(Reuters) - British recruiter SThree Plc (STHR.L) reported a 9 percent increase in first-quarter gross profit and indicated full-year results would rise, helped by strong demand from the Americas, its fastest growing region.
The company, which owns brands such as Huxley Associates, Progressive and Computer Futures, said it expects good growth across most of its major operational regions.
“The strength of our contract book and improving outlook for permanent give us confidence for the year ahead,” Chief Executive Gary Elden said in a statement.
SThree’s comments comes after larger rivals Hays Plc (HAYS.L) and Michael Page International MPI.L said they expect business to pick up this year.
SThree, which used to recruit largely for information technology customers, has entered markets such as energy and life sciences, both of which are experiencing high demand in the Americas.
The company expects gross profit to rise at least 20 percent this year in the region, Elden told Reuters, adding that a recovery in the banking sector could further boost growth.
That compares with the 49 percent growth in the first quarter ended March 2, a period which is traditionally stronger due to the demand during the holiday season.
The America’s contribution to total profit rose to 13 percent in the quarter, comprising the lion’s shares of the 21 percent contribution to profit from regions outside Europe.
SThree said it also expected strong growth in Asia, particularly from hiring requirements for life science and IT professionals in Tokyo.
The largest chunk of SThree’s profit comes from the UK and Ireland, where profit rose 1 percent in the first quarter.
High demand for recruitment in the energy and life sciences industries saw the two businesses clock profit growth rates of 54 percent and 42 percent, respectively, in the quarter.
At constant currency, SThree’s total gross profit or net fee income - a relevant performance indicator for recruitment companies - rose to 47.8 million pounds ($79.7 million) in the quarter from 44.3 million pounds a year earlier.
The company attributed the rise to higher contract placements, as companies shied away from making full-time hires amid a tentative pickup in Europe.
The recruiter’s stock was up 1.05 percent at 409.50 pence at 1216 GMT on the London Stock Exchange on Friday.
The stock has risen 11 percent since February 3, when the staffing company hinted at a stronger 2014 on the back of a strong contract book and growth in permanent headcount. (link.reuters.com/buh67v)
($1 = 0.60 British Pounds)
Reporting By Esha Vaish and Richa Naidu in Bangalore; Editing by Gopakumar Warrier and Savio D'Souza