Three things you need to know as the UK financial markets open, from Tony Cross.
#1. SThree Q3 update sees headwinds sustained, UAE stands out for growth
We have a Q3 update from SThree LON:STEM, the science and technology recruitment company, out this morning. A continued backdrop of challenging market conditions has seen fee income drop 8% against the comparative and whilst the balance sheet is depressed from the position a year ago, management see this as being a timing of client payments issue so expect a quick reversion here. Full year performance is still expected to be in line with market expectations. The decline in performance is fairly evenly balanced across the globe, but a meaningful uptick in activity in the UAE – admittedly off a low base – is notable.
#2. Revenues up at Card Factory but costs hammer profits
Interims from Card Factory LON:CARD have been published with revenues up 6%, but higher costs including wages and freight have taken a toll on profits. Trading since the year end has remained in line with expectations and management note several factors that should help in H2, including falling inflationary pressures and the underlying seasonality of the business. Full year performance remains on track, as does the longer range outlook, but will the sharp dip in profits spook investors?
#3. Meaningful growth at 3i despite macro backdrop
Portfolio investors 3i LON:III have issued an update on their holdings today, noting that year to date sales are 21% up on the same position 12 months ago, whilst EBITDA over the last year is EUR1880m, against EUR1530m for the comparative. Given the ongoing weak macroeconomic backdrop across Europe, these numbers arguably look upbeat.