SThree confirms a resilient performance in H1 FY23 driven by its contract business

Group net fees down 2% YoY while contract net fees are up 3% YoY with growth in the majority of regions.

SThree plc, the global STEM-specialist talent partner, announced its trading update for the half year ending 31 May. Group net fees are down 2% (on a constant currency basis) compared with the same period in FY22, while Contract net fees – which represent 81% of total Group - rose 3% over the same period.

Permanent net fees were down 19% YoY, reflecting both market conditions and tough comparatives, particularly in life sciences, together with strategic investment towards contract in specific markets. In the largest three markets, which represent 73% of net fees, the Netherlands grew 3%, while Germany was down 1% and USA was down 11%.

Skills-based fee performance saw Technology increase by 1% and Engineering by 17%, while Life Sciences decreased by 21%, driven by global sector trends.

The contractor order book remained flat YoY as robust extensions offset new placement activity.
The Group’s balance sheet is strong with £72m net cash as at 31 May 2023 compared with £48m on 31 May 2022.

SThree’s Technology Improvement Programme is on track and within budget. A sequenced rollout will begin across the Group later this year.

Timo Lehne, Chief Executive Officer, commented:

“The Group has delivered a robust net fee performance in the first half of FY23 with fees down 2% YoY on a constant currency basis against the strong post-Covid performance in H1 of FY22. On a reported basis net fees were up 3% as we benefited from FX tailwinds. The macro-economic environment has remained uncertain with varied effects across our markets impacting new placements. However, a continued healthy extensions performance has seen our Contract business (now representing 81% of Group net fees) grow 3% as our clients remain committed to retaining highly sought after skills. This demonstrates the strength of our well-established strategy, focused on STEM and flexible talent.

We are delighted with the strategic progress we have made, centred on an analytical and fact-based approach of knowing where to play and playing where we can win. Our highly disciplined and targeted investment in talent acquisition within Contract remains a priority for the business. Our Technology Improvement Programme is on track and on budget and is key to delivering a differentiated proposition within the market, driving both scale and higher margins over the mid-to-long term.

Our long-term opportunity is unchanged, underpinned by structural megatrends which drive the acute need for scarce STEM talent. In the short term we remain responsive to the macro backdrop and how that plays out on the mix of new placements and extensions, while tightly managing costs. Supported by a resilient business model and robust financial position, we remain well positioned to source and place the best STEM talent the world needs and will be in a position of strength once the macro-economic environment eases.”



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Notes to editors

SThree plc brings skilled people together to build the future. We are the only global STEM specialist talent partner focused on roles in Science, Technology, Engineering, and Mathematics (‘STEM’), providing permanent and flexible contract talent to a diverse base of over 8,200 clients across 14 countries.

Our Group’s c.2,800 staff cover the Technology, Life Sciences, and Engineering sectors. SThree is part of the Industrial Services sector. We are listed on the Premium Segment of the London Stock Exchange’s Main Market, trading with ticker code STEM.


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