FULL YEAR RESULTS PRESENTATION 2017 RESULTS FOR YEAR ENDED 30 NOVEMBER 2017
2017 Overview Encouraging full year performance with strong Q4 and exit rate into 2018 Adjusted profit before tax up 9% to 44.5m GP up 4%* YoY (up 11% on an as reported basis) and up 8%* YoY in Q4 Growth in GP driven by USA (+18%*) and Continental Europe (+9%*), whilst UK&I remains challenging (-14%*) 81% of GP now generated outside UK&I (FY 2016: 75%) Contract GP up 10%* YoY, with growth across all sectors Contract now accounts for 71% of Group GP (FY 2016: 67%) anent GP down 8%* YoY, but productivity improved by 3%* YoY Foreign exchange increased reported operating profit by c 5.0m and GP by c 18.1m Move of London based support functions to Glasgow underway** Final dividend maintained *Growth is at constant currency ** Net Cost is expected to be c 14-16m,less expected regional development grant of c 2m. Exceptional impact in 2017 of 6.7m. Annualised benefit of c 4-5m per annum on completion of move 2
FINANCIAL RESULTS 3
FINANCIAL HIGHLIGHTS Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted FY 2017 FY 2017 FY 2016 FY 2016 Actual Growth Actual Growth CC Growth* Revenue 1,114.5m 1,114.5m 959.9m 959.9m +16% +16% +9% Contract gross profit 203.5m 203.5m 173.3m 173.3m +17% +17% +10% anent gross profit 84.2m 84.2m 85.4m 85.4m -1% -1% -8% Total gross profit 287.7m 287.7m 258.7m 258.7m +11% +11% +4% Operating profit 44.9m 38.2m 41.3m 37.8m +9% +1% -3% Conversion ratio 15.6% 13.3% 16.0% 14.6% -0.4%pts -1.3%pts -1.2%pts Profit before tax 44.5m 37.7m 40.8m 37.3m +9% +1% -3% Taxation ( 11.4m) ( 10.1m) ( 11.0m) ( 10.1m) -4% - +8% Profit after tax 33.1m 27.6m 29.8m 27.2m +11% +2% -1% Basic earnings per share 25.7p 21.5p 23.2p 21.2p +11% +1% -1% Dividend per share 14.0p 14.0p 14.0p 14.0p Net cash 5.6m 5.6m 10.0m 10.0m *Growth is at constant currency, on an adjusted basis Note 1: Conversion ratio = operating profit expressed as a % of gross profit Note 2: 2017 figures are adjusted for the impact of 6.7m of costs in relation to the strategic restructuring and relocation of UK central support functions Note 3: 2016 figures are adjusted for the impact of 3.5m of costs in relation to the restructuring of certain sales businesses and central support functions 4
BALANCE SHEET 30 November 30 November 2017 2016 Intangible assets 11.4m 11.6m Property, plant & equipment 6.7m 7.1m Investments 1.8m 0.7m Deferred tax assets 4.2m 2.5m Net working capital 67.0m 50.3m Provisions ( 14.5m) ( 5.8m) Net current tax liabilities ( 1.5m) ( 0.7m) Investments Investments in Innovation start ups and incubator Deferred tax assets Primarily due to increased provisions Net Working Capital Increase due to growth in Contract runner book and DSO increase Provisions Increased for restructuring costs 75.1m 65.7m Net cash 5.6m 10.0m Net assets 80.7m 75.7m Strong cash position 50m revolving credit facility ('RCF') with Citibank and HSBC, committed to May 2019 A robust balance sheet 5
CASH FLOW BRIDGE 44.9m 6.1m 3.5m ( 0.6m) ( 1.0m) ( 6.9m) ( 7.8m) ( 11.2m) ( 13.4m) 10.0m 5.6m ( 18.0m) YE 2016 Net Cash Operating profit Depn and amort Share awards + other non cash items Foreign exchange + other Restructuring Capex & investments Treasury shares purchased Taxes and interest Working capital Dividends YE 2017 Net Cash Note 1: Cash Flow presented on an adjusted basis 6
LONDON BASED SUPPORT RELOCATION 250 Roles* proposed for relocation Exceptional Charge m s People costs 11m - 12m Other Costs 3m - 4m Simple Payback of c3 years Total 14m - 16m Less: Regional Development Grant c. 2m c 4m- 5m annualised benefit Total Exceptional Cost 12m - 14m Cash outflow of c 13m to 14m in 2018 (2017: 1m) Restructuring costs of 6.7m recognised as exceptional items in 2017. Further costs of 8m- 9m expected in 2018 with a regional development grant of up to c 2m receivable in future years contingent on investment * Include IT, Finance and HR 7
