Staffline Group PLC on Tuesday said underlying operating profit fell in line with market expectations in 2023 as it aimed to ‘deliver progress into 2024’ despite headwinds.
The Nottingham, England-based recruitment and training firm said revenue grew 1.1% to £938.2 million in 2023 from £928.2 million in 2022.
However, underlying operating profit dropped 16% to £10.1 million from £12.0 million, which Staffline said was in line with market expectations against challenging trading conditions in 2023.
Staffline shares fell 8.3% to 22.46 pence each on Tuesday morning in London.
The company noted a ‘challenging macroeconomic backdrop in the UK’ as it is aiming to ‘deliver progress into 2024 despite widely reported headwinds in the sector.’
Staffline added: ‘In PeoplePlus, political uncertainty, low levels of unemployment and the impact of new contract revenue streams only flowing from 2025/6, will reduce short term profitability by around two thirds, in 2024, versus expectations. The division is, however, now transformed with a more efficient cost base and new management, focusing on its two core markets, Justice and Employability, where it has good market share and strong prospects.’
Further, it said it is confident that it would continue to increase its market share, citing an unfolding economic recovery.
Chief Executive Officer Albert Ellis said: ‘Our healthy balance sheet has enabled us to support organic growth and ensure we delivered labour at scale, to significant customers, such as GXO Logistics, Tesco and M&S during times of seasonal peak demand. I firmly believe there is significant growth potential and, as inflation and pressure on labour markets begin to ease, remain optimistic about the prospects for further organic growth generated from within the group.’
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