Recruiter posted robust update beating Liberum's forecast, but warned about Brexit uncertainty
Companies: SThree plc
International recruitment group SThree gave a decent Q1 trading update to investors on Friday, saying performance during Q1 had been robust, with its contracts business gaining momentum and its permanent outfit improving. In the past 6 months, SThree has warned several times about the impact of Brexit on its business, so today's update will be welcomed by investors.
The AIM-listed firm said gross profit was flat YoY during the quarter, with robust performance in mainland Europe and strong performance in the USA. US business now represents about a fifth of the Group's gross profit (GP).
However, despite the decent results, the firm again warned about the EU referendum's impact on its UK business, saying it expected performance to be "adversely" impacted by Brexit.
Broker Liberum spoke positively about the update, saying that with the US business performing better than expected, gross profit had been ahead of its expectations.
CEO Gary Elden said that overall, the firm had made a "satisfactory" start to the year, in what is usually its least significant quarter:
Looking ahead, political and macroeconomic uncertainty remains at heightened levels in a number of our key regions. Against this background, we are managing the business prudently and continue to invest in our highest performing teams.
Our focus on Contract, the continued strength of our performance in Continental Europe, our greater momentum in the USA and firm control of our cost base, leave us well positioned for the future.'
Shares in SThree fell marginally as the markets opened on Friday.
