report  financial statements 2010 executive directors
russell clements chief executive officer
gary elden chief development officer
alex smith chief financial officer
nonexecutive directors
clay brendish non executive chairman
paul bowtell non executive
alicja lesniak non executive
t ony ward non executive sid
nadhim zahawi non executive
group company secretary  registered office
steve hornbuckle group company secretary
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sthree plc
company information and corporate advisers inside front cover company information and corporate advisers
 1 board of directors and secretary
 3 chairman’s statement
 5 financial highlights
 6 chief executive officer’s review
 9 chief financial officer’s review
11 group strategic development review
13 directors’ report
21 directors’ remuneration report
29 corporate governance report
40 corporate social responsibility report
44 independent auditors’ report
46 consolidated statement of comprehensive income
47 statement of financial position consolidated and company
48 consolidated statement of changes in equity
49 company statement of changes in equity
50 statement of cash flows consolidated and company
51 notes to the financial statements
96 five year financial summary
inside back cover shareholder information
sthree plc
contents sthree plc 1
board of directors and secretary
report  financial statements 2010
the board brings together a wealth of experience across differing sectors and businesses on an international basis most 
importantly they share a passion for the business and the outstanding opportunities ahead
chairman
clay brendish cbe joined the sthree board in may 2010 as non executive chairman clay is currently non executive chairman of anite group plc 
and echo research limited clay’s other non executive directorships are bt group plc and herald investment t rust plc he is a trustee of economist 
newspapers limited and director of the t est and itchen association limited in may 2001 clay retired as deputy chairman of cmg plc a european ict 
company that was established in 1964 clay’s appointment as deputy chairman followed cmg’s merger with admiral plc in june 2000 prior to the 
merger clay was executive chairman of admiral plc that he cofounded in 1979 admiral plc employed over 2500 people in 8 countries as chairman 
clay had primary responsibility for the strategic direction of admiral investor relations and acquisitions
chief executive officer
russell clements has served as sthree’s chief executive officer since 2004 having previously held the position of deputy chief executive officer 
since 2001 he worked for vnu business publications before joining computer futures in 1986 shortly after its inception as the group’s second 
employee he subsequently served as sales director and managing director of computer futures russell holds a degree in government from the 
university of essex and is also a graduate of the advanced management program at the wharton business school university of pennsylvania he is 
former chairman of the association of professional staffing companies apsco
chief financial officer
alex smith joined sthree in may 2008 having held a number of senior financial and operational roles in the leisure and retail sectors most recently 
he held the position of integration finance director at tui t ravel plc prior to this he was finance director of first choice’s uk mainstream business 
at wh smith plc as managing director of its t ravel retail business and held senior financial roles at t ravelodge and forte plc alex has a degree in 
economics from durham university and is an associate of the institute of chartered accountants in england  wales
non executive director senior independent non executive director
tony ward obe was appointed to the sthree board in august 2006 and to the sthree remuneration and nomination committees in october 
2006 t ony currently chairs the remuneration committee and has over thirty years experience in a variety of senior executive roles with blue chip 
companies including baa plc kingfisher plc and grand metropolitan group plc he joined baa in 1997 as group hr director and was services director 
from 1999 until march 2007 being responsible for activities including it  security rail and airside operations t ony was a board director of baa plc 
between november 1999 and july 2006 t ony is a non executive director of the ocs group limited and an advisor to manchester square partners 
llp a fellow of the chartered institute of personnel development a former deputy chairman of the commission for racial equality and a graduate 
of the university of leeds
clay brendish
 
russell clements 
alex smith  
tony ward
 
chief development officer
gary elden was appointed to the board in july 2008 having been with the group since 1990 when he joined computer futures he has held a 
number of senior positions including that of founding managing director of huxley associates in his role as chief development officer he has 
special responsibility for the expansion of the group’s international operations and nonict disciplines
gary elden  sthree plc 2
board of directors and secretary
report  financial statements 2010 continued
non executive director
paul bowtell was appointed to the sthree board and as chairman of the sthree audit committee in november 2007 and nomination committee in 
april 2008 and is currently a non executive director of capita group plc paul has extensive experience gained from senior finance roles in a variety of 
companies including most recently as chief financial officer of tui t ravel plc but also with first choice holidays plc and british gas a subsidiary 
of centrica plc where he was appointed finance director in 2002 prior to that paul was with wh smith plc where he held a number of corporate 
centre roles before becoming finance director of the uk retail business as well as senior tax roles at forte and arthur andersen paul is an associate 
of the institute of chartered accountants in england  wales
paul bowtell
non executive director
alicja lesniak was appointed to the sthree board in may 2006 to the sthree audit committee in july 2006 the remuneration committee in 
february 2008 and the nomination committee in april 2008 alicja is currently a non executive director of dtz holdings plc and channel 4 and was 
until 30 september 2009 cfo of aegis plc and has over thirty years experience in fast moving service businesses in the latter twenty years holding 
senior financial and managerial roles within the advertisingmedia sector including seven years with bbdo worldwide latterly as chief financial 
officer for bbdo emea and seven years at wpp group plc where she held positions as chief financial officer for ogilvy  mather worldwide 
and managing director of j walter thompson in the uk prior to joining the advertising sector she held senior management positions with arthur 
andersen  co having originally qualified as a chartered accountant with them in 1976 alicja is a fellow of the institute of chartered accountants in 
england  wales and holds a degree in mathematics from imperial college
alicja lesniak
non executive director
nadhim zahawi mp was appointed to the sthree board and to the remuneration and audit committees in may 2008 nadhim is former ceo 
and cofounder of yougov plc a leading international online market research agency and became mp for stratford on avon in may 2010 he was 
