London, UK, July 25, 2023 – SThree plc, the global staffing business focused on roles in science, technology, engineering and mathematics (STEM), has issued its financial results for the half year ending 31 May 2023.

The Group reported a resilient performance, with net fees down 2% YoY on a constant currency basis, compared with a particularly strong post-Covid period in H1 FY22, which saw Year on Year (YoY) growth of 25% against a backdrop of shifting global macro-economic conditions

Financial Highlights

A resilient performance, with Group net fees down 2% YoY on a constant currency basis, against the strong post-Covid comparative period (H1 FY22 YoY growth: 25%) and backdrop of global macro-economic conditions. Across SThree’s three largest countries: Netherlands up 3%, Germany down 1% and USA down 11%, together accounting for 73% of net fees. Growth seen across Technology, up 1% and Engineering, up 17%, while Life Sciences was down 21% driven by global sector trends.

Reflecting both SThree’s strategic focus on flexible talent together with global market conditions, Contract net fees were up 3%, supported by strong extensions, robust pricing and increased contract lengths, while Permanent was down 19%.

Contract net fees represented 81% of Group net fees (H1 FY22: 77%), with the contractor order book value of £190.3 million, which is flat YoY, providing good visibility for the remainder of FY23.

Margin of 18.3% remains above FY22 levels delivering profit before tax of £38.5 million, down 20% YoY (H1 FY22: £44.3 million), due to the planned investment in the Technology Improvement Programme and headcount.

Strong balance sheet, with £72.4 million in net cash as at 31 May 2023 (H1 FY22: £48.4 million).

Interim dividend approved at 5.0 pence per share (H1 FY22: 5.0 pence). SThree intends to remain in line with our dividend policy of cover in the range of 2.5x to 3.0x for the full year.

Technology Improvement Programme on track and on budget, with the integrated platform passing through business user testing with excellent feedback. Key to delivering a differentiated proposition within the market, driving both scale and higher margins over the mid-to-long term. Phased geographical roll out on track to commence in H2 FY23, onto which SThree's bespoke methodologies will be layered to systematise best practice, improve data and workflows.

Sustainable business practice and ESG commitments demonstrated by: Over 17,375 lives positively impacted in H1 FY23 (H1 FY22: 16,540); SThree's renewables business up 29% versus H1 FY22 (H1 FY22: up 22% versus H1 FY21); 44% carbon reduction in FY22(5) in comparison to 2019, our baseline year for our SBTi net zero target; 33% of women (H1 FY22: 30%) in leadership as we progress towards achieving our ambition of 50/50 representation in leadership.

Timo Lehne, Chief Executive, commented:

"Our focus on STEM and flexible talent has delivered a resilient performance in the first half of the year against strong comparatives and macro-economic headwinds. This was underpinned by the Group's strategic focus on Contract, which grew 3%, following robust extensions and pricing as companies commit to holding on to required skills in the face of ongoing acute shortages. We have made excellent progress against the four pillars of our strategy to ensure the business has the right people, structures and processes to support the next phase of our growth. The rollout of our Technology Improvement Programme is on track and on budget, and will be a key enabler in us delivering a unique proposition within the market, driving both scale and higher margins over the mid-to-long term. The macro-economic backdrop remains unpredictable in the short-term, however our established leadership position and progress with our Technology Improvement Programme leaves us more confident than ever in our growth strategy."

About SThree plc

SThree plc brings skilled people together to build the future. It is the only global specialist talent partner focused on roles in STEM, providing permanent and flexible contract talent to a diverse base of over 8,200 clients across 14 countries. The Group's c.2,800 staff cover the Technology, Life Sciences and Engineering sectors. It is part of the Industrial Services sector. It is listed on the Premium Segment of the London Stock Exchange's Main Market, trading with ticker code STEM.

SOURCE SThree plc