFS 2018 integrated tech approach is crucial Randstad 7

perm contingent workforce tech as a differentiator: higher barriers to entry, favouring big players in a fragmented market where scale and proximity matter tech touch tech touch self-service platforms integrated talent management tech touch tech touch digital platforms talent engagement SME clients large Randstad 8

a structural growth industry staffing penetration rates rise over time trends and growth drivers 3,3% globalization 3,0% 2,8% 2,5% technology 2,3% 2,0% 1,8% 1,5% demographics 1,3% 1,0% variety of work forms governance of work 0,8% 0,5% 0,3% 0,0% Belgium France Germany Netherlands Spain Japan US Italy 2007 2015 source: CIETT Randstad 9

topline growth accelerating vs. peers powered by integrated tech organic revenue pwd growth by quarter, 2012-2017 organic revenue pwd growth, 2017 YTD france 15% 10% 5% 10% 0% Randstad Peer 1 Peer 2 8% 6% 4% italy 30% 25% 2% 20% 0% -2% -4% 2012 2013 2014 2015 2016 2017 15% iberia 15% Randstad Peer 1 Peer 2-6% -8% 10% Randstad Peer 1 Peer 2 5% Randstad Peer 1 Peer 2 Randstad 10

inhouse: strong growth continuing future powered by tech 4.500 4.000 3.500 3.000 2.500 2.000 1.500 1.000 500 -- 22,4% 21,0% 21,9% 19,5% 17,9% 14,1% 15,0% 11,1% 11,0% 10,6% 4,6 9,1% 4,2 3,6 3,1 3,2 2,6 1,9 1,9 2,0 1,5 1,3 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 25% 20% 15% 10% 5% 0% Inhouse Rev ( B) share of total revenue what is inhouse services? 30% 20% 10% 0% -10% 25% 21% 18% 18% 15% 12% 9% 11% 10% 13% 9% 12% -2% 8% -3% 6% 5% -2% 4% 2007 2008 2009 2010 2011 2012 2013-1% 2014 2015 2016 2017 YTD high volume clients high productivity high customer intimacy (98% retention rate, often 100% market share) Average organic sales growth rate 2006-2016: c. 10% -20% -30% -29% -27% Inhouse organic growth group organic growth Randstad 11

we are connecting the initiatives and scaling up successful concepts fast around the world. digital factory scale ups RIF (15 investments) data driven sales workforce scheduling external innovations via M&A tech & touch local innovations Capabilities (eg. SEO) global concepts Sales Navigator Big Data France Horton (US) Ploy SourceRight RiseSmart Global Clients Solutions Randstad 12

group P&L impact experiment, focus, proof, scale up validate business cases on hard data & leading KPIs problem/solution fit product/market fit scale addressable market achievements so far growth potential tools pilot MVP roll-out Randstad 13

conclusion integrated tech approach is crucial higher barriers to entry, in favour of big players riding the learning curve: experiment, focus, proof, scale up large addressable market size identified ambition gain further market share driven by our differentiating tech & touch strategy Randstad 14

agenda 10.30 11.00 financial strategy & trading update Robert Jan van de Kraats 11.00 11.30 Q&A 14.00 15.00 data driven sales NL & France Dominique Hermans & Sébastien Hélaine 15.00 15.15 coffee break 11.30 11.45 coffee break 11.45 12.15 US staffing/professionals & Monster Linda Galipeau/Chris Kibarian 12.15 12.30 Q&A 15.15 16.00 workforce scheduling François Béharel 16.00 16.30 enterprise clients Rebecca Henderson 16.30 16.45 wrap up 12.30 13.30 buffet lunch 16.45 17.30 drinks and canapes 13.30 14.00 digital strategy: deep dive Jacques van den Broek Randstad 15

financial strategy & trading update robert jan van de kraats, CFO london capital markets day november 21 2017

agenda current trading & outlook 21 revenue growth accelerating versus peers 22 perm: a major opportunity 24 cost savings update: consistent benchmarking 26 EBITA margin progression & outlook 27 M&A update & outlook 29 FCF stability through the cycle 31 capital allocation priorities 33 conclusion 34 Randstad 18

current trading outlook revenue growth in October in line with Q3 (+9%) volume trend in November so far appears to be in line with October robust growth in Europe continued, North America slightly improving there will be an adverse 2.4% comparison in Q4 gross margin in Q4 is expected to be stable sequentially for Q4, operating expenses are expected to be stable sequentially there will be an adverse 0.5 working day impact in Q4 2017 Randstad 19

