Hello, welcome to the Randstad first quarter results for 2021. My name is Jess, I'll be your coordinator for today's event. For the duration of the call, your lines will be on listen only. However, there will be the opportunity to ask questions. This can be done by pressing star one to register your question at any time. If at any point you require assistance, please press star zero on your telephone keypad and you will be connected to an operator. I will now hand you over to your host, Jacques van den Broek, CEO, to begin today's call. Thank you.
Yes, thank you, Jess. Good morning, everybody from a sunny Amsterdam, which I think is symbolic for the numbers we're presenting with you this morning. I'm in our conference room at head office, together with Bisera and Steven from IR, and of course, Henry. I'm wearing a suit. Maybe you can't hear that, but I'm wearing a suit, so that's been a long time ago. Yeah, we had a solid start in 2021, as you can see. As we said before, we feel we're stronger and very well positioned for what we called in our press release, a truly dynamic world of work. What we mean by that is that it's not business as usual. It's going to be about talent strategy, scarcity, immigration, reskilling. Very interesting to be in this space.
We generated a strong set of results in the first quarter, growing 6.4%, and very positive momentum across all of our geographies, despite still a lot of local lockdowns and of course, still macroeconomic uncertainty. We created for you a new slide relatively, which is going to be the next one, just to show you that in a way, 2020 is a less relevant year. Normally, we compare, of course, but now we benchmark ourselves against 2019, and that's what we would like to show you and share with you. We exited the quarter with double-digit revenue growth, but activity momentum in April 2021 is, as I said, reaching these levels of 2019. We continue to see good momentum for accelerating our investments in growth and digitization of our company, and at the same time using the flexibility of our cost base.
We already welcomed 1,000 new colleagues, and again, most of them have been inducted virtually. At the same time, we also improved our productivity. Most of these people came in at the end of the quarter, so their productivity is still relatively low, but still good to see that overall, we improved the productivity. That delivered, of course, a solid EBITDA margin for the quarter and a strong recovery rate. Almost all regions grew in Q1 with outperformance in markets such as the U.S., France, Belgium, but we're also ahead of market in Argentina and Brazil, and they delivered an outstanding performance. A little bit more on that when I comment around the rest of the world.
In-house, the eternal winner, fortunately in our business mix, continued to perform well, and we're very pleased to see our industry fundamentals are reconfirmed with the staffing penetration rates bouncing back quickly, which, for example, is very interesting in countries like Italy, but more then later. Our New Ways program continues to help clients operate safely and efficiently, and as markets gradually reopen and people start returning to the workplace, we are ready to support them as they adapt to the rapidly evolving global economy. There's going to be work for almost everybody. We're going to be short of people, but at the same time, underlying, there needs to be massive reskilling from mostly white-collar jobs into technology, engineering, education, health care, e-commerce, those kind of sectors. Our first priority still is the health and safety of our employees, candidates, clients, and other stakeholders.
I would once again like to thank my Randstad colleagues for their incredible commitment and dedication during these extraordinary times. Let's go to the next slide, which I already introduced. You can see, the yellow line, that is 2021. We're really getting close to 2019 in April. Very happy with that. As said, because it's so tough to call, you're probably going to ask us a lot of questions about the trend and what remains is the visibility, right? It is six weeks, yeah, as always, so far, so good. The strength of our performance in this first quarter gives us confidence for the remainder of 2021. We still, of course, have caution. This morning I heard Boris Johnson say that we need to live with the virus. That's true, for us, so far, so good.
The 1,000 people, that is a large beginning, but it might still be that we take in more people as we see more momentum in many markets. Let's go on the next slide to our two biggest markets, North America. They continue to grow. Very strong growth of staffing. Mentioned in former calls, the many new on-sites that we opened in our In-house business, and that of course helps to grow. It's getting tougher to find people already in our staffing business. 12% growth in staffing and In-house. 7% in Q4, speeding up. As you know, In-house is mostly in sectors like logistics, food, retail, and the likes. U.S. Profs, a mixed picture. Definitely resilient performance of our technologies business. Of course, it was stable throughout the year.
