REG - SThree plc - FY26 Q1 Trading Update

SThreeAnnouncement

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RNS Number : 8606W  SThree plc  17 March 2026

17 March 2026

 

SThree plc

 

FY26 Q1 Trading Update

 

Stable performance as anticipated, FY26 expectations reiterated

 

 

SThree plc ("SThree" or the "Group"), the global STEM workforce consultancy,
today issues a trading update covering the period 1 December 2025 to 28
February 2026.

 

Q1 Highlights

 

 ·             Group net fees down 8% YoY((1)), reflecting continued stabilisation, supported
               by ongoing growth in the USA and Japan, and a significant improvement on the
               prior-year rate of decline.
 ·             Key contract renewal period concluded and new business activity broadly
               consistent year-on-year, with both performing in line with expectations.
 ·             Contract (83% of net fees) declined 10% YoY, whilst Permanent was flat YoY.
 ·             Contractor order book((2)) of £152 million (down 7% YoY) continues to
               represent sector-leading visibility with the equivalent of circa five months'
               net fees.
 ·             Robust balance sheet with net cash of £51 million at 28 February 2026 (28
               February 2025: £45 million).
 ·             Share buyback programme of up to £20 million launched in February, with £1.6
               million purchased as at 16 March 2026.
 ·             FY26 cost optimisation programme progressing as planned, with costs to deliver
               weighted to H1 and savings expected from H2.
 ·             Performance for FY26 expected to be in line with the previously announced
               c.£10 million PBT guidance((3)).

 

Timo Lehne, Chief Executive, commented:

 

"Trading in the first quarter of FY26 has started in line with expectations,
with continued stability across our business and encouraging momentum in
select markets, notably the USA and Japan. New business activity was
consistent with the prior year, which is particularly encouraging given a
lower sales headcount, demonstrating improved productivity and operational
efficiency. This performance was achieved against a backdrop of ongoing
macroeconomic volatility, including geopolitical uncertainty and rapid
technological change, which continues to influence business priorities and
investment decisions.

As workforce needs evolve, clients are increasingly seeking partners capable
of managing the growing complexity of workforce solutions, a shift heightened
by advances in AI. This trend is strengthening alignment with our proposition
and is reflected in the resilience of the Employed Contractor Model (ECM), as
organisations prioritise scalable, end‑to‑end workforce management over
transactional hiring.

Our proposition is aligned to long‑term STEM workforce demand and is
supported by a strong balance sheet and a scalable operating platform, with a
unified digital and data backbone that enables us to innovate and deploy new
technology at pace. Whilst remaining cognisant of the macro environment, we
look ahead with cautious optimism."

 

Business performance highlights

 

Group net fees were down 8% YoY, with trading conditions remaining largely
unchanged from the previous quarter. Contract net fees declined 10% YoY. New
placement activity was broadly stable year-on-year and in line with
expectations, despite a mid-teens percentage reduction in sales headcount.
This reflects a strong improvement in productivity compared with the prior
year, supported by the new technology platform. Contract extensions also
continued to show resilience through the key renewal period and delivered as
expected. The USA was a notable highlight in the quarter, with Contract net
fees up 13% YoY, partially offsetting a weaker performance in the Netherlands.

Our Permanent business was flat YoY, supported by a strong performance from
Japan. New placement activity was also broadly stable year-on-year.

Within our skill verticals, Engineering declined 5% YoY, although the Energy
segment continued to grow, up 8%, driven by strong demand for roles in the
USA. Life Sciences net fees were down 10% YoY, as strong growth in Japan only
partially offset reduced demand across our other major markets. Technology saw
a decline of 14% YoY, reflecting soft demand for roles, particularly in the
Netherlands and Germany.

Among the Group's three largest markets, which accounted for 73% of net fees,
growth in the USA was underpinned by strong demand for skills in Technology
and Energy. In Germany, performance was largely driven by demand for
Technology skills. In the Netherlands, which sustained positive performance
for longer than our other larger countries, results continue to be compared
against strong prior-year comparatives, particularly in its two largest skill
verticals, Technology and Engineering.

Group period end headcount was down 4% from the end of the last financial year
attributable to the careful management of natural churn, whilst being highly
selective about where we choose to hire, and the realisation of cost
optimisation actions.

