LONDON (ShareCast) - (Sharecast News) - Recruiter SThree reported a drop in first-half net fees on Tuesday citing an "ongoing challenging trading environment", but pointed to a modest improvement through the half and maintained its full-year profit guidance.
In the half year to 31 May, group net fees declined 14% to £159.1m amid continued softness in new business across both the contract and permanent segments. SThree said this was partially offset by strong contract extensions.

Net fees in the contract segment fell 14% year-on-year to £133.8m, while permanent saw a 13% decline to 25.2m.

Compared to the first quarter, the contract segment showed sequential improvement in Q2, underpinned by the performance from the US, the company said.

Engineering net fees fell 9% against a record prior year performance, while Life Sciences saw a 15% drop and fees in Technology were down 18%, reflecting continued tough market conditions.

The company said its full-year performance was set to be in line with guidance for pre-tax profit of £25m.

Chief executive Timo Lehne said: "Whilst market conditions remain challenging, the group delivered a stable first half performance, with a modest sequential improvement quarter-on-quarter. Strong contract extensions continue to underpin performance, providing sector-leading visibility and reflecting our customers' priority to retain critical STEM skills.

"We continue to drive operational enhancements to ensure we are well positioned in the best STEM markets and skill verticals, including our internal and go-to-market initiatives in the US which are starting to bear fruit with positive momentum in the region, in line with our expectations. In addition, we are making good progress with the realisation of operational efficiencies, on track with our FY25 plans."

At 1020 BST, the shares were up 8.7% at 243p.

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