EARNINGS PER SHARE AND DIVIDENDS Adjusted As Reported Adjusted As Reported Adjusted As Reported FY 2017 FY 2017 FY 2016 FY 2016 Actual Growth Actual Growth Profit after tax 33.1m 27.6m 29.8m 27.2m +11% +2% Weighted average number of shares For basic EPS 128.6m 128.6m 128.3m 128.3m +0% +0% Dilutive impact of share plans 4.0m 4.0m 3.8m 3.8m +5% +5% Fully diluted EPS 132.6m 132.6m 132.1m 132.1m +0% +0% EPS Basic 25.7p 21.5p 23.2p 21.2p +11% +1% Diluted 24.9p 20.8p 22.6p 20.6p +10% +1% DPS Interim Ordinary 14.0p 14.0p 14.0p 14.0p - - Dividends maintained YoY Note 1: 2017 figures are adjusted for the impact of 6.7m of costs in relation to the strategic restructuring and relocation of UK central support functions Note 2: 2016 figures are adjusted for the impact of 3.5m of costs in relation to the restructuring of certain sales businesses and central support functions 8
FOREIGN EXCHANGE IMPACT Year Ended Year Ended YoY Exchange 30 November 2017 30 November 2016 Rate Movement Average Closing Average Closing Average Closing EUR 1.15 1.14 1.25 1.18 (8.2%) (3.8%) USD $ 1.28 1.35 1.39 1.25 (7.6%) 8.2% Year Ended Year Ended 30 November 2017 30 November 2016 Gross Profit Operating Operating Gross Profit Profit Profit EUR 1,520k 467k 1,300k 431k USD $ 643k 169k 506k 79k Impact of a 1% change per annum An FX tailwind in 2017. If the exchange rates of the Group s main operating currencies had remained at FY 2016 average rates throughout the current year, FY 2017 GP and OP would have been lower by c 18.1m and c 5.0m, respectively. 9
OPERATING REVIEW 10
2017 PROGRESS Progress Strategic investment in Contract Drive recovery in anent productivity Broaden capabilities in high growth US markets Accelerate sector diversification in key STEM growth markets Build scale and critical mass in global network Focus on costs and efficiencies to improve operational gearing Record Contract Runners at year end Contract now 71% of GP (FY 2016: 67%) Now represents 65% of sales headcount, our highest ever 16 th consecutive quarter of growth Productivity up 3%* YoY Separate management structure for anent business to drive accountability and improve focus GP up +18%* YoY with Contract up +21%* and anent up +12%* Double digit growth achieved across all sectors except Banking & Finance Our second largest region, representing 22% of our Group Robust performances in Life Sciences and Engineering offsetting weakness in Banking & Finance Continued recovery in Energy and moderate growth in ICT Exciting ICT opportunities outside UK and Europe Growth driven by increased returns from existing locations Group period end headcount up 10% YoY and up 7% sequentially in Q4 New offices opened in Lyon, Toulouse, Vienna and Barcelona Majority of London based support functions to relocate to Glasgow** Improving consultant productivity, up 5%* YoY *Growth is at constant currency ** Net Cost is expected to be c 14-16m,less expected regional development grant of c 2m. Exceptional impact in 2017 of 6.7m. Annualised benefit of c 4-5m per annum on completion of move 11
BUSINESS PROFILE DIVISION DIVERSIFICATION GEOGRAPHICAL DIVERSIFICATION SECTOR DIVERSIFICATION 2% 29% 7% 19% 22% 22% FY 2017 FY 2017 FY 2017 9% 43% 71% 52% 9% 15% 1% 33% 20% 6% 25% 21% FY 2016 FY 2016 9% FY 2016 45% 67% 8% 49% 16% Cont UK&I C Europe USA APAC & ME ICT Banking & Finance Energy Engineering Life Sciences Other 12