 

                                  Q1       Q1          Q1 2026              Q4 2025           Q3 2025             Q2 2025           Q1 2025
 Net fees                         2026     2025        YoY ((1))            YoY ((1))         YoY ((1))           YoY ((1))         YoY ((1))
 Contract                         £59.8m   £65.8m      -10%                 -9%               -13%                -13%              -15%
 Permanent                        £11.9m   £12.6m      0%                   -2%               -5%                 -13%              -13%
 GROUP                            £71.7m   £78.4m      -8%                  -8%               -12%                -13%              -15%

 Regions
 DACH ((4))                       £23.7m   £26.2m      -13%                 -14%              -21%                -16%              -14%
 USA                              £19.5m   £19.4m      8%                   8%                17%                 0%                -9%
 Netherlands (incl. Spain) ((5))  £13.0m   £16.2m      -23%                 -12%              -31%                -24%              -16%
 Rest of Europe ((6))             £11.1m   £12.6m      -14%                 -15%              -16%                -17%              -18%
 Middle East & Asia ((7))         £4.4m    £4.1m       27%                  7%                22%                 9%                -26%
 GROUP                            £71.7m   £78.4m      -8%                  -8%               -12%                -13%              -15%

 Top five countries
 Germany                          £21.5m   £23.1m      -11%                 -13%              -21%                -14%              -13%
 USA                              £19.5m   £19.4m      8%                   8%                17%                 0%                -9%
 Netherlands                      £11.0m   £14.6m      -28%                 -17%              -35%                -26%              -18%
 UK                               £5.8m    £6.9m       -17%                 -26%              -27%                -27%              -30%
 Japan                            £3.3m    £2.3m       57%                  33%               20%                 34%               -7%
 ROW ((8))                        £10.6m   £12.1m      -14%                 -7%               -1%                 -13%              -12%
 Group                            £71.7m   £78.4m      -8%                  -8%               -12%                -13%              -15%

 Service mix                      Q1 2026  Q1 2025
 Contract                         83%      84%
 Permanent                        17%      16%

 Skills mix                       Q1 2026  Q1 2025
 Technology                       44%      46%
 Engineering                      30%      30%
 Life Sciences                    16%      17%
 Other                            10%      7%

 

 

((1)) All YoY growth rates expressed at constant currency.

((2)) The contractor order book represents the value of net fees until
contractual end dates, assuming all contractual hours are worked.

((3)) As guided on 16 September 2025, the Board expects FY26 profit before tax
to be c.£10 million.

((4)) DACH - Germany, Austria and Switzerland.

((5)) Netherlands (incl. Spain) - Netherlands and Spain, which is managed from
the Netherlands.

((6)) Rest of Europe - UK, Belgium, France.

((7)) Middle East & Asia - Japan and UAE.

((8)) ROW - All other countries we operate in.

 

 

Analyst conference call

 

SThree is hosting a conference call for analysts and investors today at 8.30am
to discuss the FY26 Q1 Trading Update. If you would like to register for the
conference call, please contact SThree@almastrategic.com.

 

The Group will issue its trading update for the six months ended 31 May 2026
on 16 June 2026.

 

 Enquiries:

 SThree plc
 Timo Lehne, CEO

 Andrew Beach, CFO

 Charlie Hildesley, Investor Relations Manager   investorrelations@sthree.com

 Alma Strategic Communications                   +44 20 3405 0205

 Rebecca Sanders-Hewett                          SThree@almastrategic.com

 Hilary Buchanan

 Sam Modlin

 Rose Docherty

 

 

Notes to editors

SThree plc brings skilled people together to build the future. We are the
global STEM workforce consultancy, placing highly skilled, STEM specialist
workers in the industries where they are needed most. We advise businesses,
build expert teams, and deliver project solutions for our clients. With 40
years of experience in pure-play STEM and a global team with local expertise
across 11 countries, we cover high-demand skills across Engineering, Life
Sciences and Technology roles.

 

We provide permanent and flexible contract talent to a diverse base of around
6,000 clients. By combining advanced technology with expertise, we push beyond
traditional boundaries to deliver tailored solutions, leveraging data and
insight from our world-class operating platform.

 

Outpace tomorrow, together

 

 

Important notice

Certain statements in this announcement are forward looking statements. By
their nature, forward looking statements involve a number of risks,
uncertainties or assumptions that could cause actual results or events to
differ materially from those expressed or implied by those statements. Forward
looking statements regarding past trends or activities should not be taken as
representation that such trends or activities will continue in the future.
Certain data from the announcement is sourced from unaudited internal
management information and is before any exceptional items. Accordingly, undue
reliance should not be placed on forward looking statements.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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