Three developing stories at the UK stock market open.
1. Headwinds persist for science recruiter SThree
There’s a Q1 trading update out from the specialist recruiter SThree LON:STEM which again notes continued headwinds faced by the business with fee income down 15% as challenging market conditions persist. That’s an even split between contract and full time placements and although there is some stress on cash levels, management point to the share buyback and the move to a new payment systems as contributing to the downside here.
Cost saving plans remain in progress and the rate of decline in the company’s largest markets is slowing but this remains a challenging proposition in the short term.
2. Modest revenue uptick for Computacenter, strong momentum noted
Computacenter LON:CCC issued full year numbers today with revenues up 2.9% and gross profits 1.2% higher. Adjusted operating profits came in as previously guided at the very bottom end of analyst forecasts but management note that there’s good momentum being seen despite the broader macroeconomic uncertainty and further progress is expected in the year ahead. Dividends are being maintained at 2023 levels.
3. Motor finance saga continues to challenge Close Brothers
Interim numbers are out from lender Close Brothers [LON:CLB] where the bank notes operating income down 1% whilst an increase in impairment charges saw operating profits fall by a more pronounced 15%.
Add to that the £165m worth of provisions made in relation to the ongoing motor finance saga plus associated legal costs and that’s tipped the bank to an operating loss of £103.8m. The bad debt ratio advanced to 1%, net interest margin fell 20 basis points to 7.3% and RoTE stood at 7.4%.