The U.S. has still relatively tough comps compared to Europe because, in Q1 last year, the business didn't go down. This growth is very strong. In the U.S., in the beginning of the year, Jan and Feb, we had some margin issues on state unemployment insurance. We have a specific group in our IT business. They are immigrants. They work on H-1B visas, and we have them on our payroll. We support them. In the beginning of the year, we had some idle time in Jan and Feb, that in March is already largely out. The overall margin in the U.S. is back to normal levels, I might say. France. For already three quarters, France is a very happy story, which is not so much maybe the economy of the country. We do very well.
Ahead of market, we continue to see strong demand in sectors as food retail, again, healthcare. We're by far market leader in healthcare in France. Logistics and driving in-house to growth in the quarter. Profs turning into growth territory, mainly driven by our healthcare business. We observe continued recovery in the Perm fees. Growing again 3%. Very nice surprise there. Again, mainly driven by Perm and Profs. We want to single out Ausy. Ausy is our statement of work business in IT and engineering, where we made quite some changes. There's a new leadership. We appointed Jérôme Comar. Jérôme has been with the business many years. He ran the business outside of France. We named Jérôme CEO, brought in a new CFO, Jérôme and his team really get back to work.
Mainly our French business is not well positioned in terms of sectors when you look at COVID. Aeronautics, airlines. They really did an excellent job on improving the productivity and, how do you call it, diminishing the bench in France. That really helped our results in France. Well done, Ausy team, and we like more of that. I know they're on the call, that's why. The Dutch business. Again, strong performance there. We are getting closer to market, so good. We see continued recovery in the automotive and manufacturing, where again, sectors such as healthcare and e-commerce continue to perform very strongly. We opened 19 new In-house locations this quarter alone. A very strong start of the year. We do expect this to help our revenue going forward.
Randstad and Tempo-Team up strongly and Yacht, already strong performance last year, but they exceeded 2019 levels, which we think is a remarkable performance in these volatile teams. Very well done, Yacht, and also BMC, our acquisition in this field. EBITDA margin came in strong, 6.4%. Strict cost management, but also less sickness. We carry our own sickness risk in the Netherlands, and that helps in this case in margin. Germany, growth again. 2018 was the last time we saw growth. 5% this quarter. Strong recovery through the quarter. Very prolonged, certainly in Germany, macroeconomic headwinds, which started in the second half of 2018, as I said. Industrial sectors like automotive and manufacturing continue to recover. At the same time, our New Ways program, we've seen increased commercial activity in our German business.
Well done, good growth, and we're still going to work on the returns, of course. Our Belgium business, ahead of market, slight growth. Belgium business, Belgium market, as also the Spanish market, a little bit later, they are still a bit subdued. The lockdowns have an effect on theme parks, that sort of thing, which would normally open this time of year. That's not the case. What we also saw, very surprising, is a strike day in Belgium. I don't really understand why we should be striking when we need to get out of an economic crisis, but that's a different topic. Very well-performing Professionals business. Again, Ausy, also in Belgium, did very well. Also compliment for our Professionals part in Belgium. Italy. Again, Italy 20% up, so they are also ahead of 2019. Italy is an excellent example of a still relatively immature staffing market there.
European average is 2.3%. Italy is probably at 1.3. We do see structural growth opportunity given the still low penetration rate. We're also opening branches in Italy. If you look at our network in Italy, it's relatively less dense compared to our other major markets. We get a lot of questions about branches. Well, if you penetrate a new region with a branch, of course, heavily digitized, you create new market opportunities. Very well done. A great EBITDA performance based on also productivity gains. As I said, Iberia, a little bit slower to recover. What we see here is an aspect you probably know, and that is based on the semiconductor shortage in automotive. Productivity or production, certainly in Spain, is a bit subdued. We think it's short-lived, so there's still some promise in there of the growth also picking up in Spain.