CONTRACT / PERMANENT GROSS PROFIT ANALYSIS DIVISION GEOGRAPHY SECTOR 29% 21% 29% 31% 49% 25% 45% 7% 28% 36% FY 2017 71% 79% 71% 69% 51% 75% 55% 93% 72% 64% Contract anent UK&I C Europe USA APAC & ME ICT Banking & Finance Energy Engineering Life Sciences 33% 23% 34% 33% 61% 27% 48% 8% 35% 40% FY 2016 67% 77% 66% 67% 39% 73% 52% 92% 65% 60% UK&I C Europe USA APAC & ME ICT Banking & Finance Energy Engineering Life Sciences Continued focus on growth in Contract across all regions and sectors 13
KEY PERFORMANCE INDICATORS: CONTRACT CONTRACT RUNNERS 4,157 4,359 4,692 5,122 +5% FY09 +8% FY10 +9% FY11 5,791 +13% FY12 7,573 +31% FY13 8,412 +11% FY14 9,078 +8% FY15 10,197 +12% FY16 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Contract margin % FY 2017 19.8% FY 2016 19.9% GROSS PROFIT PER DAY RATE -1%* FY09 +4%* FY10-2%* FY11-5%* FY12 0%* FY13 +3%* FY14-1%* FY15 Flat* FY16 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Contract runners nearly doubled since 2012 * Growth is at constant currency Note 1: All numbers are period end Note 2: Contractors are those on placement with one of the Group s clients at the end of the relevant period Note 3: The average gross profit per day per contractor is calculated by taking the period end Total Runner Weekly Gross Profit position, divided by the period end number of active contractors, divided by 5 (assuming a 5 day working week) 14
CONTRACT RUNNERS COMPARISON TO PRIOR YEARS 135% 130% 131% 125% 120% 115% 110% 105% 112% 112% 111% 108% 100% 95% 90% November December January February March April May June July August September October November 2013 2014 2015 2016 2017 15
KEY PERFORMANCE INDICATORS: PERMANENT 6,060 6,551 7,434 7,343 6,429 6,601 6,408 5,731 4,972 PERMANENT PLACEMENT VOLUMES +8% FY09 +13% FY10-1% FY11-12% FY12 +3% FY13-3% FY14-11% FY15-13% FY16 Placement volumes down 13% YoY FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Average fee up 3%* YoY PERMANENT AVERAGE FEE +1%* FY09 +6%* FY10 +4%* FY11 0%* FY12 +1%* FY13 +3%* FY14 +1%* FY15 +3%* FY16 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 anent is more vulnerable to market sentiment and placement volumes are down YoY. The decrease is broadly in line with the 10% decrease in anent headcount. * Growth in constant currency Note 1: The average permanent placement fee is calculated using the total placement fees for the relevant period, divided by the number of placements for the period Note 2: This analysis excludes retained business Note 3: 2014 data is adjusted due to timing of period ends (an additional 45 placements in Germany) Note 4: 2013 data is based on a normalised 52 week period 16
STRATEGY & OUTLOOK 17
Our purpose: We bring skilled people together to build the future 18
Our vision: To be the #1 STEM talent provider in the best STEM markets 19
Our operating principles: 20
5 year strategy to deliver our vision 21
INNOVATION Helps to future-proof the company Generate new revenue streams Innovative approach to meet our customers evolving demands Minimise risk through governance and support structure BUY BUILD Invested $2m in three third party start-up s Talent Acquisition Platform focused on cultural fit and automated matching. Initial stages of growth. Has attracted blue-chip technology brands. Create and manage asynchronous video interviews. Being trialled internally with one of our core brands. Hybrid tech recruitment platform. Pilot planned for H1 2018 before wider adoption. Expect to spend 3m on Innovation in operating expenses in 2018 (2017: 2m) 22
