Gary continues, “Our strategic approach of diversifying by region and sector, with a key focus on growing our Contract business, has added resilience to our earnings, enabling us to weather the political and economic uncertainties that we have faced through 2016.”
Our business mix continued to shift in favour of Contract, a business where we continue to see attractive growth opportunities and one which is also more resilient in times of uncertainty.
Contract and Permanent
We have now achieved a 67% split in favour of Contract, a growth of 3% YoY. The Permanent side of our business now represents 33% of Group GP, in line with our stated strategy of retaining a well-diversified business. We believe that this balance towards Contract continues to represent the best long-term approach for the company and, during 2017, we expect that Contract will continue to grow as a percentage of total Group GP, while we also maintain our sharp focus on improving yields and selectively growing headcount in Permanent.
At a regional level, the Group continues to become ever more international, with 75% of Group GP now derived from markets outside its historic base in the UK. Our strongest performances included Continental Europe (up 13%*), where very strong client and candidate delivery by our teams ensured we capitalised on a buoyant market.
During 2016 we expanded our US footprint by opening offices in Austin and Minneapolis as well as by launching Madison Black, a specialist digital marketing brand, in New York.
We have also laid the foundations for further growth within our existing regions by adding office capacity in some key locations and preparing for additional moves and new office openings in 2017. At the same time we continue to manage costs and contractual commitments carefully.
Gary says, “Looking ahead, the heightened level of political and economic uncertainty remains the primary feature of our trading outlook. Against this backdrop we will continue to focus on the Contract market, where we see attractive growth opportunities and which is more resilient in periods of economic uncertainty. As we have done in 2016, we will pay close attention to productivity and underlying costs.”
“We have shown in previous periods of uncertainty that we can optimise our performance. We will retain a prudent approach to planning and selective investment in growth, while preserving the agility to respond quickly to market opportunities as they arise, in the year ahead,” says Gary.
To view the SThree Annual Report and read the full year results announcement, visit the SThree investor’s page here.