Well-run company, they managed to keep their returns stable. Mixed picture in the other European countries. Good growth in the U.K. and strongly increasing growth into the next quarter. I want to single out Poland with 44.0%. This is not a small business. We're market leader here. The Polish business, yeah, the bill rates are way lower than the rest of Europe, but this is a very sizable business where we have thousands of people at work. Very well done of our Polish colleagues. The rest of the world, for me, this is a gift that keeps on giving, really firing on all cylinders. In Japan, 4%, very strong performance, good profitability. LATAM. I want to single out Brazil. Didn't talk too much about Brazil, but of course, in our portfolio, we have a few long-term promises.
India is, of course, a well-known one of those. China is. Certainly Brazil, a subcontinent in Latin America, under the leadership of Fabio Battaglia, doing very well. I think we're currently looking for close to 100 people, new colleagues, to fuel the growth in Brazil, and getting to a number one position. Fabio has also said to me that in staffing, that he also wants to go for the number one position in Profs. Good for you, Fabio and team. Keep it up. Argentina, where we have 20% market share now. Being leader with 20% market share, all organic, excellent performance. Look at profitability, right? Growth is one, but this whole region comes in at above group profitability. Very happy with that performance. The global businesses. This is a business which is really our future.
I talked a bit about Monster. Monster is rolling out the new technology in two parts there. First there is the, call it the seeker part. The candidate part, that is almost now fully implemented in the markets where Monster is in. We do see good increased visits, but certainly apply starts. Apply starts are important because then people leave their resume and they become part of our database. As you know, we want to build the biggest talent engine in the world. Monster, having accessible, good technology will definitely help. We're now rolling out the company part, which has a lot of dynamic pricing and e-commerce suite that'll probably go into Q3. Really setting up for success. Very happy with that. Took us some time, but well done, Monster team. Keep at it.
What is important is all the technology delivered for Monster, the websites, and what have you, is dedicated and developed for the rest of Randstad. Sourceright, very strong pipeline in RPO, which I think is a good sign of things to come. Our RiseSmart business was already very strong in the U.S. last year. We now see a lot of growth in the European business. Increasingly, this is not so much purely about our placement, increasingly about what we call total talent management. A lot of talks with companies on what does your workforce look like in the future? Back to this reskilling agenda. Overall, lots going on in this business. What does that mean for the numbers? Henry?
Thanks, Jacques. Good morning, everybody. Yeah, the company delivered yet another strong quarter, and most importantly, returned back to growth. More and more business units are even exceeding 2019 top-line numbers already. Our focus to deliver accelerated profitable growth gave us another quarter of best-in-class returns, and even more importantly, is putting us in a pole position to fully utilize the benefits from an ongoing strong market recovery in 2021 and beyond. We benefited from our diversified geographical footprint with excellent growth coming from the U.S. and rest of the world. Also our differentiated concepts such as in-house and the deep market penetration in sectors like logistics, e-commerce, healthcare, and government continue to perform well. Revenue growth in quarter one came in at 6.4%, and the growth momentum continued to improve further throughout the quarter. The recovery of volume and revenue is broad-based.
All countries enjoyed positive growth in March. I'm especially pleased with the fact that we continue to achieve market share gains in significant parts of our portfolio while respecting the need to drive pricing discipline. Gross margin in the period came in strongly up 30 basis points sequentially, however, still down 20 basis points year-over-year. We go more into detail on the next page. With regards to OpEx, we delivered another quarter of balanced cost management, with operational expenses being stable organically year-over-year. You also know the secret that we are pushing hard to invest into our growth capacity well ahead of the recovery curve. If anything, we would love those investments taking hold even faster than what we're currently experiencing. We continue to operate from a position of strength and our recovery ratio over the last four quarters of 51% is well in control.