2018 PRIORITIES Progress Grow and extend regions, sectors and services Develop and sustain great customer relationships Focus on Contract, drive anent profitability Generate incremental revenues through Innovation and M&A Build infrastructure for leveraged growth Find, retain and develop great people Invest and grow in key markets, particularly in USA and Germany Maximise opportunities in ICT, Life Sciences, Engineering & Energy Further leverage our Employee Contractor Model to create new opportunities Continue to use NPS to drive improvements in our processes and behaviours Embed our operating principles throughout the organisation to create great customer experience Focus on growing Contract headcount faster than anent, in line with our plan Continue to maintain a strong permanent offering in key markets such as Germany & USA Complete separate management structures for anent & Contract business to drive profitability and improve focus Leverage our existing innovation investments and launch additional ventures incubated within SThree Trial additional services and test products developed by our third party investments Invest in new offices in key markets and drive increased returns from existing locations Deploy salesforce marketing cloud Relocate UK central support roles to Glasgow with minimal impact on customer service Develop our future female leaders Understand what matters most to our employees through employee NPS surveys and act on feedback 23
OUTLOOK Encouraged by the improvement in momentum in Q4 Continued headcount investment in more resilient Contract market Contract runners nearly doubled since 2012 Continued focus on productivity in anent with selective headcount investment Sectorally and geographically diverse and agile Trading outlook remains encouraging with Continental Europe and USA well positioned for growth Enter 2018 in good shape To be the #1 STEM talent provider in the best STEM markets 24
FINANCIAL CALENDAR 2018 29 January Annual results for the year ended 30 November 2017 16 March Q1 Trading Statement 26 April Annual General Meeting 15 June Trading update for the six months ended 31 May 2018 23 July Interim results for the six months ended 31 May 2018 14 September Q3 Trading Statement 14 December Trading update for the year ended 30 November 2018 2019 28 January Annual results for the year ended 30 November 2018 25
Notes 26
SUPPLEMENTARY MATERIAL 27
GEOGRAPHICAL GROSS PROFIT ANALYSIS FY 2017 FY 2016 GROSS PROFIT GROWTH / (DECLINE) BY REGION* 13% 9% 6% 18% 9% 10% 17% - (14%) (4%) UK&I Benelux (8%) (15%) France GEOGRAPHICAL DIVERSIFICATION 22% 28% 7% 19% 5% 19% Germany USA APAC & ME 20% 27% 6% 5% 25% 17% ASIA PACIFIC & MIDDLE EAST 21% 45% 34% Australia Asia Middle East 20% 48% 32% * Growth is at constant currency 28
SECTOR GROSS PROFIT ANALYSIS FY 2017 FY 2016 25% GROSS PROFIT GROWTH / (DECLINE) BY SECTOR* 5% 7% 15% 12% 9% 8% 1% 1% (9%) (2%) (30%) 2% 1% SECTORAL DIVERSIFICATION 9% 22% 43% 9% 21% 45% 9% 8% 15% 16% * Growth is at constant currency 29
GROSS PROFIT PERFORMANCE BY REGION UK&I GP Growth YoY Average Sales Headcount YoY Cont Total Cont / Mix Cont Total Q3 17-10% -12% -10% Cont 21% 79% Q3 17-9% -9% -9% 19% of Group Q4 17-9% -25% -13% Q4 17-4% -6% -4% -11% -22% -14% -10% -17% -12% Q3 17 +12% -9% +6% Cont 29% 71% Q3 17 +24% -4% +13% C Europe 52% of group Q4 17 +24% -1% +16% Q4 17 +23% +2% +15% +17% -7% +9% +21% -5% +10% Q3 17 +24% +12% +20% Cont 31% 69% Q3 17-2% -5% -3% USA 22% of Group Q4 17 +23% +6% +17% Q4 17 +9% +20% +12% +21% +12% +18% -8% -9% -8% APAC & MENA Cont Q3 17 +32% -20% +1% 51% Q3 17-11% -17% -15% 49% 7% of group Q4 17 +4% -14% -7% Q4 17 +3% -9% -5% +24% -22% -4% -6% -17% -14% Q3 17 +9% -6% +5% Cont 29% 71% Q3 17 +8% -7% +2% GROUP Q4 17 +14% -5% +8% Q4 17 +12% +1% +8% Note 1: GP Growth is at constant currency +10% -8% +4% +5% -10% -1% 30