previously european marketing director at smith  brooks with responsibility for marketing brands such as warner bros disney and barbie 
after stepping down as a councillor for the london borough of wandsworth a post he had held since 1994 in which he worked on publicsector 
consultation planning social services and research within local government nadhim was previously a director at allen hinckley the property rights 
licensing group and marketing director at global inc a supplier to major retailers nadhim is a patron of the genesis initiative and peace one day and 
holds a degree in chemical engineering from ucl
nadhim zahawi
group company secretary
steve hornbuckle was appointed to the role in october 2006 steve has over twenty years’ company secretarial experience having held deputy 
and assistant secretary positions within a variety of listed companies including intertek group plc bpb plc kidde plc railtrack group plc london 
 manchester group plc and english china clays plc steve is a fellow of the institute of chartered secretaries and sits on the icsa company 
secretaries’ forum and the investor relations society policy committee
steve hornbuckle  sthree plc 3
in my first statement as sthree 
chairman i am very pleased to 
report that despite the economic 
uncertainty which continued as we 
moved into 2010 the group was still 
able to achieve an excellent set of 
results despite some very challenging 
market conditions we expanded the 
business globally the group having 
been reorganised under regional 
mds in early 2010 at the time of 
writing we are also now seeing signs 
that our share price is moving in the 
right direction benefitting those 
shareholders who invested at ipo or 
shortly thereafter and who have stuck 
with the company through the more 
recent difficult times it should not 
be forgotten that many in the latter 
category are our valued employees
during the year we opened new 
offices in perth delhi houston san 
francisco munich and düsseldorf 
with further offices in doha sao 
paulo antwerp and abu dhabi due 
to open in h1 2011 as a result we 
now have an even more diversified 
business both in terms of geographic 
and sector spread this will enable us 
to optimise our performance as the 
market further improves our non 
uk gross profit now represents 60 
of the group’s gross profit 2009 
55 as always we remain open
minded with regard to the launch 
of new ventures continuing to back 
homegrown entrepreneurial talent 
and utilise the established tracker 
share minoritystakes model where 
appropriate in order to expand beyond 
our existing bases
a detailed review of our trading and 
results is provided within the chief 
executive officer’s chief financial 
officer’s reviews and other sections 
of this annual report during the year 
we have also continued to improve 
our reporting on remuneration 
governance and corporate social 
responsibility ‘csr’ issues wherever 
we can to accommodate best practice 
and investor requirements and we will 
continue to expand these areas as the 
business moves forward
we continued to roll out our enterprise 
risk management ‘erm’ processes 
formalising both group and local risk 
appetite parameters under new kpis 
all of which are now firmly embedded 
within the business and underpinned 
by our group risk management policy 
along with early consideration of the 
new uk corporate governance code 
‘the code’ these measures are a 
further demonstration of our solid 
stewardship and strong approach to 
corporate governance
our tried and tested strategy remains 
primarily focused on pursuing 
organic growth through continued 
development of the group’s well
established uk business whilst 
at the same time also increasing 
the group’s revenues from other 
sectors and countries our business 
model continues to prioritise high 
quality over high volume and seeks 
to optimise the superior margins 
we consistently achieve as a 
consequence of this approach the 
multibrand strategy we operate and 
our highly diversified client base will 
as ever be crucial in achieving this 
goal and we believe that all sthree 
businesses irrespective of their 
relative maturity have scope for 
significant further growth
the directors recommend a final 
dividend of 80p second interim 2009 
80p per share for the year ended 
28 november 2010 to be paid on 
6 june 2011 to those on the register as 
at 6 may 2011 this follows the interim 
dividend of 40p 2009 40p per 
share declared earlier in the year and 
paid on 3 december 2010
the sthree business is built on an 
absolute focus on delivering high 
quality and timely permanent and 
contract specialist staffing services 
to our clients it remains therefore 
first and foremost a people business 
and it is only as a direct result of the 
talent and dedication of our people 
that we are able to continue to post 
such resilient results at the year 
end the group employed a total of 
1863 people worldwide an increase 
from 1597 at the prior year end and 
we have a clear strategy to grow 
this further over the next five years 
particularly in our newer geographies 
whilst also launching initiatives 
chairman’s statement
for the year ended 28 november 2010 sthree plc 4
which will improve the way we work 
chief amongst these is our ‘values’ 
initiative which looks to ensure that 
the sthree core values of respect 
rapport energy and reward are at the 
forefront of everything that we do
we are applying early the provisions 
of the uk corporate governance code 
and as such all directors will retire at 
the 2011 agm and submit themselves 
for reelection further information on 
this is contained within the notice of 
meeting
under the code as chairman i 
am required to oversee the annual 
performance evaluation process 
conducted in respect of the board 
committees and individual directors 
and to hold regular development 
meetings with directors in respect 
of any issues identified i am very 
pleased to say that the evaluation 
concluded that overall and 
individually the performance of the 
board each committee and each 
director was and is effective and 
that all directors demonstrate full 
commitment in their respective roles
during the year we said goodbye to 
both sir anthony cleaver and sunil 
wickremeratne t ony retired at the 
agm in april 2010 and his significant 
influence helped create the blueprint 
of the highly successful plc we are 
today whilst sunil retired at the end 
of november 2010 having been with 
the group some 22 years he was 
instrumental in creating a number 
of sthree’s key brands and without 
him the group would certainly not be 
what it is today and he will be sorely 
missed as both a friend and colleague 
by many
i would also like to take this 
opportunity to thank all our continuing 
employees across the world once 
again for their contribution during 
the year many of whom have been 
with the group for all or most of their 
careers some of these individuals 
are featured in the front half of 
this annual report which shows 
highlights from the group’s annual 
management conference and 
corporate hq
we believe that our prospects for 
further growth and success remain 
excellent and whilst our business 
will ultimately depend on the overall 
strength of the worldwide economy 
we are confident of a bright future
clay brendish
chairman
28 january 2011
chairman’s statement continued
for the year ended 28 november 2010 sthree plc 5
