SThree PLC on Tuesday reported a drop in its quarterly net fees and said it expects a lower on-year annual profit.

The London-based staffing company said net fees in the first quarter of 2024 fell 8.7% to £93.7 million from £102.6 million the year before.

This was driven by ‘continued softness’ in new business across Contract and Permanent, which was largely offset by strong Contract extensions.

Contract net fees dropped 4.6% to £78.9 million from £82.7 million in the first quarter of 2023, while permanent net fees fell 26% to £14.8 million from £19.9 million a year ago.

Further, the firm saw net fees drop across several regions, reporting a decrease of 14% in Germany, of 10% in the US and of 7.0% in the UK.

In addition, SThree said its contractor order book fell by around 1.0% to £184 million in the quarter compared to the previous year.

Looking ahead, however, the company said its 2024 performance is currently expected to be in line with market expectations, which forecasts pretax profit of £71.9 million. Pretax profit in 2023 was recorded at £77.9 million.

Chief Executive Officer Timo Lehne said: ‘Once again, we have delivered a good performance against a strong comparative and within a market environment that remains difficult from a new business perspective.

‘We continue to make good progress with our Technology Improvement Programme, with our new end-to-end integrated platform now fully deployed in the US and initiated in Germany, providing our teams with the digital tools which will be key to driving both scale and higher margins over the mid-to-long term.’

Shares in SThree fell 2.5% to 413.50 pence each in London on Tuesday morning.

Copyright 2024 Alliance News Ltd. All Rights Reserved.