(Adds detail, backgroud, shares, CEO, analyst comment)
By Yadarisa Shabong
July 19 (Reuters) - Recruitment company SThree on
Monday forecast annual earnings ahead of current market
estimates after first-half profit more than doubled and said the
pandemic was driving more employers to consider adopting a
hybrid work model.
The group said it was seeing the momentum from the first
half carry on into the second and there was strong placement
activity and contractor retention.
SThree, which provides recruitment services for permanent
and contractor jobs in around 16 countries, also said remote and
hybrid work has opened up a wider talent pool for employers.
Chief Executive Mark Dorman told Reuters that SThree's
clients were thinking carefully about what hybrid means for
them, including what work can be done in office physically or
remotely.
"We're not seeing a big move to have international remote
working as a norm, certainly on the edges that might happen, but
its mostly flexibility as to where people can live regionally,"
Dorman added.
Recruitment companies around the world were hammered last
year as the pandemic brought new hiring almost to a halt. But a
ramp-up in vaccinations and re-opening of some economies have
started encouraging many companies to resume taking on staff.
Pandemic-led restrictions have changed the way people work
and several companies, such as travel company TUI UK and
accounting firm KPMG have announced moves to embrace flexible
working on a permanent basis.
SThree, which is focused on recruitment in science,
technology, engineering and mathematics, reported a 106% jump in
adjusted operating profit for the six months to May 31 to 28.1
million pounds ($38.70 million) compared with 2020. Profit was
also higher than 2019.
For the full-year, SThree expects to perform ahead of
current market consensus, which, on average, estimate net fees
of 332.4 million pounds and underlying profit before tax of 45.4
million pounds.
The group's shares were down more than 2% in line with
Monday's broad market sell-off on fears about the strength of
the economic recovery.
Liberum analysts, which raised their expectation for annual
profit, said the estimates were "cautiously set, allowing for
contractors taking holidays as we emerge out of lockdown."
SThree's upbeat outlook followed similar expectations from
peers PageGroup, Robert Walters and Hays
, which have all boosted their forecast due to a hiring
surge in June.
($1 = 0.7261 pounds)
(Reporting by Yadarisa Shabong and Indranil Sarkar in
Bengaluru; Editing by Rashmi Aich and Jane Merriman)
Robert Walters (RWA)
Hays (HAS)