GROSS PROFIT PERFORMANCE BY REGION UK&I GP Growth YoY HY 17 Average Sales Headcount YoY Cont Total Cont / Mix Cont Total Q1 17-13% -37% -19% Cont 21% 79% Q1 17-12% -27% -18% 20% of Group Q2 17-14% -11% -14% Q2 17-15% -22% -17% HY 17-14% -25% -16% HY 17-14% -24% -17% Q1 17 +17% -11% +7% Cont 30% 70% Q1 17 +15% -9% +5% C Europe 51% of group Q2 17 +15% -8% +7% Q2 17 +20% -9% +8% HY 17 +16% -9% +7% HY 17 +17% -9% +6% Q1 17 +11% +16% +12% Cont 32% 68% Q1 17-17% -28% -21% USA 22% of Group Q2 17 +23% +13% +20% Q2 17-19% -17% -18% HY 17 +17% +14% +16% HY 17-18% -23% -20% Q1 17 +11% -30% -14% Cont 47% 53% Q1 17-4% -22% -17% APAC & MENA 7% of group Q2 17 +54% -22% +5% Q2 17-12% -19% -17% HY 17 +31% -26% -4% HY 17-8% -21% -17% Q1 17 +7% -14% - Cont 30% 70% Q1 17-1% -18% -8% GROUP Q2 17 +9% -6% +4% Q2 17 - -15% -6% HY 17 +8% -10% +2% HY 17 - -17% -7% Note 1: GP Growth is at constant currency 31
GROSS PROFIT PERFORMANCE BY SECTOR GP Growth YoY Average Sales Headcount YoY Cont Total Cont / Mix Cont Total Q3 17 +2% -3% +1% Cont 25% 75% Q3 17 +6% -7% +2% ICT 43% of Group Q4 17 +4% -6% +1% Q4 17 +8% -3% +5% +4% -6% +1% +4% -10% -1% BANKING & FINANCE ENERGY Cont Q3 17 +8% -6% +1% 45% 55% Q3 17-11% -16% -14% 15% of group Q4 17 +17% -17% -1% Q4 17-6% -7% -7% +6% -10% -2% -7% -15% -11% Q3 17 +37% +12% +35% Cont 7% 93% Q3 17 +17% +5% +16% 9% of Group Q4 17 +46% +113% +50% Q4 17 +20% +2% +19% +26% +15% +25% +4% -19% +2% Q3 17 +10% -5% +5% Cont 28% 72% Q3 17 +27% -2% +15% ENGINEERING 9% of Group Q4 17 +23% -13% +11% Q4 17 +36% +9% +25% +17% -18% +5% +21% -11% +7% LIFE SCIENCES Cont Q3 17 +13% -12% +3% 64% Q3 17 +11% +2% +7% 36% 22% of group Q4 17 +16% +6% +12% Q4 17 +21% +15% +18% +15% -4% +7% +9% -3% +3% Note 1: GP Growth is at constant currency 32
GROSS PROFIT PERFORMANCE BY SECTOR GP Growth YoY HY 17 Average Sales Headcount YoY Cont Total Cont / Mix Cont Total Q1 17 +7% -10% +2% Cont 26% 74% Q1 17 - -14% -5% ICT 44% of Group Q2 17 +3% -6% +1% Q2 17 - -14% -5% HY 17 +5% -8% +1% HY 17 +0% -14% -5% BANKING & FINANCE ENERGY Cont Q1 17-5% -12% -8% 45% 55% Q1 17-1% -20% -11% 15% of group Q2 17 +3% -6% -1% Q2 17-9% -18% -14% HY 17-1% -9% -5% HY 17-5% -19% -13% Q1 17-10% +1% -8% Cont 8% 92% Q1 17-13% -48% -17% 9% of group Q2 17 +30% -35% +24% Q2 17-6% +2% -6% HY 17 +10% -15% +7% HY 17-9% -32% -12% Q1 17 +22% -34% -1% Cont 28% 72% Q1 17 +6% -28% -10% ENGINEERING 9% of Group Q2 17 +14% -17% +3% Q2 17 +15% -17% +1% HY 17 +17% -26% +1% HY 17 +10% -23% -5% LIFE SCIENCES Cont Q1 17 +17% -13% +4% 64% Q1 17 +3% -17% -7% 36% 21% of group Q2 17 +12% - +7% Q2 17 +2% -9% -3% HY 17 +15% -7% +6% HY 17 +3% -13% -5% Note 1: GP Growth is at constant currency 33
UK&I TRADING METRICS 19% of Group GP UK Ireland FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 8 Contract -13% -14% -10% -9% -11% NOV 16 10 YoY -2 anent -37% -11% -12% -25% -22% Total -19% -14% -10% -13% -14% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 1% 2% ICT 21% 12% Banking & Finance 10% 23% 10% Cont Energy 12% 3% Engineering 3% 58% 60% 77% 15% 14% Life Sciences 79% Other Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 34
UK&I TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 360 2,616 1,075 151 511 FY 16 2,663 FY 16 1,455 Cont Total Cont Total YoY YoY -1% -9% -3% -2% YoY -26% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 349 159 508 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY -10% -17% -12% -1% Below +4% Below * Excluding retained business Note 1: Growth is at constant currency 35
BENELUX TRADING METRICS 5% 1% Bel Lux 19% of Group GP 13% FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 7 Contract +16% +19% +21% +38% +24% NOV 16 6 YoY 1 anent -18% -18% -33% -3% -17% Neth Total +6% +10% +8% +28% +13% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 ICT 19% 26% 74% 81% Cont 8% 6% 12% 12% 13% 49% Banking & Finance Energy Engineering Life Sciences Other 6% 8% 12% 11% 13% 50% Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 36