As you would expect from us, we also accelerated investments into our digital journey and will stay the course going forward. EBITA came in at EUR 202 million at a margin of 3.7%. Of course, a momentous improvement compared to last year, but maybe more telling, not too far off from our 2019 level. On the next line, integration and one-offs were EUR 27 million positive this quarter, and this includes the book profit of EUR 35 million related to the disposal of a minority stake in Alma Career, partly offset by smaller restructurings in several countries, with underlying effective tax rates came in at 27.4% for the quarter. For full year, we expect an effective tax rate between 26%-28%. Let me now take you to the next page to talk about gross margin in a bit more detail. Here we go on page 15, the gross margin bridge.
The first red bar shows the temp margin, which is stable year-over-year. The temp margin saw the annualization of COVID-19 related effects like idle time, but somewhat offset by some working day headwind. Most importantly, we can confirm a generally stable pricing climate across the board, and the bar in the middle projects a 10 basis points negative mix effect triggered by a 5% decline of Perm activities. That is a significant but expected improvement versus the firm mix effect we've seen in quarter four, which was 30 basis points down. Lastly, HR solutions represent a negative mix on overall gross margin of 10 basis points, pretty much in line with quarter four.
Whilst our gross margin path remains difficult to predict, we reiterate the importance to safeguard attractive gross margins in all our business activities, also achieved through smart value-based pricing, strategic mix management, and winning mass customized digital support. That gets me to the OpEx bridge on page 16. Here we go. With volumes and revenue getting closer to 2019 levels, it is important to understand how we steer OpEx in this phase of the recovery. Our OpEx management tries to secure the full and speedy recovery of our top line, the full utilization of further growth momentum in our markets, and uncompromised investments in our digital capabilities. In that context, we reported organic OpEx sequentially up EUR 12 million and stable versus last year. In a bit more detail, this means that personnel expenses increased by 7% sequentially, which represents about 1,000 FTEs more on our payroll.
Despite the drive for accelerated growth, we continue our tight field steering, which yielded a solid 10 percentage points improvement in our productivity, measured as gross profit per FTE on a year-over-year basis in quarter one. Our cost optimization program is in full swing as we continue to identify productivity opportunities in order to create room for additional investments and to accelerate the growth and to continue transformation our digital capabilities and automation. That productivity journey has become part of our DNA and will provide ongoing self-help to secure sufficient fuel for growth and market-leading profitability. Since we announced the journey back in November 2019, more than EUR 100 million of structural cost reductions have already been identified across all cost categories, utilizing the power of One Randstad now and also going forward.
We continue to nurture a climate of entrepreneurship within the company, where smart growth initiatives can and will be fully supported with appropriate investments. With that in mind, let's now move on to our cash flow and balance sheet on page 17. We generated a free cash flow of EUR 4 million in the first quarter, up EUR 16 million year-over-year, EBITDA did fund operating working capital, including the settlement of governmental release measures totaling EUR 85 million. Very tight credit control and debt collection helped our DSO to improve year-on-year and through the entire COVID period. CapEx in quarter one increased by EUR 19 million, reflecting our ongoing digital investments. Let's now zoom in on our strength for our balance sheet on the right side of the chart.
As per end of March this year, we reported a net cash position of EUR 387 million, excluding lease liabilities with a leverage ratio of -0.5 pre IFRS 16. Regular dividend of EUR 1.62 per share and dividend on preference B and C shares is paid on April 6th, totaling EUR 306 million. That already brings me to my last chart, the conclusion outlook, page 17. As stated before, the pace of revenue recovery is sustained for the first quarter and is broad-based across our portfolio. At the same time, visibility remains limited, especially with ongoing macroeconomic uncertainty due to COVID-19 pandemic. The development of volume in April is reaching 2019 level with continued improved momentum. The latest trends show that April activity momentum accelerates compared to the March exit rate, which was 14%. For quarter two, gross margin is expected to be slightly higher sequentially due to seasonality.
OpEx, however, is expected to increase low to mid-single digit percentage sequentially, driven by accelerated investments in growth considering our expected growth momentum. As you know, we are aiming for an incremental conversion rate of 40%-50% over time. However, for quarter two this year, we expect an incremental conversion rate of 50%-60%. Lastly, let me mention that there will be a positive 0.6 working days impact in quarter two. That concludes our prepared remarks, and we're now happy to take any questions. Back to you, Jess.
