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View All NewsSThree revenue down 9%, but reports steady improvement during fiscal year; CFO stepping down
SThree, a provider of STEM staffing, reported revenue fell 9% in constant currency in its fiscal year ended Nov. 30, 2020. The UK-based firm, which has operations in the US, saw its global business impacted by Covid-19 in the second quarter, but it noted steady improvement in the second half. It also announced its CFO is stepping down.
“In 2020 we faced a once-in-a-century event that provided a series of unprecedented tests,” CEO Mark Dorman said. “SThree not only dealt with those challenges but is emerging as a stronger business.”
Dorman noted demand for STEM skills has remained relatively robust.
Results (continuing operations*)
| (£ millions) | FY 2020 | FY 2019 | % change | % change constant currency | FY 2020 (US$ millions) |
| Revenue | £1,202.6 | £1,324.7 | -9% | -9% | $1,600.3 |
| Gross profit (net fees) | £308.6 | £338.0 | -9% | -8% | $410.7 |
| Gross margin | 25.7% | 25.5% | |||
| Profit before tax** | £30.1 | £59.1 | -49% | -49% | $40.1 |
“Despite the negative implications of the Covid-19 health crisis, the group succeeded in improving underlying sequential performance in the second half and delivered a resilient result for the full year,” CFO Alex Smith said. “The demand for contract staff accelerated and our contractor book stabilized due to new deal activity and improved contractor retention rates in the second half.”
Gross profit at SThree fell 8% in constant currency. Looking at just the US, however, gross profit rose by 2% in constant currency. The US represents 25% of gross profit.
The company noted that gross profit in its US life sciences business rose by 16% amid robust demand in clinical operations, product development and quality assurance. Gross profit in its US technology business rose by 9% in constant currency amid increased demand in mobile applications and software development. US gross profit in engineering was up 1% in constant currency.
SThree also announced today that Smith will be stepping down from his role as CFO and board member.
“On behalf of the Group, I would like to take this opportunity to thank Alex for his excellent contribution over the past 12 years,” Chairman James Bilefiled said. “Alex has worked diligently and effectively with both the board and our teams to help make SThree what it is today, astutely guiding the group's entrepreneurial spirit.”
Share price and market cap
Shares in SThree closed up 3.05% to £338.00 (US$462.40) in London; they were 13.89% below their 52-week high. The company had a market cap of £436.1 million (US$596.6 million).
*Continuing operations excludes discontinued operations in Australia.
**Adjusted excludes impact of £500,000 in net exceptional income in 2020 and £2.3 million in net exceptional cost in 2019.