BENELUX TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 315 2,537 794 106 421 FY 16 1,970 FY 16 993 Cont Total Cont Total YoY YoY +22% -9% +12% +29% YoY -20% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 293 99 392 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY +21% -19% +7% -0% Below +2% Below * Excluding retained business Note 1: Growth is at constant currency 37
GERMANY TRADING METRICS 28% of Group GP Germany Switz FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 8 Contract +16% +10% +7% +15% +12% NOV 16 8 YoY 0 anent -7% -5% +4% -1% -2% Total +6% +4% +5% +8% +6% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 ICT 37% 40% 60% 63% Cont 20% 14% 6% 4% 56% Banking & Finance Energy Engineering Life Sciences Other 23% 14% 7% 4% 52% Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 38
GERMANY TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 401 2,316 1,619 280 681 FY 16 1,971 FY 16 1,746 Cont Total Cont Total YoY YoY +29% +14% +22% +18% YoY -7% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 337 253 590 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY +17% +3% +11% +1% Above +1% Below * Excluding retained business Note 1: Growth is at constant currency 39
FRANCE TRADING METRICS 5% of Group GP France FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 3 Contract +21% +20% +9% +15% +16% NOV 16 1 YoY 2 anent -16% +5% -32% +14% -8% Total +9% +16% -1% +14% +9% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 ICT 24% 28% 72% 76% Cont 4% 10% 18% 20% 48% Banking & Finance Energy Engineering Life Sciences Other 16% 7% 8% 19% 50% Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 40
FRANCE TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 97 682 FY 17 196 33 130 FY 16 631 FY 16 256 Cont Total Cont Total YoY YoY +24% -7% +15% +8% YoY -23% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 91 31 122 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY +35% -13% +18% +6% Below +2% Below * Excluding retained business Note 1: Growth is at constant currency 41
USA TRADING METRICS 22% of Group GP USA FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 8 Contract +11% +23% +24% +23% +21% NOV 16 8 YoY 0 anent +16% +13% +12% +6% +12% Total +12% +20% +20% +17% +18% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 ICT 31% 33% 67% 69% Cont 46% 14% 17% 22% Banking & Finance Energy Engineering Life Sciences Other 49% 15% 11% 25% Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 42
USA TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 233 1,552 803 120 353 FY 16 1,363 FY 16 680 Cont Total Cont Total YoY YoY +11% +23% +15% +14% YoY +18% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 215 104 319 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY -8% -9% -8% -3% Above -7% Above * Excluding retained business Note 1: Growth is at constant currency 43
ASIA PACIFIC & MIDDLE EAST TRADING METRICS APAC & MENA 7% of Group GP FY GROSS PROFIT GROWTH YoY OFFICES Q1 Q2 Q3 Q4 FY NOV 17 6 Contract +11% +54% +32% +4% +24% NOV 16 6 YoY 0 anent -30% -22% -20% -14% -22% Total -14% +5% +1% -7% -4% DIVISION MIX SECTOR MIX FY 2017 SECTOR MIX FY 2016 ICT 49% 61% 39% 51% Cont 20% 14% 28% Banking & Finance Energy Engineering 2% 16% 17% 29% 38% Life Sciences Other 36% Outside FY 2017; inside FY 2016 Note 1: Growth is at constant currency Note 2: Office count includes corporate function offices 44
ASIA PACIFIC & MIDDLE EAST TRADING METRICS PERIOD END CONTRACT PERMANENT SALES HEADCOUNT RUNNERS PLACEMENTS* 66 494 485 95 161 FY 16 480 FY 16 601 Cont Total Cont Total YoY YoY +12% -8% -1% +3% YoY -19% AVERAGE CONTRACT GROSS PERMANENT SALES HEADCOUNT PROFIT PER DAY RATE1 PLACEMENT FEE*1 59 98 157 FY 16 FY 16 Cont Total Cont Total YoY Group YoY Group YoY -6% -17% -14% -11% Below -2% Above * Excluding retained business Note 1: Growth is at constant currency 45
