Staffline shares jump as 2024 profits top forecasts
By Benjamin Chiou
Date: Tuesday 04 Feb 2025
(Sharecast News) - Staffline's share price jumped by a quarter on Tuesday after the recruitment and training firm exceeded market expectations with its results for 2024, though the trading outlook pointed to ongoing challenges.
In a pre-close trading update, the company said it generated an underlying operating profit of £11.1m for the 12 months to 31 December, up 7.8% from 2023 and comfortably ahead of the £10.1m consensus estimate.
Revenues were 12.8% higher at £1.06bn, reflecting market share gains despite a "challenging market" for recruitment and training, Staffline said.
Meanwhile, the company ended the year with a net cash position of £4.4m, compared with net debt of £0.7m the year before, surprising analysts who had pencilled in net debt of £0.6m.
In the Recruitment GB division in particular, while weak retail sales and declining demand for temporary workers impacted results in certain sectors, the company saw strong demand from third-party outsourcing and large supermarket customers like Tesco, Sainsbury's and M&S, as well as the logistics sector.
Looking ahead, 2025 will be impacted by "ongoing macroeconomic uncertainty", Staffline said, with upcoming increases in employer contributions to national insurance impacting demand. Meanwhile, with interest rates likely to stay higher for longer than originally expected, working capital costs will increase more than previous estimated.
In the PeoplePlus division, short-term results will be weighed down by "prolonged delays in public sector bid announcements", with the company awaiting results from bids worth £190m of revenue in England and Wales.
"Staffline remains a trusted strategic partner across a number of key sectors, both in the UK and Ireland, and I am confident that despite the challenging backdrop, our track record in continuing to increase market share will continue to support growth in 2025," said chief executive Albert Ellis.
The stock was up 24% at 23.3p by 0854 GMT, more or less offsetting share-price losses seen so far this year.
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