topline growth accelerating vs. peers driven by improving macro in europe and integrated tech organic revenue growth by quarter, 2012-2017 10% 8% 6% 4% 2% 0% -2% -4% -6% -8% 2012 2013 2014 2015 2016 2017 Randstad Peer 1 Peer 2 france still c.15% below 2007 peak penetration rate in iberia (0.6%) and italy (1.2%) markedly below european average u.s. above peak and still growing Randstad 20

further improving relative performance france organic revenue growth pwd 16% 12% 8% 4% 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2017 Randstad Peer 1 Peer 2 italy 40% 30% 20% 10% 0% -10% -20% organic revenue growth pwd Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2017 Randstad Peer 1 Peer 2 north america organic revenue growth pwd 5% 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 iberia 30% 20% organic revenue growth pwd -5% 2015 2016 2017 10% -10% Randstad Peer 1 Peer 2 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2015 2016 2017 Randstad Peer 1 Peer 2 Randstad 21

DE NL BE group IT NAM ES IB FR UK AUS China perm: a major opportunity perm as % of GP, FY 2016 90% 80% 2017 YTD perm growth avg. growth competitors 1 2 7% 9% 70% 60% 50% 40% In 2017 YTD perm made up 10% of group GP (~12% in 2007) We have the potential to double in established markets 30% previous group peak: 12% Strategic focus paying off as we outgrow our peer group average 20% 10% 1 Competitors; Page group, Hays, Adecco, Manpower 0% & Robert Half 2 Organic growth, excluding RPO Randstad 22

perm offers ample growth potential perm growth 2017 YTD 40% 30% 39% 16% 36% 24% 20% 10% 0% 9% 4% 5% 3% France Netherlands Germany Belgium % of perm in country gross profit perm organic growth Randstad 23

total upcoming cost savings 2018/19: 90-100M Randstad 24

adjusted EBITA margin progression in 2017: a balancing act adjusted for digital investments & working day effect 6% 5% 4% 4,7% 4,5% 5,0% 5,1% 4,9% 5,4% 3,6% 3,8% 3,8% 3% Q1 2016 Q1 2017 (reported) Q1 2017 (adjusted) Q2 2016 Q2 2017 (reported) Q2 2017 (adjusted) Q3 2016 Q3 2017 (reported) Q3 2017 (adjusted) Randstad 25

ebita margin outlook 2017/18 topline growth consensus + 4.5% sales growth 2018 expected market outperformance topline growth business mix digital opex digital ongoing investments early signs of additional sales growth business mix focus on perm/profs/inhouse/sme; pricing opex 90-100M annual savings by 2019 consensus FY 2017 EBITA margin: 4.6% outlook 2018: further progression towards 5-6% EBITA margin Randstad 26

acquired companies well on track aim to be top 3 in local Staffing market strengthen Professionals business accelerate digital strategy progress towards EVA after 3 years in line ahead ahead underway ahead underway randstad 27

M&A outlook 2018 and beyond tech & touch strategy professionals staffing mainly organic through digital factory repair Monster & global roll-out acceleration through Ausy (organic & bolt-on M&A) over time: small to midsized M&A top position in most relevant markets, ex-japan, UK & Australia no priority focus on value creation on the basis of current footprint no large transformational M&A going forward limited M&A in 2018 Randstad 28

FCF stability over the past 10 years 800 700 600 500 400 300 200 100 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 FCF ex-cice ( M) CICE ( M) leverage ratio 3,0 2,5 2,0 1,5 1,0 0,5 0,0 Randstad 29

for illustrative purposes, graph not to scale FCF outlook is consistent in various macro scenarios working capital movement is counter cyclical 3.000 FCF outlook 2017 2020 tested against 6 macro scenarios: bandwidth is only 20% 2.500 2.000 1.500 1.000 500 - FCF cumulative 2017 to 2020 1 2 3 4 5 6 FCF scenarios accumulated 2017-2020 Randstad 30

capital allocation priorities & dividend policy old 1. investments in organic growth new sound FCF outlook 2. M&A activity investments in organic growth including digital 3. dividend maintain cash dividend policy with payout 40 50% 4. share buybacks* selective M&A when leverage ratio < 1.0 -> optional additional cash returns to shareholders 5. special dividend* more details H1 2018 Randstad 31

long term value creation through tech & touch strategy optimizing EVA by steering on key levers Randstad 32

questions & answers