Thank you. If you would like to ask a question, please press star one on your telephone keypad. Please ensure your line is unmuted locally as you will be advised when to ask your question. Once again, that's star one if you would like to ask a question. The first question comes from the line of Paul Sullivan from Barclays. Please go ahead.
Good morning, everyone. Just a few from me. Firstly, just on gross margin, shouldn't we expect the bounce in the second quarter to be slightly bigger than the slight improvement that you're sort of alluding to? Maybe you could go through the moving parts there. Secondly, on the ICR clearly outperforming in Q2, do you think we should expect some of that to reverse in the second half? Your thoughts on investment into higher growth as that continues through the second half of the year. Finally, your thoughts on sort of candidate wage inflation, and when does availability start to become problematic for you? Thank you.
Let me take the first two. Hi, good morning, Paul. As far as GM, gross margin, is concerned, look, there's not too much to add to what I've said. Of course, it's good to see that firm or firm business has got good momentum. That's always helpful. Also, 0.6 better days in quarter two is good. We definitely also start with value-based pricing, but don't underestimate the impact of mix. We have a very strong performing in-house business, 13% this quarter, 8% last quarter. That definitely also has an impact. Unfortunately, can't give you a bit more of a steer there. As far as ICR is concerned, as you know, we've been quite vocal that we want to drive growth and want to really benefit from what we believe will be a good year in there.
We stay very close on the ball, so giving you any insights into H2 would even be bigger than what we see. As Jacques always says, we look in the next six weeks and really dialing up and down. At the moment, dialing up, we just stay close on it.
Yeah. Again, Paul, the speed of recovery also hinges around the speed of vaccination, which, of course, although we do support some of that, it's not our call. Remains to be seen. Candidate scarcity. Yeah. Well, again, the old themes are back, people are tough to find, specifically in the U.S. You've got the COVID support, which is good for people, but at the same time, you need, certainly in staffing, quite an hourly rate for it to be attractive to work. We do expect this to have an upward effect on wages, a bit early to call. That's the U.S., where this always reacts quicker. In Europe, this is very much also based on collective labor agreements and what have you. Always the reflex there is later. Might be a theme this year, certainly early days now.
Great. Thank you very much.
The next question comes from the line of Oscar Val Mas from JP Morgan. Please go ahead.
Good morning, everyone. Can you hear me?
Yep.
Yes.
Okay, perfect. Two questions from me. The first one on the Q1 impacts from either transport and logistics and then vaccination. The first one on transport and logistics. It was a strong Q4. Could you comment on what you've seen in Q1 and what your thoughts are for the full year in terms of what do you think, if there's any slowdown in logistics or e-commerce transport volumes? Also in terms of vaccination, you've talked about it being a benefit for the group. How material is it? Is it material in any specific regions like Italy or the Netherlands? The second topic on market share. You've talked about taking market share. Could you give concrete examples of where that has happened and why you've taken market share?
Has it been competitors not being able to compete, in terms of digital products, or are there any other reasons why you're taking market share?
Yeah, there are quite a few reasons why we take market share. The first one is, I think we called the return to growth rather quickly. We announced this New Ways program to aggressively invest in sales activities. We have digital support. In that sense, back to your question, yeah. We can point our people to where demand is, so that helps. We have a two weeks global call with all our management, how we're doing. We have a stack ranking on activities. We share best practices. Yeah, although 2020, from a COVID point of view, was of course not a great year, but we learned a lot as a company to beef up our presence in the market and make it relevant from a content point of view also for our clients in these COVID times. That has helped. Yeah.
Next to that, we have our In-house business, which is very much geared towards quickly reacting businesses up and down. Apparently, the story is well liked. I mentioned the 19 branches in the Netherlands alone. I mentioned the U.S. last year. That has helped us a lot. The COVID-related activity is material in the Netherlands, less material in other countries. Yeah, this is, call it, communicating vessels. If COVID support goes down, the economy goes up. Again, Henry calls this fish where the fish are, so that's where a lot of fish is. We're there, and if we get the chance to support, we're going to do that. Yeah, how that goes into next year, I think the beauty of this business is always we don't know. That keeps us on our toes, and time will tell.