SECTOR GROSS PROFIT ANALYSIS GROUP BY SECTOR 2% ICT BY REGION 4% BANKING & FINANCE BY REGION 9% 22% 9% 21% 9% 8% 16% 15% 45% 43% 36% 7% 6% 33% 32% 6% 19% 6% 26% 21% 32% 15% 18% 15% 23% 31% 14% 11% 6% 12% 7% 16% ENERGY BY REGION ENGINEERING BY REGION 2% LIFE SCIENCES BY REGION 4% 41% 13% 6% 15% 10% 29% 26% 15% 5% 11% 24% 5% 44% 44% 27% 23% 27% 25% 48% 45% 11% 5% 12% 5% 29% 7% 4% 26% 2% ALL CHARTS: Outside FY 2017; Inside FY 2016 UK&I Benelux France DACH USA APAC & ME 46
CASH FLOW Adjusted As Reported Adjusted As Reported FY 2017 FY 2017 FY 2016 FY 2016 Operating profit before exceptional items 44.9m 38.2m 41.3m 37.8m Depreciation, amortisation and impairments 6.1m 6.1m 5.7m 5.7m Share awards charge and other non cash items 3.5m 3.5m 3.0m 3.0m Increase in receivables ( 35.7m) ( 35.7m) ( 9.4m) ( 9.4m) Increase in payables and provisions 22.3m 28.0m 6.3m 6.0m Net cash generated from operations 41.1m 40.1m 46.9m 43.1m Taxation paid ( 10.9m) ( 10.9m) ( 8.5m) ( 8.5m) Capital expenditure ( 5.8m) ( 5.8m) ( 7.2m) ( 7.2m) Investments ( 1.1m) ( 1.1m) ( 0.7m) ( 0.7m) Net finance expense ( 0.3m) ( 0.3m) ( 0.5m) ( 0.5m) Dividends paid ( 18.0m) ( 18.0m) ( 18.0m) ( 18.0m) Treasury shares purchased ( 7.8m) ( 7.8m) ( 6.8m) ( 6.8m) Tracker shares and share option related transactions 0.1m 0.1m 0.6m 0.6m FX movement ( 0.7m) ( 0.7m) 2.7m 2.7m Movement in net (debt) / cash ( 3.4m) ( 4.4m) 8.5m 4.7m Cash outflow from FY17 restructuring ( 0.9m) Cash outflow from FY16 and FY15 restructuring ( 0.1m) ( 4.7m) ( 4.7m) Movement in net (debt) / cash after adjustments ( 4.4m) ( 4.4m) 3.8m 4.7m Opening net cash 10.0m 10.0m 6.2m 6.2m Closing net cash 5.6m 5.6m 10.0m 10.9m Cash conversion ratio 79% 90% 96% 95% Commentary on Adjusted cash flow Receivables & Payables Increased due to growth in our runner book and increase in DSO s Treasury shares purchase Purchased to settle sharebased payments Cash conversion ratio Reduced due to increase in working capital Note 1: 2017 figures are adjusted for the impact of 6.7m of costs in relation to restructuring and relocation of UK central support functions Note 2: 2016 figures are adjusted for the impact of 3.5m of costs in relation to the restricting of certain sales businesses and central support functions Note 3: Cash conversion ratio is calculated as net cash generated from operations less capital expenditure, stated as a % of operating profit before exceptional items / adjustments, and is a measure of the Group s ability to convert profit into cash 47
HISTORICAL GROSS PROFIT & GROSS MARGIN FY GP 213.6m 167.8m 162.4m 189.5m 199.5m 192.8m 218.2m 235.7m 258.7m 287.7m 400m 300m GROSS PROFIT 200m 100m 0m 113.9m 76.2m 89.8m 102.2m 102.4m 101.2m 117.4m 125.2m 138.9m 153.3m 99.7m 91.6m 72.5m 87.3m 97.1m 91.6m 100.8m 110.5m 119.8m 134.4m 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1 H2 21.5% 22.1% 21.6% 21.4% 21.5% 20.2% 20.0% 19.8% 19.9% 19.8% CONTRACT GROSS MARGIN Note 1: 2013 data is based on a normalised 52 week period 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Robust Contract margin despite strong growth in Energy 48
23.8% 25.9% 11.8% 10.5% 9.6% 12.8% 12.2% 15.3% 9.2% 12.2% 7.1% 10.9% 8.3% 13.7% 12.8% 17.6% 12.8% 16.0% 14.4% 15.6% HISTORICAL OPERATING PROFIT & CONVERSION RATIO ADJUSTED OPERATING PROFIT before exceptional items CONVERSION RATIO adjusted operating profit before exceptional items as a % of gross profit FY OP 60m 50m 40m 30m 20m 10m 0m 56.8m 18.0m 21.2m 30.0m 25.1m 21.0m 29.8m 41.5m 41.3m 44.9m 32.4m 24.4m 7.0m 14.1m 19.0m 16.0m 14.3m 21.4m 11.0m 7.1m 11.0m 9.1m 6.7m 8.4m 27.4m 26.0m 25.6m 14.1m 15.3m 19.3m 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1 H2 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 HY FY Note 1: 2017 figures are adjusted for the impact of 6.7m of costs in relation to restructuring and relocation of UK central support functions Note 2: 2016 figures are adjusted for the impact of 3.5m of costs in relation to the restructuring of certain sales businesses and central support functions Note 3: 2015 figures were adjusted for the impact of 3.1m of costs in relation to restructuring Energy business and the impairment of IT assets Note 4: 2013, 2014 and 2015 are before exceptional items Note 5: Includes data for IT Job Board up to 2011 Note 6: 2013 data is based on a normalised 52 week period 49
