Dec 16 (Reuters) - Recruiter SThree reaffirmed its annual profit forecast on Tuesday, as the U.S., a key market, returned to growth after two years, even as a prolonged downturn in other major markets
SThree Shares Surge with US Market Rebound, Guidance Confirmed
Dec 16 (Reuters) - SThree's annual fee income in the United States, its second-biggest market, rose for the first time in three years, sending the recruiter's shares up as much as 9% on Tuesday as it reaffirmed profit forecasts for this year and next.
The U.S., which accounts for about a fifth of SThree’s net fee income, has seen an improvement in contractual hiring, helping the company post a 2% rise in fees there for the year to November and buck declines in other major regions.
Persistently weak global hiring conditions are weighing on business confidence in markets such as Germany, SThree’s largest, with employers delaying new roles and putting pressure on recruitment services.
Overall, SThree's net fee income fell 12% to 322.7 million pounds ($431.3 million), with Germany and the Netherlands posting double-digit declines. U.S. growth was driven by demand in energy and finance.
The recruiter, which specialises in science, technology, engineering and mathematics roles, has been seeking to boost profits through cost cuts, including increased investment in artificial intelligence to drive efficiencies.
"As anticipated, we have not yet seen a widespread market recovery. However, we have exited the year with a period of improving new placement activity, complemented by continued resilient extensions," CEO Timo Lehne said in a statement.
SThree's improved U.S. prospects - despite U.S. President Donald Trump's crackdown on work visas and the broader uncertainty created by his trade policies - lifted shares across the UK recruitment sector.
At 0940 GMT, SThree shares were up 7.9%, while Pagegroup was up 2.1% and Hays up 1.3%.
Berenberg analysts said they continue to expect SThree’s longer-term outlook to be attractive as markets normalise and its efforts pay off.
SThree has forecast pretax profit of about 25 million pounds in fiscal 2025, and about 10 million pounds in fiscal 2026.
($1 = 0.7482 pounds)
(Reporting by Nithyashree R B and Simone Lobo in Bengaluru. Writing by Pushkala Aripaka. Editing by Sumana Nandy and Mark Potter)