financial highlights 
for the year ended 28 november 2010
“sthree delivered a strong result in 2010 in a market which was still some way 
from fully recovered sentiment improved steadily and we ended the year with all 
our markets and territories in growth we were also pleased with the increasing 
momentum in our longer established businesses building towards the end of the 
year looking ahead we remain well positioned to make further progress through 
a combination of expansion in existing markets and further investment in new 
geographies with their substantial structural growth potential”
  2010 2009 change
revenue £4745m £5194m –86
gross profit £1664m £1712m –28
operating profit £212m £180m 178
profit before taxation £216m £180m 200
statutory profit before taxation £216m £89m 1427
basic earnings per share 119p 95p 253
statutory basic earnings per share 119p 40p 1975
proposed dividend 80p 80p –
t otal dividend 120p 120p –
  prior year operating profit profit before taxation and eps are shown before exceptional charges of £91m before tax 
£65m after tax relating to a group restructuring
operational highlights
•
  a strong performance given the changing market sentiment during the year
•
  nonuk share of gross profit increased significantly to 60 2009 55 with trend expected to continue as the group 
becomes ever more international
•
  new offices opened in perth delhi houston san francisco munich and düsseldorf bringing the total to 52 doha sao 
paulo antwerp and abu dhabi due to open in h1 2011
•
  permanent placements increased by 81 to 6551 2009 6060 with average fees remaining strong
•
  number of active contractors at year end increased by 49 to 4359 2009 4157 with average gross profit per day 
rates remaining strong
•
  contract versus permanent mix of gross profit 5149 in favour of contract 2009 5842
•
  continued sector diversification with nonict
1
 disciplines now representing 38 of total gross profit 2009 28
•
  76 of gross profit now derived from outside of the uk ict market 2009 69
•
  t otal group headcount at year end increased by 167 to 1863 2009 1597 with a significant further increase planned 
for 2011
•
  year end net cash and term investments of £552m 2009 £485m reflecting continued strong cash generation
•
  entered 2011 with all markets in growth
1
  non ict sectors primarily comprise engineering  energy banking accountancy  finance and pharmaceuticals  
 biotechnology sthree plc 6
overview
2010 saw a substantially improved 
market when compared to 
the exceptionally challenging 
environment of 2009 that said it 
would be misleading to suggest that 
the overall level of demand for our 
services during 2010 was universally 
consistent with a fully recovered 
marketplace whilst some parts of our 
business equalled or surpassed pre
downturn levels of performance and 
all our markets were in growth by the 
last quarter most were yet to return to 
the very buoyant conditions that we 
would associate with “normality” in 
the specialist staffing market
given this specific context it is 
pleasing to report a strong 2010 
performance the group delivered a 
substantial improvement in overall 
profitability and a further increase in 
our cash balances whilst at the same 
time continuing to invest in the future 
of the business
in addition to increasing sales 
headcount substantially we also 
opened a further six offices bringing 
the overall total to 52 of which 30 
are outside the uk given this strong 
trading platform coupled with steadily 
improving market conditions we 
believe we are in an excellent position 
to make 2011 another year of progress 
on this basis the group intends to 
further grow sales headcount and 
continue the international office roll 
out throughout 2011
financial outcome
during the year the group saw a 
modest reduction in gross profit gp 
with the 2010 figure of £1664m down 
28 2009 £1712m largely due to 
the relative weakness of the contract 
marketplace during most of the year 
however this converted to a profit 
before t ax pbt of £216m up some 
20 before prior year exceptional 
items 2009 £180m reflecting a 
continued tight control of costs
notwithstanding the fact that 2010 
was a year of investment the group 
had another strong performance 
in terms of cash generation at the 
end of 2010 net cash including term 
investments had increased to £552m 
2009 £485m
the strong cash performance 
combined with steadily improving 
market conditions support the 
board’s decision to maintain the total 
2010 dividend at 120p 2009 120p 
which is comfortably underpinned by 
the cash available to the group
geographical expansion
the group continued its well 
established strategy of geographical 
expansion opening six international 
offices in the year in addition 
to further offices in munich and 
düsseldorf we rolled out offices 
in perth delhi houston and san 
francisco bringing the overall total  
to 52 offices in 12 countries
in aggregate group gp generated 
from outside of the uk was £995m 
2009 £942m up 56 given the 
more mature nature of the uk staffing 
market and in particular the continued 
relatively subdued demand for 
contract staff uk gp of £668m  
was down 131 on the prior year 
2009 £769m
as a consequence of this difference 
in relative performance the overall 
non ukuk business mix underwent 
a marked change for 2010 the ratio 
was 6040 in favour of non uk gp 
compared with 5545 in 2009 it is 
likely that this shift will represent an 
ongoing trend as the group becomes 
ever more international however 
the fact remains that the uk has 
consistently demonstrated very 
robust growth in more typical market 
conditions and we are confident that 
the uk will show a significant bounce 
back as confidence levels build
there is now ample evidence to 
indicate a rapidly growing opportunity 
to take the proven sthree model into 
an ever wider range of international 
markets most of which are 
substantially less mature than the 
uk in the first half of 2011 we expect 
to open offices in doha sao paulo 
abu dhabi and antwerp and it is likely 
that the total number of new offices 
opened during 2011 will be similar to 
the six that came on stream each  
year during 2010 and 2009 that 
being said during 2011 we expect the 
large majority of our new hires to  
be into established sthree locations 
thereby derisking the expansion 
programme
sector diversification
in parallel with its greater 
geographical diversity in recent 
years the group has made significant 
progress in developing markets 
outside of its historic ict franchise 
the ict market has attractive 
characteristics not least of all in 
terms of highly paid candidates 
and a structural skills shortage 
in most technical areas albeit in 
some territories the ict market is 
particularly competitive
over a period of years the group 
has demonstrated its expertise in 
moving into adjacent specialist 
staffing sectors many of which are 
both substantially less competitive 
than the ict market and are also 
characterised by candidates who can 
command rates which are at least 
equal to and in many cases above 
those achieved in ict
chief executive officer’s review 
for the year ended 28 november 2010 sthree plc 7
the result of this sectoral 
diversification is that non ict 
franchises accounted for 383 of 
total gp  this figure of £638m was 
up 315 on the previous year 2009 
£485m the major non ict segments 