HEADCOUNT Period End Total Heads Period End Sales Heads Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13 Nov 13 May 14 Nov 14 May 15 Nov 15 May 16 Nov 16 May 17 Nov 17 1,461 1,638 1,719 1,865 2,109 2,100 2,021 2,125 2,232 2,484 2,483 2,571 2,752 2,712 2,590 2,642 2,866 1,051 1,181 1,204 1,351 1,610 1,620 1,568 1,667 1,797 2,015 2,016 2,051 2,185 2,142 2,044 2,064 2,257 592 707 720 832 1,046 1,113 1,109 1,190 1,300 1,477 1,475 1,498 1,606 1,592 1,554 1,607 1,787 459 474 484 519 564 507 459 477 497 538 541 553 579 550 490 457 470 Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13 Nov 13 May 14 Nov 14 May 15 Nov 15 May 16 Nov 16 May 17 Nov 17 UK Sales Heads Int'l Sales Heads Note 1: Headcount is now based on full time equivalent heads. Note 2: Sales heads include consultants and sales management 50
SALES HEADCOUNT Period End Sales Heads Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13 Nov 13 May 14 Nov 14 May 15 Nov 15 May 16 Nov 16 May 17 Nov 17 1,051 1,181 1,204 1,351 1,610 1,620 1,568 1,667 1,797 2,015 2,016 2,051 2,185 2,142 2,044 2,064 2,257 785 1,006 949 927 915 843 764 740 987 974 885 843 903 822 615 700 746 436 481 458 529 623 646 683 824 894 1,009 1,067 1,124 1,270 1,299 1,280 1,324 1,472 Nov 09 May 10 Nov 10 May 11 Nov 11 May 12 Nov 12 May 13 Nov 13 May 14 Nov 14 May 15 Nov 15 May 16 Nov 16 May 17 Nov 17 Contract Sales Heads anent Sales Heads Note 1: Headcount is now based on full time equivalent heads Note 2: Sales heads include consultants and sales management 51
COST BASE ANALYSIS 2% 5% 8% 16% 6% Cost Base Payroll Costs 79% 84% Payroll Property Advertising IT & Professional Other Support Services Sales The Group has maintained its flexible cost base Note 1: Based on costs for FY 2017 52
TRACKER SHARE ARRANGEMENTS Low barriers to entry make it a challenge to retain senior staff tracker shares mitigate this. Tracker shares how they work < 22.5% Sold to entrepreneurial staff at fair value < 22.5% Sold to SThree The Tracker Share model allows selected individuals to invest in the business for which they are responsible. > 77.5% Owned by SThree 5 YEARS > 77.5% Owned by SThree This is unique in the sector and helps drive strong retention and ownership behaviours. Business valued at fair sale value at an early stage Strong governance via Tracker Shares Steering Committee 2017 settlements 3.3m (2016: 4.6m: 2015: 8.5m, 2014: 8.3m) Expect future settlements to be 5-15m in shares Settlements entirely at SThree s discretion no put option Exit Value 1/2-2/3 x PAT x PER DRIVES STRONG RETENTION AND OWNERSHIP BEHAVIOURS Note 1:PAT is Group Profit After Tax. PER is the Group Price/Earnings Ratio calculated as the Share Price/Adjusted Earnings Per Share. 53
40 OFFICES IN 16 COUNTRIES UK & IRELAND UK Birmingham Bristol Glasgow London Leeds Manchester IRELAND Dublin USA CONTINENTAL EUROPE USA Austin Boston Chicago Houston Minneapolis New York San Diego San Francisco BELGIUM Antwerp Brussels NETHERLANDS Amsterdam Rotterdam LUXEMBOURG Luxembourg GERMANY Berlin Düsseldorf Frankfurt Hamburg Munich Stuttgart SWITZERLAND Zurich Asia Pac & Middle East AUSTRALIA Sydney HONG KONG Hong Kong SINGAPORE Singapore JAPAN Tokyo UAE Dubai FRANCE Paris Lyon Toulouse AUSTRIA Vienna SPAIN Barcelona 54