Earnings release
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RNS Trading Statement TRADING UPDATE STHREE PLC Released 07:00:06 12 December 2024 RNS Number : 7714P SThree plc 12 December 2024 12 December 2024 SThree plc Trading Update FY24 performance in line, challenging conditions persist Intention to launch share buyback programme of up to £20 SThree plc ("SThree" or the "Group"), the only global specialist talent partner focuse Technology, Engineering and Mathematics ('STEM'), today issues a trading update for the November 2024. Full Year Highlights · Group net fees for the full year down 9% YoY(1) against the backdrop of ongoi conditions, with Contract down 7%, representing 84% of net fees. 2024-12-12 10:02 Trading Update - 07:00:06 12 Dec 2024 - STEM News article | London Stock Exchange https://www.londonstockexchange.com/news-article/STEM/trading-update/16807739 1/6
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· Contractor order book(2) down 10% YoY to £161 million, whilst continuing to re visibility (c.4 months of net fees). · Robust balance sheet with net cash of £70 million at 30 November 2024 (30 million). · Technology Improvement Programme (TIP) remains on track with deployme Group's largest markets, and latest roll-out in the Netherlands initiated this quart and the deployments in Germany and Netherlands progressing as anticipated. · Performance for FY24 expected to be in line with market expectations(3). Outlook · Whilst the Group continues to expect robust contract extensions, new business a throughout FY24 driven by the protracted challenging economic conditio performance. The latter part of FY24 saw increased political and macro- particularly in Europe, further delaying decision making and the anticipat conditions. · The Board is now making the prudent assumption that these challenges will pe impacting net fees. · Following early efficiencies from the TIP and insights into its full potential, we no to accelerate the realisation of further operational efficiencies to reduce the fi these challenges which will drive in year net savings of c.£6m. · The Board now expects FY25 profit before tax to be c.£25m which includes up t to deliver the additional operational efficiencies. · The Board remains confident that the Group's strategic focus on STEM and C rollout of the TIP, alongside the actions being taken, will position the Group fo growth when markets recover. Intention to launch a share buyback programme · SThree announces its intention to launch a share buyback programme of up to £ over the next six months. · In light of SThree's cash generation and strong balance sheet, the Board conside the buyback, in line with its stated capital allocation policy. · Following completion of the buyback programme the Group expects to retai reflecting the overall capital needs of the business. Timo Lehne, Chief Executive, commented: "As has been widely reported across our industry, the past year has been characterised by market conditions which have impacted new business activity. Nonetheless, we continued extensions through the year which demonstrates the value our customers place on the provide and the skills on which they rely to power their organisations. It is our specialism combined with careful cost management, that has delivered a resilient performance, with line with market consensus. 2024-12-12 10:02 Trading Update - 07:00:06 12 Dec 2024 - STEM News article | London Stock Exchange https://www.londonstockexchange.com/news-article/STEM/trading-update/16807739 2/6
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"There is no doubt that the labour market is undergoing changes driven by new techno working. We recognised these megatrends early which has informed both our strategy to t where we see structural growth, being STEM and Contract, but also our own approach t opportunities. Our Technology Improvement Programme is a core component of where term opportunity, and its phased implementation which continues to progress to plan, un financial position, takes us closer to our digital-first vision. "The nature of our business model has meant we have been able to withstand the extern However, the anticipated easing of market conditions has not yet materialised, with de continuing to impact new placement activity whilst Contract extensions remain robust. With to persist through next year, the Board has taken a prudent view of FY25. We nonetheles we have the right strategy, an energised team, and a robust technology platform which is b as we roll-out additional functionality, leaving us well placed for when market conditions imp Business performance highlights In challenging market conditions Group net fees were down 9% YoY