Staffline buoyed by demand from food sector over Christmas break

PA

Recruiter Staffline was boosted by high demand from food sellers for extra staff over the Christmas period.

The company said that its food retail customers had lapped up its services despite the English national lockdown in November and restrictions in December.

It led to a “strong Christmas trading peak”, Staffline said.

It added: “Furthermore, e-commerce and logistics experienced a very strong trading period as a result of consumers transitioning to online retail.”

These trends were broadly continuations of what had gone before in 2020.

Demand for temporary workers was strong from the food, driving, logistics and e-commerce sectors throughout the year.

These were the businesses that many Brits turned to during lockdown, as they were able to operate more safely during the pandemic, or because they were considered so vital that they were not forced to close during lockdowns.

Meanwhile, the manufacturing, retail and automotive industries “continued to be more challenging”, Staffline told investors on Monday.

The news earned Staffline an upgrade from analysts at Liberum, whose price target for the company’s shares was increased on Monday morning from 40p to 60p.

But this was hardly visible in the company’s share price. After soaring by 7.5% just after markets opened in London, the price quickly dropped again and was trading down 0.8% at around 11am.

The company said that its underlying operating profit for 2020 will be slightly ahead of expectations.

It also revealed that it paid down net debt from £59.5 million to £9 million in the year to the end of December 31.

This was in large part because of £42.9 million of benefits from the Government deferring VAT relief.

The company added: “Staffline delivered a robust performance across 2020, underpinned by the new structures and processes implemented during the year. These initiatives have provided stability and ultimately position the group for growth; however, the board is mindful that the near-term challenges created by the Covid-19 pandemic remain.

“The employment market experienced a structural shift in 2020, with the pandemic causing a significant rise in UK unemployment, which the board believes presents a number of opportunities for Staffline due to existing customer relationships and the group’s broad market offering.”

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