for the group are banking engineering 
 energy accountancy  finance 
and pharmaceuticals the group also 
has a relatively modest presence in 
each of hr and sales  marketing
the ict franchise performed 
somewhat less robustly than the 
other sectors with 2010 gp of 
£1026m 2009 £1226m down 
163 on the prior year the group’s 
ict performance was impacted by 
a number of factors the relatively 
subdued contract market which is 
disproportionately ict based the 
decline in public sector hiring – 
another ict biased market and the 
weakness of the benelux territories 
our largest ict franchise outside  
the uk
it is worth noting that the gp 
breakdowns given above are 
measured by the skill set of the 
candidate rather than the nature of 
the business of the client company 
by the latter metric rather than a 
62 exposure to the ict market the 
group has in fact only a 19 exposure 
2009 21 to ict customers per se 
and hence benefits from a broad client 
base in terms of industry sectors
“high margin high value”
the group has a stated strategy 
which is focused on the quality of the 
business transacted we do not buy 
market share or swap value for volume 
as we believe both to be inappropriate 
given the highly fragmented nature 
of the specialist staffing market we 
are highly selective in terms of the 
type of clients with which we engage 
and avoid the lower margin business 
which is often a condition of dealing 
with many larger employers in more 
mature markets
in addition we look to go “up the 
food chain” and place more highly 
remunerated candidates either 
as a result of increasing the level 
of seniority of the placements we 
make or by identifying more highly 
paid niche markets the benefits 
of this approach can be seen in the 
robustness of our fees and contract 
rates even in a market which 
remained somewhat more price 
sensitive than normal and which  
was not characterised by the level 
of wage inflation typical of a more 
normal market
the group’s overall contract margin 
remained broadly flat at 216 
2009 221 despite a substantial 
reduction in the number of public 
sector contractors which were 
typically higher than the average 
margin moreover in absolute terms 
the average gross profit per day rate 
gpdr improved somewhat up 
11  to £8565 2009 £8469 on a 
constant currency basis pro rated to 
an annual permanent salary the gpdr 
is the equivalent of £90k 2009 £88k
a similar but more pronounced 
value theme was seen in the group’s 
permanent business the average 
fee recorded in 2010 was £12340 
2009 £11930 up 34 on a constant 
currency basis
contractpermanent  
business mix
unlike the early recovery phase of 
previous upturns the contract market 
did not outperform the permanent 
market in 2010 on the contrary and 
in common with the peer group 
our permanent performance was 
markedly ahead of contract during 
the year the group made a total of 
6551 permanent placements 2009 
6060 an increase of 81 the 
number of contract runners at the 
end of 2010 had improved to 4359 
2009 4157 representing an increase 
of 49
the relative weakness of the contract 
market was exacerbated by the fact 
that the market in benelux was weak 
through most of the year and after 
the uk this territory is the group’s 
largest in terms of contract exposure 
on a similar note gp derived from the 
public sector declined by around 50 
during the year and this is largely a 
contract market by contrast some 
of the strongest performing markets 
eg the far east banking oil  gas 
etc are for us disproportionately 
permanent franchises
the net effect of the above was that 
permanent gp represented 49 of 
the group’s total in 2010 compared 
with 42 of gp for 2009 going 
forward into 2011 and beyond we 
would expect a further increase in 
terms of the permanent share of 
gp as the economic cycle enters a 
more positive phase and the group 
chief executive officer’s review 
for the year ended 28 november 2010   continued sthree plc 8
becomes increasingly exposed to 
territories and markets in which the 
prime opportunity is in permanent 
recruitment
headcount
the improved market conditions 
allowed us to continue with the 
sales headcount growth plan that we 
initiated in the second half of 2009 
as a result the group ended 2010 with 
a total of 1863 staff 2009 1597 an 
increase of 167 on the prior year 
the sales headcount growth was 
primarily focused on rest of world  
up 76 and europe up 11 with the 
uk up 6
our 2010 closing headcount of 1863 
is still 18 below our previous peak of 
2274 heads in november 2008 and 
given our expansion plans for the year 
ahead it is likely that this historic peak 
will be surpassed during 2011
outlook
ultimately the global economic 
backdrop will to some extent influence 
the scale of our market opportunity in 
the coming year however it is worth 
remembering that the history of the 
group specifically and the specialist 
staffing market more generally 
demonstrates that we do not need 
exceptionally strong economic 
tailwinds as a precondition for strong 
performance indeed it is candidate 
confidence as much as any other 
major factor which drives demand and 
our experience shows that a healthy 
level of candidate confidence is  
not predicated on abovetrend 
economic growth
in addition we are more exposed than 
ever before to markets with strong 
structural growth characteristics 
recent experience in territories 
such as germany suggest that the 
underlying growth of the specialist 
staffing market can act as a powerful 
counterbalance even when economic 
conditions are dire given that the 
balance of opinion suggests at least 
a benign global economic scenario 
for 2011 markets such as these have 
particularly strong potential at the 
same time our longer established 
franchises had all returned to growth 
by the end of 2010 and we have no 
reason to believe that this is a trend 
which will not continue
t aking all the available indicators 
into consideration we feel there are 
justifiable reasons to remain opti
mistic about the forthcoming year 
as always we take confidence that 
our twenty five year track record 
seasoned management team and well 
established brands to provide us with 
an excellent platform to make the 
most of whatever the market has to 
offer us
russell clements
chief executive officer
28 january 2011
chief executive officer’s review 
for the year ended 28 november 2010 continued sthree plc 9
chief financial officer’s review 
for the year ended 28 november 2010
revenue for the year decreased by 
86 to £4745m 2009 £5194m 
gross profit for the year decreased 
by 28 to £1664m 2009 £1712m 
representing a group gross profit 
margin of 351 2009 330 
the group gross profit margin 
increased as a result of the remix 
in business towards permanent 
which represented 49 of gross 
profit in 2010 up from 42 in 2009 
permanent revenues are accounted 
for at 100 gross margin whereas 
contract gross profit is shown after 
the associated cost of sale
administrative expenses before prior 
year exceptional items decreased 
by 52 to £1452m 2009 £1532m 
as the group benefitted from close 
monitoring of costs and made 
efficiency savings on advertising 
spend professional fees motor 
vehicle costs bank charges and a 
number of other such costs as a 
result the group’s conversion ratio 
grew to 128 2009 105
group headcount was 1863 at 28 
november 2010 up 167 on the 
opening headcount at 29 november 