Yeah, we're optimistic based on what we see now.
Yeah. Maybe if I can chime in. Hi, Oscar. On transfer and distribution made up about 25% of our revenue in quarter 1 with definitely higher growth dynamics than the rest of the group. Let me stay there.
Okay, that's perfect. Thank you.
The next question comes from the line of Anvesh Agrawal from Morgan Stanley. Please go ahead.
Hi. Good morning. I got two questions as well. First, obviously, we've seen a very fast recovery and probably better than what we were expecting. Outside of the cyclical pickup, anything structural you have seen so far that sort of gives you confidence that next cycle overall will be better than the last one, and therefore you can grow at a higher rate for a longer period of time and not just the cyclical momentum you're seeing? Then second, looking at the guidance on the SG&A of low to mid single-digit up, and if you think about Q3, Q4, and I know you don't give guidance, but assuming that the activity levels sort of remain in line with 2019, do you then expect the SG&A to sort of stabilize sequentially? Or that will continue to inch up as we progress through the year?
Anvesh, good morning. Structural. That's always the big question, right? What do I see? The first one is, as after any crisis, the first demand will be filled by us. The second demand might be perm, can also be filled by us. Again, back to former crisis. We have a way better presence in perm, in RPO, that sort of thing. I already called out markets like Italy, but also Spain, which still very relatively low penetration rate. What's also interesting is legal systems. We had a lot of populist stuff before COVID, but I think we've proven as a sector that we're very helpful to get people back into jobs, to reskill people. We think that will find its way into legal systems.
Of course, we lobby a lot and we make proof points on the fact that everybody that lost their job is now back, that we change people from sector to sector. Nobody can do that. Certainly not public employment agencies. That helps. Lastly, very interesting discussion is the gig economy, right? Didn't exist in the last crisis. You have the big debate versus societal, but now fortunately also the legal one, is that the platforms that put people to work as so-called freelancers is really not what you should be doing. Companies like Ajett, Just Eat Takeaway are very vocal on the fact that they want people well secured on the bike, and then we're there to help. Picking up aspects of this gig economy is, again, could be a structural driver.
Please be aware that if 20%-25% of people work flexibly in the labor market, we are just 10%-15% of that. We think there's a lot of upside.
Hi, Anvesh. Yeah, thanks for the question regarding SG&A. I can only reiterate what I just said. We've really tried to stay very close on the ball. As I said in my remarks, we definitely want to support growth. We believe there's a lot of growth momentum. We are investing ahead of the curve. It takes a bit of time to get people on board and then making them as productive as possible. It's actually a nice dance of seeing that we have enough capacity in the business to grow and ideally grow competitively, as we love to see it. Really making decisions more or less on a two-weekly basis, honestly. Maybe it's also good to just reiterate, we've kicked off that cost-saving exercise, and that is still in full swing. Just as a reminder, we are working on eight categories.
We have a team working on accommodation, on fleet, employee benefits and insurance, indirect procurement, IT costs, T&E, marketing and advertising, and field productivity. That is something where there's so much energy in there because we're turning those productivity gains also back into growth. Unfortunately, can't give you more spiel for the second half, but definitely, 2021 for us is a year of growth. That for me is always the best program also then further on drive productivity to the next level.
Yeah, maybe a final word on that, because of course, there's different ways of putting people in a business. If we have an In-house, we put people in. We have the revenue already, and we put people in. These people are not so productive immediately, but it picks up very quickly. Then there's other businesses, right? We also said we wanted to invest in Perm really quickly, but it takes like at least nine months in Perm to have people productive. We are investing in our IT business in U.S., also in new regions. That's more the long game, so to say. When we try to also with these investments, not just follow the growth, but also create slightly different mix in our business, that comes with more cost, lower productivity, and we're quite bullish on doing that this year.
