December 15, 2017 / 7:43 AM / a year ago

SThree sees profit above consensus on Europe, U.S. boost

(Reuters) - British recruiting firm SThree Plc (STHR.L) said on Friday adjusted full-year pretax profit was expected to slightly exceed market consensus, helped by strength in Continental Europe and the energy-market linked business in the United States.

The adjusted pretax profit consensus is 43.8 million pounds for the year ended on Nov. 30, with a forecast range of 42 million pounds to 45.6 million pounds, SThree said.

Gross profit at the energy-market linked business surged 25 percent for the year, at constant currency, while life sciences profit rose 7 percent, the company said.

“As well as a solid performance from Life Sciences and Engineering, the quarter saw an extremely strong contribution from the energy business,” Liberum analysts wrote in a note. The brokerage rates the stock “buy”.

“The latter was supported by a recovery in oil & gas prices, which disproportionately helped the U.S. business.”

SThree, which places people with financial, energy, banking and pharmaceutical companies, said group gross profit for the year rose 4 percent at constant currency.

Gross profit is a key indicator for staffing firms as it represents total fees earned from all recruitment work.

Upbeat comments from SThree follows that from peer Robert Walters Plc (RWA.L) which, on Tuesday, predicted annual earnings would exceed market expectations on strong trading.

Shares of SThree rose nearly 1 percent to 360 pence in London as of 0809 GMT.

Reporting by Radhika Rukmangadhan in Bengaluru; Editing by Gopakumar Warrier and Amrutha Gayathri

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