2009 of 1597 average total 
headcount for the year was 1772 
down 37 year on year 2009 1841
profit before t ax increased by 200 to 
£216m 2009 £180m before prior year 
exceptional items are taken into account 
and by 1427 to £216m 2009 £89m 
after prior year exceptional items
t axation on profit before exceptional 
items was £74m 2009 £55m 
representing an effective tax rate 
of 34 2009 31 the increase 
in the effective tax rate was driven 
by a remix of the business towards 
jurisdictions with higher tax rates 
based on the current structure of the 
group and existing local taxation rates 
and legislation it is expected that 
the underlying effective tax rate will 
remain at around this level
basic earnings per share before 
exceptional items were 119p 2009 
95p up 253 this was driven by an 
increase in profit before tax of 200 
partially offset by a higher effective 
tax rate of 34 2009 31 and 
enhanced by a reduction in the profit 
attributable to noncontrolling interest 
holders minority interest participants 
to £01m 2009 £12m which is 
explained further below the weighted 
average number of shares increased 
slightly to 1199m 2009 1187m fully 
diluted earnings per share before prior 
year exceptional restructuring items 
were 115p 2009 92p up 250 
basic earnings per share after prior 
year exceptional restructuring items 
were 119p 2009 40p up 1975 
fully diluted earnings per share  
after prior year exceptional 
restructuring items were 115p  
2009 39p up 1949
during the second half of the year 
the group migrated certain entity
based minority interests to tracker 
share arrangements which fall within 
the scope of ifrs 2 ‘sharebased 
payment’ looking forwards the profit 
attributable to non controlling interests 
minority interest participants will be 
nil as all significant minority interest 
arrangements have moved to tracker 
arrangements the subscription 
price methodology for tracker share 
arrangements is fair market value 
as determined by an independent 
valuation expert and shares may 
be equity or cash settled as the 
participant subscribes at fair market 
value for the award the fair value of the 
award is reduced to nil and therefore 
no ifrs 2 accounting charge arises
the board previously declared an 
interim dividend of 40p per share 
2009 40p the board has declared 
a final dividend of 80p per share 
bringing the total dividend for the year 
to 120p per share 2009 120p the 
final dividend will be paid on 6 june 
2011 to those shareholders on the 
register as at 6 may 2011
balance sheet
the group had net assets of £819m 
at 28 november 2010 2009 £848m 
net cash including term investments 
amounted to £552m 2009 £485m 
the improvement in our cash position 
reflecting the net impact of the 
profitability of the group and the 
improved management of working 
capital during the year
t angible fixed asset capital 
expenditure amounted to £28m 
2009 £27m relating to investment 
in it hardware and the fit out of new 
offices intangible asset additions 
primarily relating to it software 
purchases and development costs 
increased to £29m 2009 £21m 
t otal capital expenditure is planned 
to be slightly ahead of these levels 
in 2011 as the business continues 
its office opening programme and 
invests further in establishing 
an infrastructure to support the 
globalising business
financial review
2010 2009
revenue gross profit revenue gross profit
permanent £817m £814m £724m £988m
contract £3928m £850m £4470m £724m
total £4745m £1664m £5194m £1712m sthree plc 10
chief financial officer’s review 
for the year ended 28 november 2010 continued
as a result of the group gross profit 
growing in h2 by 184 year on year 
to £922m 2009 h2 £779m net 
trade debtors increased by £48m to 
£631m 2009 £583m representing 
dso’s of 37 days 2009 37 days 
and total trade and other payables 
increased from £761m to £862m
cash flow
at the start of the year the group had 
net cash of £485m including assets 
held to maturity of £32m during 
the year the group generated cash 
from operating activities of £318m 
2009 £637m in 2009 the group 
benefitted from a reduction in the 
working capital funding of the reduced 
contractor book this is now partially 
reversing as our contractor book 
grows income taxes paid reduced to 
£60m 2009 £183m
during the year the group paid 
ordinary dividends of £144m 2009 
£144m and dividends to minority 
interest participants of £10m 2009 
£01m the group also invested £35m 
in an a rated unbreakable enhanced 
fixed rate deposit with a maturity of 
less than 6 months at year end
at 28 november 2010 the group had 
net cash of £552m including assets 
held to maturity of £35m
the group has a committed invoice 
discounting facility of £20m with 
royal bank of scotland invoice 
finance “rbs” which expires in 
april 2012 the group is not currently 
drawing down against this facility
treasury management and 
currency risk
the main functional currencies of 
the group are sterling and the euro 
the group has significant operations 
outside the united kingdom and as 
such is exposed to movements in 
exchange rates
the board has undertaken a review 
of its currency hedging strategy 
to ensure that it is appropriate 
and currently the group does not 
actively manage its exposure to 
foreign exchange risk by the use of 
financial instruments the impact of 
foreign exchange will become a more 
significant issue for the group as we 
expect the business mix to move 
further towards international with 
the international business accounting 
for 60 of gross profit in 2010 2009 
55 the group will continue to 
monitor its policies in this area
other principal risks and 
uncertainties affecting the 
business
other principal risks and uncertainties 
affecting the business activities of the 
group are detailed within the directors’ 
report in terms of macro economic 
environment risks as previously 
stated our strategy is to continue 
to grow the size of our international 
business in both financial terms and 
geographic coverage in order to reduce 
the group’s exposure or dependence 
on any one specific economy although 
a downturn in a particular market 
could adversely impact the group’s 
business in the view of the board 
there is no material change expected 
to the group’s key risk factors in the 
foreseeable future
our strong balance sheet and net cash 
give us the confidence to maximise 
the opportunities that lie ahead
alex smith
chief financial officer
28 january 2011 sthree plc 11
group strategic development 
review 
for the year ended 28 november 2010
in my first statement as sthree 
chief development officer i am very 
pleased to report that the group 
was able to significantly expand its 
business globally under our regionally 
focused md structure which was 
created in early 2010
during the year the group was able 
to open new offices in perth delhi 
houston san francisco munich 
and düsseldorf with further offices 
in doha sao paulo antwerp and 
abu dhabi due to open in h1 2011 in 
addition a number of rebranding 
consolidation and other initiatives 
were undertaken and all of this 
was only made possible by the 
strengthening of the strategic 
development team and creation 
of a cross functional ‘strategic 
implementation group’ ‘sig’ 
consisting of groupwide experts 
in order to share and evolve best 
practice which is essential as 
we move into newer regions and 
sectors this was underpinned by our 