It's very much a moving target going forward.
That's very clear. Maybe if I just ask a quick follow-up. On this cost saving, how much of that are you expecting to come through in 2021?
Look, we've said we've already identified more than EUR 100 million, but we are taking the money, investing back into growth and while securing really good market leading profitability. That's what we'll continue to do.
Yeah. This is not a stable thing, right? When I'm going to fly, apparently I'm going to fly cheaper than I did before because of the program. I'm not flying. It's not like 2019. If we would do absolutely the same in 2021 as we would be doing in all the categories that Henry mentioned, we would do it at less cost, but we're doing less. In that sense, it's not comparable. Don't put in the EUR 100 million in your Excel.
Yeah. Okay. That's very clear. Thank you so much.
Before we go to the next question, as a reminder, please press star one if you would like to ask a question. The next question comes from the line of Marc Zwartsenburg from ING. Please go ahead.
Yeah. Thank you. Good morning, everybody. First question is on the investments you currently put in. You mentioned you put in 100,000 extra FTEs. How much extra growth can you, with the current setting and the current investments you have in the pipeline, how much can you handle compared to 2019? Can you, for example, with the current base of people and sales force and branches already handle quite some growth versus 2019? That's my first question. The other one is, maybe you can help me a bit with the bridge, because you mentioned we are approaching, in terms of volume levels, 2019 levels. What should we take into account in making the bridge to the revenue line, in terms of ForEx and maybe other elements that play into that bridge? With now volumes approaching 2019, looking to the second half.
In 2019, second half growth was negative at some point. Does that indicate that at some point, without even a further acceleration of the market, that you will see already growth in the second half of this year? Those would be my questions. Thank you.
That's growth compared to 2019 or?
Yeah, correct. 2020 is quite linear. Yeah.
Marc, sometimes you get good news and it's tough to ask further questions.
Yeah.
You're asking great questions, but it's not even like we know and we're not going to tell you, because it's different growth. It's a totally different business. Again, we're growing double-digit in LatAm and in Brazil and Argentina, and that's different business. We're investing in long-term business in IT, in Perm. If it was the same business, I could theoretically say, with so many people, we can do so much gross profit. Again, it's different business. On the one hand, if we grow more in in-house, yeah, the productivity goes up, but that's not the only thing we want to do. Then we have business which is better supported from a digital point of view. In some aspects, we have a higher productivity than two years ago, roughly with the same client. This is such a moving target.
It's not about the productivity of the growth, so to say. This year it's really about the growth, capturing as much as we can, of course, at decent returns. I was sort of, and this sounds funny, but we're amongst friends here, of course. I was a bit surprised on the productivity gain. My first reaction was, "Okay, so we didn't put in people quick enough and enough." We are not shooting for maximum ICR. That's not the theme now. Yeah, we're going to have a growth year at a decent return. That is the theme.
You are positioning for further acceleration of growth in the second half. That's also how we should read it then?
That is an entrepreneurial, I wouldn't say risk, but an entrepreneurial decision. The worst that could happen to us is that the growth is speeding up and we're not ready to handle it. What could happen is a little bit less growth than we expected. Well, we have a little bit too heavy cost base. That's too bad, that's the choice we're now making.
Yeah. Okay. Maybe then the bridge versus volume and revenue, things that are different from 2019.
Yeah. Again, so it's too early to call. Again, the good news is the slide. I especially created this slide for you to show where we are, and then the rest is talk to you again next quarter and the quarter after that.
All right. Thank you very much. Thanks.
Your next question comes from the line of Konrad Zomer from ABN AMRO. Please go ahead.
Hi. Good morning, everybody. Three questions, please. The first one is on the development of operating working capital. You mentioned an EUR 85 million impact from postponed payments because of the government relief measures. Should we expect anything for the second quarter as well? My second question is on the organic growth statements that you made. You talked about double-digit growth exiting the quarter, but obviously that is supported by a lot easier comparables. Is the underlying organic growth slightly lower than in January and February, or is that too negative? My final question is on the leverage, 0.2 times, a very healthy balance sheet. Shareholders still have one special dividend to come in September. Can you remind us again what your plans are on managing the balance sheet from a shareholder remuneration perspective, the leverage target of one, pre- and post-IFRS 16? Thank you.
