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Despite a year, to a large extent characterised by financial turbulence and uncertainty in the world, our company has had sustained, stable, and strong performance. We have continued our successful way of securing that clients will acquire and develop the leadership they need to outperform.
Strengthened client offer with MU Leader Selection Science®
This year the distinct Mercuri Urval way of working was further developed and underpinned. The concept that we use for that is MU Leader Selection Science® which provides a clear foundation for our client offering and brand.
MU Leader Selection Science® reassures a science-based, precisely tailored, and quality-assured service delivered by a certified MU expert team. The new profile and communication with the market have also been sharpened and strengthened.
In spite of the turmoil we experienced after Russia’s war against Ukraine which resulted in raw material shortages, supply chain issues, rapidly increasing interest rates and at least a temporary rebirth of inflation, the demand for our services was strong in 2022. Net income increased by 6% as we continued to increase the share of the business that comes from leader acquisition, now well over 50%.
EBITDA amounted to 12 MEUR and the corresponding margin was 16%, somewhat lower than last year as we continued to invest in our people and activity-related expenses moved back to more normal levels after two years of covid related restrictions on travelling and meetings. Earnings after tax amounted to 8,5 MEUR and the net margin was 11%.
The profit in 2021 meant that substantial dividends were paid to partners (the partner company) in 2022, but part of the net profit was also used to fill up the company buffer for unforeseen events. As the financial safety net is now considered strong enough, the full net profit can be paid to partners. The effective tax rate increased as historical tax losses carry forward decreases with good earnings and the 2021 profit included a tax-exempt one-off gain. Even if the net profit after tax is lower in 2022 than in 2021, expected dividends can be higher as the full net profit will be available for dividends.
A strong balance sheet with reserves for uncertain times.
High profits and strong margins.
Good profitability and a healthy balance sheet make it possible to continue to invest in our people and in developing the company’s service offerings.
Record high dividends to partners expected.
The year ahead
In the coming year, we will continue the upgrade of MU’s world-class services, methods, and tools. We will continue the development of our industry practices providing clients with the expertise to help them outperform. This focus will ensure we continue to deliver outstanding results for our clients, colleagues and stakeholders.
Acquiring and improving leadership is the greatest challenge organisations face – and the only way they can sustainably outperform. Today our clients need effective, sustainable, and diverse leadership more than ever. We plan to grow carefully, to safeguard our profitability.
Key focus areas for management in 2023
Continued enlargement of our presence in key markets, industry practices, and global reach through careful and selective hiring of senior consultants and senior delivery experts.
Launch of our Board and CEO practice.
Further upgrading of our class-leading science-based Executive Search and Leadership Advisory services, including further research and validation studies into leadership recruitment and development.
Further strengthening our industry-leading quality assurance and certification regime for MU experts: Focus on the scientific basis for predicting leader success, and inclusion and diversity.
Significant ongoing upgrades to our services through the MU Research Institute.