Profit almost halves at recruiter SThree as Covid-19 strikes

Profit at recruiting giant SThree nearly halved in the six months to the end of May as the coronavirus pandemic ate into the company’s finances.

Pre-tax profit dropped 43% to £13 million in the first half of the financial year, and was down 48% on an adjusted basis.

It came on revenue of £602.6 million, down around 8%.

Bosses said the recruiter had sent as many as 98% of its staff home to work remotely at one point during the pandemic, while the business withdrew its dividend payout to shareholders to save cash.

SThree focuses on recruiting for specialist businesses in the science, technology, engineering and mathematics (Stem) sectors.

Like many other companies, SThree’s first half was split into two very different parts by the outbreak of the virus worldwide.

“These results are a story of two very different quarters and how resilient this business is in the most extreme external environment,” said chief executive Mark Dorman.

“It has been a time of much change and volatility, however two things that have not changed throughout are our purpose and our strategy.”

He said that the company’s involvement in the Stem sectors meant it had been involved in the fight against Covid.

“SThree is alongside a host of businesses that have experienced unprecedented challenges throughout this period, however we are navigating our course,” Mr Dorman said.

“We are confident that our strategy is the right one: Talented people with Stem skills will be those solving the problems that businesses are facing, and those are the candidates we place.”

Liberum analyst Sanjay Vidyarthi said there were “no surprises” in the numbers, but that the third quarter of the year could be tougher than the most recent.

Despite this, SThree is in a decent place, he added, saying: “The balance sheet is solid and can withstand worst case scenarios.”

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