thorough new venture risk evaluation 
processes which are core to  
expanding using our business model
new venture risk evaluation 
processes
as part of an evolving strategic 
planning and implementation five 
year plan each new venture is firstly 
risk categorised by colour coding 
according to the degree of associated 
risk and this is used to develop 
detailed review and implementation 
processes which are appropriate to 
the new venture being proposed 
with stages typically including 
early warning research planning 
implementation evaluation and post 
implementation evaluation t ypical 
risk categories for monitoring and 
reporting include the following
complex ventures operationally will definitely require external resources
ventures in new territory in some cases external resources may aid us
ventures where sthree has some experience in the country but the venture 
incurs a higher operational risk than amber ventures ie complex regulation 
a european country which we have extensively tested but have no physical 
presence
ventures where sthree has a presence in the country but not in the city
ventures where sthree already has a presence in the city
a brand expanding into a new sector
i
n
c
r
e
a
s
i
n
g
r
i
s
k
this ensures that we are able to 
identify the success factors which 
are critical to ensure successful 
expansion into our new sectors and 
emerging markets and in doing so
  drive our organisational culture into 
new territories
  prioritise a risk perspective for 
ethical and other relevant issues 
as part of our regular internal audit 
reviews and
  ensure careful analysis of 
performance recognising that high 
profit and growth may sometimes 
be a ‘no go’
as a result the group now has an even 
more diversified business both in 
terms of geographic and sector spread 
and with each passing year our non 
uk gross profit represents an ever 
increasing share of the group’s overall 
gross profit however whilst our tried 
and tested strategy remains primarily  sthree plc 12
group strategic development 
review continued 
for the year ended 28 november 2010
focused on pursuing organic growth 
we remain open to and are continually 
assessing other market opportunities 
as they arise
our processes are built on tried and 
tested risk governance procedures 
incorporating the below key elements 
within each countryspecific risk 
assessment
in my role as chief development 
officer i am excited by the 
opportunities available and look 
forward to creating an even more 
diversified group in 2011
 
gary elden 
chief development officer 
28 january 2011
riskgovernance 
landscape
governance
oversight
antifraud 
strategy 
 policies
hiring  
promotion
crisis response
misappropriation
 reporting
financial 
reporting risks
general risks
controls  
evalution
management
information 
systems
communication
awareness  
training
gatekeeper
role
management 
oversight
governance oversight
clear responsibilities in place for the board and its committees in 
respect of oversight of risks controls and ongoing effectiveness
antifraud strategy  policies
a clear strategy around fraud policies to 
coordinate ongoing activity for the 
prevention and detection of bribery and fraud
hiring  promotion
performance of rigorous 
background checks on new 
employees and those being 
promoted into a position of trust 
including verification of the 
content of an applicants cv
crisis response
documented procedures and 
controlled response plan 
established for recording 
tracking and responding to 
potentially harmful allegations
misappropriation  
reporting
regular review of attitudes 
incentives or pressures and 
opportunities to breach the control 
environment and assessment of 
the potential exposure arising from 
each of the categories of financial 
or other risk across the 
organisation
general risks
consideration of the total risk landscape including corruption 
price fixing money laundering bribery and other risks
controls  evaluation
regular assessment of whether identified risks including 
fraud risks are mitigated by existing controls and the 
operating effectiveness of these controls
management information 
systems
establishing effective channels 
to promote the flow of quality 
information up down and across 
the organisation
communication 
awareness  training
providing fraud awareness 
training for employees for 
example as part of the 
induction programme and 
ensuring that this is regularly 
updated in line with bribery 
and other legislation
gatekeeper role
ensuring that the internal 
audit plan addresses fraud 
risk and the controls 
designed to mitigate this 
with internal audit reporting 
to the audit committee on a 
regular basis
management oversight
adequate procedures established to ensure that on a 
regular and continuing basis senior management 
consider the effectiveness of the control environment 
and whether the risk assessment and therefore the 
mitigating controls requires amendment or update
financial reporting risks
compliance with accounting standards and best 
practice in our financial reporting sthree plc 13
directors’ report 
for the year ended 28 november 2010
the directors present their annual 
report on the activities of the group 
together with the financial statements 
and auditors’ report for the year ended 
28 november 2010
group business review 
principal activities and risks 
facing the business
the chairman’s statement chief 
executive officer’s and chief financial 
officer’s reviews and the group 
strategic development review taken 
together with this directors’ report 
provide information relating to the 
group’s activities its business and 
strategy and principal risks and 
uncertainties faced by the business 
including analysis using financial 
and other kpis where necessary 
these together with the directors’ 
remuneration report corporate 
governance and corporate social 
responsibility reports provide an 
overview of the group including 
environmental and employee 
matters and give an indication of 
future developments in the group’s 
business this provides a balanced 
and understandable assessment of 
the group’s position and prospects in 
accordance with the business review 
requirements of the companies 
act 2006 sthree is a specialist 
permanent and contract staffing 
business currently comprised 
of four main operating brands 
computer futures huxley associates 
progressive and real staffing group 
all of which operate under a well 
established multibrand strategy 
the first office as computer futures 
opened in london in 1986 whilst 
international expansion started in 
1998 with the launch of an office in 
brussels each brand shares common 
services such as finance information 
services human resources and legal 
the group has grown organically 
and has a diverse client base of over 
7000 clients offices are currently 
located in europe usa asiapacific 
and middle east with further offices 
planned to be opened in 2011 from our 
wellestablished position in the ict 
sector the group has broadened its 
operations by building fastgrowing 
businesses serving the engineering 
 energy banking accountancy 
 finance pharmaceuticals and 
job board sectors the group began 
trading on the london stock exchange 
in november 2005 and in 2007 
launched a us level one adr facility 
sthree has a selective approach to 
clients and focuses on high margin 
opportunities predominantly within 
the small to mediumsized enterprises 