Yeah. Let me start with the first one. Hi, Konrad. Operating working capital. Indeed, in the first quarter, we had a repayment of Social Security charges, where we benefited from extended payment days, in a way. We also talked about that in quarter four. We had expected that to be drawn in December, but it fell into early days of January. Going forward, there might be little stuff, but not really material. Since we go now into sequential growth, of course, we will finance working capital. As you also see now in quarter one, we take a very tight look on the DSO credit management. Therefore, I would expect the normal rhythm of the business kicking in again. Higher growth, more EBITDA, a little bit liquidity to support the growth. Do you want to take the second one?
Yeah, I'll take the second one. Actually, it's reverse, Konrad. Our organic growth compared to last year is actually increasing. That's why we take this to 2019 slide. It's not just because of comps. We're beating the comps, if you will, from January into April. That's why you see the yellow line getting closer to 2019. Whereas, of course, the red line 2020 is totally off the charts. That's also why, for us, we're not looking at 2020 anymore. We're trying to, in a way, beat the comparisons and invest in growth.
Yeah, on the third one, Konrad, not really new news there. Just to reiterate, we made the decision to pay a special beginning of October of EUR 1.62 per share. We're now fully concentrating in delivering another strong years, and then we will make decisions on capital allocation, but nothing to add at this stage.
Okay. Thank you very much.
The next question comes from the line of Hans Pluijgers from Kepler Cheuvreux. Please go ahead.
Yes. Good morning, gentlemen and lady. Two questions from my side. One, let's say, coming back on the question of Marc on the mix change. With respect to compare to 2019, the bridge. I can imagine that especially, let's say, looking at which segment has been growing, especially like, for example, transport and distribution, that likely the mix effect is a little bit negative compared to 2019. Is on average, let's say your wage per temp clearly lower than we have seen in 2019 in your sales. Definitely that way there's slight negative mix impact on the comparison basis. Could you give maybe some flavor on that? Secondly, going back on the U.S., you indicated some negative impact on the margin from some idle time.
Could you give maybe somewhat more feeling on how big the impact was, and so how we should, let's say, see the impact also in Q2, I would suspect in the line trend than the margin.
Hans, good morning. On the U.S., it's a little bit more than just the idle time. It's also COVID pay. You can bill that to a client, but without margin in certain states. There's SUI, state unemployment insurance that, of course, in many markets that has gone up. Many states are indebted, so that goes up. As I said, negative in January, February, I'm not going to give you the details, but March already is normalized a lot. As you can see in the result, it's pretty stable, but I just wanted to flag that. You shouldn't expect too much in the rest of the year of that. The mix change, you're taking out one thing, which is the wage of the temp, but that's not really very relevant for us.
The business that comes in might come in at lower wages per temp or maybe even a lower margin, but it comes in at a higher conversion because we specifically do it through in-house. It is what it is. Compared to 2019, it's a different business. Once we've known the full 2021, we can tell you the difference. The important thing this morning is we're very close in absolute volumes, so to say, to 2019. We think that's a theme. We'll get back to you on that one. We're investing to get it as close as we can, but it's too early to say, like Marc asked, what it will be for the second half of the year, because as always, it's the six weeks visibility.
There are currently no questions in the queue. As another reminder, please press star one if you would like to ask a question.
Good. I think that's it.
There are no further questions in the queue, so I'll hand it back to your host for any closing comments.
Yeah. Thank you very much. Well, happy to share this news with you. I think it's not just good news about Randstad. I think it's good news for all of us. We are the bellwether of the economy, so we're very happy with the fact that we can be this canary in the coal mine with some good news. Thanks for attending, and we hope to see you on the virtual roadshows in the coming weeks. Thank you.
Thanks, everybody.
Thank you for joining today's call. You may now disconnect your lines.