SThree lifts FY profit expectations after improvement in US, German businesses

(Sharecast News) - Recruiter SThree lifted its full-year profit expectations on Monday as it hailed an improvement in its US and German businesses.
The company, which specialises in science, technology, engineering and maths (STEM), said it now expects pre-tax profit for the year to the end of November to be "marginally above" the top end of the range of market expectations of between £23.2m and £27.7m.

SThree said there had been "a notable improvement" in the performance of the US and German businesses despite the pandemic, with high levels of demand in Life Sciences and Technology through October and early November.

Chief executive officer Mark Dorman said: "I am pleased to report that trading in the final quarter of the year is coming in ahead of expectations, with our purpose of 'bringing skilled people together to build the future' and our strategy focused on STEM skills and flexible working continuing to serve us well.

"This performance has been driven by hard work and dedication from our teams throughout the business, alongside learning to operate better in whatever environment we are in. This has enabled us to capitalise on current opportunities and to continue to build a strong platform for the future. With this confidence in our purpose and strategy, we will continue to execute against our plans as we look to deliver the group's long-term ambitions."

House broker Liberum bumped up its FY20 pre-tax profit estimate by 16% to £28.1m on the back of the update and its FY20 net fee income estimate by 1% to £307m.

"SThree remains our top pick among the professional recruiters, reflecting its strong, defensible position in the STEM and flexible working markets," it said, increasing its price target on the buy-rated stock to 450p from 420p.