All but preannouncing its FY results, Gary Elden, CEO of UK-headquartered international recruitment firm SThree, said it was “still too early to call a broadly-based recovery” in the economy. The business is expected to confirm a gross profit decline of 5% in the FY to 1st Dec 2013 to £196.7m, mainly due to a 14% GP decline in SThree’s permanent recruitment activities (44% of the total). Contractor GP rose by 4%. SThree is still heavily dependent on ICT recruitment for which GP fell by 10% and represents 43% of the total. However, even non-ICT recruitment GP declined by 1%.
Management has been keen to reduce SThree’s exposure to the UK and to ICT (use to be 100% when the original businesses were founded) but not quite in this manner. Nonetheless, if it weren’t for its international expansion and broadening of recruitment sectors, it’s a pretty good bet that SThree would have found the going very much tougher. We’ll have to wait till early February to see the full picture, but it seems that Elden and his team are not taking much cheer yet from the Chancellor’s prediction of a significant improvement in the UK economy next year (see Autumn Statement 2013 - What a difference a year makes).