‘smes’ market and from its inception 
the group has avoided the high 
volume low margin business model 
in favour of a focus on high quality 
business
the group’s main subsidiary 
undertakings are disclosed in the 
notes to the financial statements 
during the year the group initiated 
a corporate simplification project 
and as a result ended 2010 with a 
much reduced number of subsidiary 
companies this project will continue 
into 2011
business model
sthree specialises in placing both 
permanent and contract staff in niche 
segments of the staffing market 
with the ultimate aim of being the 
most respected and highly valued 
international specialist staffing 
services business our highly 
successful business model is built 
around the following key factors
•
  the group’s medium to long term 
strategy is to roll out the sthree 
model to an increasing number of 
geographies and across a range of 
specialist staffing disciplines at 
the same time the group does not 
neglect the importance of its longer 
established franchises
•
  our default assumption is that the 
strategy will be based on organic 
growth
•
  a key element of our strategy is 
that we remain highly selective 
regarding the quality of the 
business we undertake focusing 
on high margin business
•
  our customer base is wide and 
varied with a high percentage 
of smes small and medium 
enterprises particularly in the uk
•
  our multibrand approach allows 
us to segment the market around 
specific niches this allows us 
to credibly position ourselves as 
market experts which in turn 
justifies a premium pricing position
•
  our entrepreneurial culture is 
reinforced by our ‘t racker share’ 
minority interest model which is 
both a significant retention tool 
as well as a unique proposition to 
attract the brightest and best talent 
into the group
key performance indicators 
“kpis”
both financial and nonfinancial key 
performance indicators kpis are 
used throughout the group to monitor 
progress with the principal indicators 
listed in the table following where 
these relate to a strategic or group 
level appropriate analysis is provided 
within the chief executive officer’s and  sthree plc 14
directors’ report continued 
for the year ended 28 november 2010
kpis financial 2010 2009 definition and method of calculation
revenue £4745m £5194m t otal fees earned by the group before any cost deductions
gross profit £1664m £1712m revenue less cost of sales also known as net fee income
profit before t ax £216m £180m  gross profit less administration expenses and finance incomecosts before 
exceptional items
total shareholder return ‘tsr’ 16 105  tsr is defined as share price growth plus dividends attributable to shareholders 
over a specific period this measure is also used for the group’s l tip  over a three 
year period
adjusted earnings per share ‘eps’ 119p 95p  adjusted eps is defined as profit before exceptional items for the year 
attributable to the group’s equity shareholders divided by the weighted average 
number of shares in issue during the year this measure is also used for the 
group’s l tip  over a three year period
group gross margin 351 330  gross profit as a percentage of revenue
contract margin 216 221  contract gross profit as a percentage of contract revenue
gross profit per day rate £8570 £8469  contract gross profit per average number of working days
permanent fees £123k £119k  average fees of permanent placements that started during the period
geographical diversification – 60 55 split of gross profit by location of client
international mix
sectoral diversification – non ict 38 28  split of gross profit by candidate skill set
contractperm mix 5149 5842  proportion of gross profit attributable to contract and permanent placements
conversion ratio 128 105  the conversion ratio is the operating profit stated as a percentage of gross profit 
and measures how effective the group is at controlling the costs and expenses 
associated with its normal operations and its level of investment for the future
cash conversion 123 326  cash conversion is calculated as the cash flows from operating activities for the 
year after deducting net normal capex stated as a percentage of operating profit 
before exceptional items and is a measure of the group’s ability to convert profit 
into cash
debtor days ‘dsos’ 37 37  represents the length of time it takes the company to receive payments from its 
debtors it is calculated by comparing how many days’ billings it takes to cover 
the debtor balance
kpis non financial
risk management  as detailed within the corporate governance report the group has continued to roll out its erm 
framework throughout the business and has consequently further developed and enhanced its 
risk evaluation and erm reporting mechanism using an ebitda measurement scale
  during 2010 key executive job descriptions were redrafted to include reference to risk 
responsibility with annual bonus also linked to up to 20 of the bonus opportunity and relating 
directly to progress towards the company’s strategic objectives in support of managing any 
related business risk and including meaningful compliance elements for all senior individuals
headcountchurn  this is the measure of employee retention lower churn and higher headcount retention generally 
means increased productivity it is also an indicator of morale
environmental  in late 2008 a strategic decision was made to conduct a companywide initiative to measure our 
carbon footprint and reduce energy consumption whilst taking steps to increase recycling by 50 
as detailed within the csr report
interviews number of interviews conducted by consultants per period
credit risk assessment  during 2010 the group developed a credit policy which sets out certain minimum requirements in 
order to do business with a potential customerclient
strategic development strategy  during 2010 the group significantly enhanced its strategic development capabilities to fully 
assess emerging market risks off strategy risks development pipeline and agreed other new 
venture minimum kpis
compliance  minimum contractor compliance standards in respect of clientcontractor terms and rates
durationtypes and id collection zero tolerance on code of conduct breaches or fines sthree plc 15
chief financial officer’s reviews for 
financial kpis comparison figures are 
shown for both the current and prior 
year whereas for nonfinancial kpis 
no figures are generally applicable the 
actual kpis used will generally depend 
on the split of business eg whether 
it is contract or permanent as well as 
specific sector or geography annual 
bonuses are linked to a mixture of 
these kpis as well as other measures 
depending on the specific role of the 
individual concerned
principal risks and 
uncertainties
the principal risks facing the business 
include the following
macroeconomic environment
cyclicality – the performance of 
the group has a relationship and 
dependence on the underlying 
growth of the economies of the 
countries in which it operates in so 
far as it impacts client and candidate 
confidence 2010 saw an improving 
picture across all markets although 
still not fully recovered by historical 
standards this is mitigated in part by 
maintaining
•
  a balance of temporary and 
permanent recruitment
•
  a broad exposure across 
geographies and sectors
•
  a flexible cost base that enables 
us to react swiftly to changes in 