reflecting the con business across Contract and Permanent, partially offset by strong Contract extensions. The Group's Engineering net fees for the full year, were down 1% against a record p Technology and Life Sciences performance reflected the tough market conditions throughou 10% and 17% respectively. Regionally, the Group delivered net fee growth in the Middle East and Asia, underpin performance in Japan. Challenging macro-economic conditions resulted in declines ac largest markets, which now represent 72% of net fees. The performance in Germany r demand for Technology skills. Our USA performance was impacted by declines in Life Sc partially offset by a solid Engineering performance, whilst the Netherlands saw lower Technology and Engineering skills versus record levels in the prior year. Group period-end headcount was up slightly from the end of the last financial year. FY FY FY 2024 Q4 2024 Q3 2024 Net fees 2024 2023 YoY (1) YoY (1) YoY (1) Contract £310.6m £343.6m -7% -12% -8% Permanent £58.5m £75.3m -18% -26% -9% GROUP £369.1m £418.8m -9% -15% -8% Regions DACH (4) £127.5m £148.9m -12% -18% -8% Netherlands (incl. Spain) (5) £78.5m £82.1m -2% -10% -10% Rest of Europe (6) £61.3m £70.4m -12% -14% -13% 2024-12-12 10:02 Trading Update - 07:00:06 12 Dec 2024 - STEM News article | London Stock Exchange https://www.londonstockexchange.com/news-article/STEM/trading-update/16807739 3/6
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USA £82.0m £96.4m -12% -13% -10% Middle East & Asia (7) £19.7m £20.9m +4% -18% +20% GROUP £369.1m £418.8m -9% -15% -8% Top five countries Germany £111.8m £130.9m -12% -17% -7% Netherlands £71.0m £77.1m -6% -13% -15% UK £38.3m £45.0m -14% -21% -17% USA £82.0m £96.4m -12% -13% -10% Japan £10.6m £9.3m +26% -1% +60% ROW (8) £55.4m £60.2m -6% -12% -6% Group £369.1m £418.8m -9% -15% -8% Service mix FY 2024 FY 2023 Contract 84% 82% Permanent 16% 18% Skills mix FY 2024 FY 2023 Technology 48% 48% Life Sciences 17% 18% Engineering 29% 26% Other 7% 8% (1) All YoY growth rates expressed at constant currency. (2) The contractor order book represents value of net fees until contractual end dates, assuming worked. (3) Current consensus PBT expectation is £67.4m for FY24. Source: SThree compiled consensus. (4) DACH - Germany, Austria and Switzerland. (5) Netherlands (incl. Spain) - Netherlands and Spain, which is managed from the Netherlands. (6) Rest of Europe - UK, Belgium, France. (7) Middle East & Asia - Japan and UAE. (8) ROW - All other countries we operate in. Analyst conference call SThree is hosting a conference call for analysts and investors today at 8.30am to discuss you would like to register for the conference call, please contact SThree@almastrategic.com Forward looking dates The Group will present its results for the financial year ended 30 November 2024 on 28 Jan 2024-12-12 10:02 Trading Update - 07:00:06 12 Dec 2024 - STEM News article | London Stock Exchange https://www.londonstockexchange.com/news-article/STEM/trading-update/16807739 4/6
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Enquiries: SThree plc Timo Lehne, CEO Andrew Beach, CFO Keren Oser, Investor Relations Director via A Alma Strategic Communications +44 Rebecca Sanders-Hewett Hilary Buchanan Sam Modlin Will Ellis Hancock SThre This announcement contains inside information for the purposes of Article 7 of the Market person responsible for arranging the release of this announcement on behalf of SThree Company Secretary. Notes to editors SThree plc brings skilled people together to build the future. We are the only global s focused on roles in Science, Technology, Engineering and Mathematics ('STEM'), providing contract talent to a diverse base of around 6,000 clients across 11 countries. Our Group's Technology, Life Sciences and Engineering sectors. SThree is part of the Industrial Servic on the London Stock Exchange's Main Market, trading with ticker code STEM. Important notice Certain statements in this announcement are forward looking statements. By their nature, forward looking statements involve a assumptions that could cause actual results or events to differ materially from those expressed or implied by those stateme regarding past trends or activities should not be taken as representation that such trends or activities will continue in th announcement is sourced from unaudited internal management information and is before any exceptional items. Accordingly, un on forward looking statements. - Ends - 2024-12-12 10:02 Trading Update - 07:00:06 12 Dec 2024 - STEM News article | London Stock Exchange https://www.londonstockexchange.com/news-article/STEM/trading-update/16807739 5/6
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