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UK – Energy business fuels profits at SThree

30 November 2012

Specialist staffing firm SThree (LSE:STHR) reported on Friday that gross profit for the full year ended this month rose by +8% to £205.4 million while Q4 profits were up +2%. The firm saw strong growth in energy & engineering, as well as pharmaceuticals & biotechnology sectors. 

Chief executive Russell Clements, due to retire next month after 26 years with the firm, said: “Our contract division, which makes up half of gross profits, reported another resilient performance and remains a key area of strategic focus.

“Energy & engineering and pharmaceuticals & biotechnology, which between them make up about one third of gross profits, continued to experience strong demand. These businesses are making an increasingly significant contribution both to group performance and to our ongoing geographic diversification, with nearly two thirds of fee income now being generated outside the UK & Ireland.”

Contract recruitment grew gross profit in all regions to a total of £101.8 million in the full year, up +11% from a year ago. In the UK & Ireland, gross profit increased by +3% year-on-year. In continental Europe, this figure was up +9% and +98% in the Rest of World.

Gross profit derived from permanent recruitment increased by +6% to £103.7 million in the full year, but declined by -5% in Q4 due to a slowdown in the Benelux countries, France and the UK & Ireland. Germany and the Rest of the World division saw stronger growth and helped offset the decline in other regions.

The Group opened new offices in Oslo, San Diego, Rio de Janeiro and Brisbane during the year expanding their international network to 64 offices in 18 countries, of which 42 are outside the UK. Non-UK & Ireland business now represents 65% of the company’s gross profit (2011: 64%).

As previously announced, Gary Elden will succeed Russell Clements as CEO with effect from 1 January 2013, at which point Mr Clements will retire from the Board.

SThree, which is among the 40-largest staffing companies in the world, specialises in ICT, banking, engineering and pharmaceutical sectors.

In early trading, the company’s share price rose by +0.7% to 315.75 pence, up +30.2% from a year ago and -9.2% below its 52-week high of 347.75 pence seen in May. SThree has a market value of £380.05 million, making it the world’s 18th largest listed staffing firm by market capitalisation.


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