SThree Shares Climb: Sees a Positive Close to FY25

SThree shares rose more than 6% on Tuesday morning after the global STEM workforce consultancy said it expects to meet expectations for FY25, reporting performance in line with previously announced profit before tax (PBT) guidance of £25 million, despite a challenging macroeconomic backdrop.

The successful completion of its Technology Improvement Programme (TIP) is expected to drive future efficiencies and scalable growth.

Group net fees saw a 12% year-over-year (YoY) decrease, reflecting a sequential improvement in the rate of decline throughout the year. This was largely underpinned by a return to growth in the US market. Contract net fees, which constitute 84% of the group's total, were down 12% YoY, while permanent placements experienced a 9% YoY decrease.

The contractor order book remained robust at £157 million, representing approximately five months' worth of net fees. The company maintains a strong balance sheet, with net cash of £68 million as of November 30, 2025, after completing a £20 million share buyback earlier in the year.

The completion of the TIP rollout across all 11 markets marks a significant milestone for SThree. This single platform aims to enhance efficiency and position the business for future growth. The company realized net savings in line with its FY25 efficiencies program.

New placement activity improved in the final quarter, reinforcing the company's FY26 PBT guidance. SThree expects profit before tax to be around £10 million for FY26.

Driver Breakdown:

• TIP Rollout: Successful implementation expected to drive operational efficiencies and scalable growth.
• US Growth: The United States returned to growth, offsetting softer performances in other key markets like Germany and the Netherlands.
• Cost Management: The company's FY25 efficiencies program delivered net savings as planned.

According to Timo Lehne, Chief Executive, the company is pleased to report a positive close to FY25, which is expected to be in line with guidance. He noted that the company has exited the year with a period of improving new placement activity, complemented by continued resilient extensions.

A breakdown of regional performance reveals that the DACH region (Germany, Austria, and Switzerland) saw a 16% decline in net fees, while the Netherlands (including Spain) experienced a 21% decrease. The US market, however, showed a 4% increase, while Middle East & Asia saw a 2% rise.

The company reported a headcount reduction of 18% YoY, attributed to careful management of natural churn and a focus on operational efficiencies. SThree plans to provide an update on capital allocation, including the potential for a further share buyback program, when it releases its full-year results in January.