SThree sees FY profit touch above top end of market views

Specialist staffing business SThree said on Friday that it expects pre-tax profit for the year to be slightly above the top end of the range of current market expectations of between £37.3m and £39m.

In a trading update for the year to the end of November, the company said group profit was up 2% year-on-year and 6% excluding the energy business.

SThree said it saw strong growth in Continental Europe, ICT and Engineering, but overall growth in gross profit slowed during the year, affected by the ongoing weak activity in the energy market, a continuation of the more difficult market conditions in banking and finance, EU referendum uncertainty and public sector reforms in the UK.

Against this backdrop, the group restructured some of its businesses in the first half and became more selective in its investments in response to the increasingly challenging market conditions.

Profit in the UK and Ireland fell 12% in the fourth quarter.

Chief executive Gary Elden said: “We have delivered a solid overall performance for the year, in the face of mixed trading conditions. Our Contract business continued to perform well, with gross profit increasing by 8% year-on-year and with contract runners reaching in excess of nine thousand, a milestone for the group. Continental Europe once again grew strongly, underpinned by a very pleasing performance in DACH, where gross profit was ahead by 17% year on year.

“Looking ahead to 2017, global political and macro-economic uncertainties have increased across a number of our key regions. We are managing the business prudently in the light of these market conditions, and continue to invest in our highest performing teams. The momentum of our contract business, the strength of our performance in Continental Europe and the benefit of restructuring measures taken earlier in the year, leave us well-positioned for the future.”

At 0945 GMT, the shares were up 2.6% to 282p.