market conditions by increasing or 
reducing costs as appropriate and
•
  a strong balance sheet with 
manageable debt levels
a key part of the group’s strategy 
is to continue to grow the size of its 
international businesses to reduce the 
group’s reliance on any one specific 
economy geography or sector
competitive environment – the group 
continues to face competitor risk 
in the markets where the provision 
of permanent and temporary 
recruitment is most competitive 
and fragmented being generally 
the uk ireland and the netherlands 
there is strong competition for 
clients and candidates although we 
generally resist pricing and margin 
pressures across our major specialist 
activities the group’s strategy is to 
continue to grow its international 
businesses more aggressively in other 
geographies and sectors including 
the lessdeveloped markets of asia 
pacific and rest of the world to 
focus on more specialist niches 
which tend to be less competitive 
whilst also improving the efficiency 
and operations of our businesses 
throughout the organisation
in continental europe and many 
parts of the world the markets for 
the provision of recruitment services 
are somewhat less developed and 
the market place is also fragmented 
where these markets are still in a 
development phase pricing pressure 
is less of a risk and our strategy is to 
rapidly grow our businesses in these 
territories
competitors in our markets are 
typically small boutique privately 
owned businesses in all of our 
markets we are continually subject 
to both existing and new competitors 
entering into the markets in which 
we operate in terms of geographic 
region and specialist activity the 
competitive threat is from both 
small startup operations and large 
multinationals attempting to enter 
the specialist market as the costs 
of entry into specialist recruitment 
can be relatively low although these 
costs have risen with increased levels 
of compliance required from local 
regulators and clients
commercial relationshipscustomer 
credit risk – the group benefits from 
close commercial relationships with 
key clients in both the private and 
to a much lesser extent the public 
sectors although it is not dependent 
on any single key client however 
like most companies the group is 
always subject to the risk that some 
customers might be unable to fulfil 
obligations which could impact 
results
availability of candidates – the 
availability of highly skilledquality 
candidates is essential to operating 
in nichehigh margin areas changes 
in the other risk areas can affect 
candidate supply
contractual risk – clients increasingly 
require more complex levels of 
compliance in their contractual 
arrangements the group takes 
these responsibilities seriously 
and contracts are therefore closely 
controlled via the group’s centralised 
legal and business administration 
functions and subject to regular audit 
by the internal audit function in order 
to reduce the risk of noncompliance 
the group also has clear guidance 
on the approval of contractual 
terms and monitors the application 
thereof especially any exceptions 
to our standard liability position and 
insurance protection which require 
the approval via the legal department 
and group company secretary 
the placing of temporary workers 
generally represents greater risk for 
the organisation than permanent 
placements wherever possible 
contracts include clauses which place 
the responsibility for supervision and 
control of each contractor directly 
with the client excluding any 
consequential loss and limiting the 
group’s aggregate liability under the 
contract
directors’ report continued 
for the year ended 28 november 2010 sthree plc 16
people – the group is heavily reliant on 
the ability to recruit train and develop 
people to meet its growth strategy 
at the same time the group’s 
business model demands flexibility 
to expand or consolidate depending 
on the economic environment in 
response to this the group is focused 
on engaging with and developing 
its key managers in each sector 
geography and is committed to 
ensuring it has competitive pay and 
benefits structures clearly linked 
to performance combined with 
a succession planning process 
through training and development 
it seeks to provide individuals with 
the leadership sales key customer 
management and general business 
skills that support the group’s 
expansion needs whilst providing a 
rewarding and challenging career 
regional and country managers 
are also focused on allocating 
resources in respect of the best 
group opportunities available
information t echnology – the group 
is reliant on delivering its service 
to clients through a number of 
technology systems these are 
housed in various locations and the 
group has capacity to cope with 
a data or system loss as a result 
of a significant event through the 
establishment of disaster recovery 
sites that are physically based in 
separate locations to the ongoing 
operations the group is also reliant 
upon a number of important suppliers 
that provide critical information 
technology infrastructure it 
continually monitors the performance 
and robustness of these suppliers to 
ensure businesscritical processes are 
safeguarded as far as is practicably 
possible whilst the group replaced its 
financial systems in 2006 these are 
periodically reviewed to ensure they 
are fully utilised and remain effective 
in order to reduce any risks associated 
in upgrading key operational 
and financial systems project 
management teams are appointed 
including specialist it  operational 
and external resource utilising 
robust management tools which 
monitor progress across the life of any 
project the business also continues 
to review and enhance its ability to 
cope with a significant data or other 
loss via its business continuity plan 
arrangements
regulatory environment and legislative 
changes – the specialist recruitment 
industry is governed by increasing 
levels of compliance which vary 
from country to country and market 
to market the group is committed 
to meeting all of its regulatory 
responsibilities and continues to 
strengthen its internal controls 
and processes with respect to legal 
and contractual obligations as 
employment laws are changed and 
harmonised in certain geographies 
this creates new risks and 
opportunities the contract market is 
more heavily regulated and changes 
in legislation such as changes in 
managed service company legislation 
or to contract worker rights may 
impact the group the group 
ensures that its policies processes 
and systems reflect best practice 
wherever possible in order to meet the 
legal requirements of the markets in 
which it operates
foreign exchange – the group has 
significant operations outside the 
united kingdom and is therefore 
exposed to movements in exchange 
rates as profits from the eurobased 
markets increase in proportion to 
the group’s total profits the foreign 
exchange risk also increases the 
board has undertaken a review of 
its currency hedging strategy to 
ensure that it is appropriate and 
currently the group does not actively 
manage its exposure to foreign 
exchange risk by the use of financial 
instruments however the impact of 
foreign exchange will become a more 
significant issue as the business mix 
moves further towards international 
and the group will therefore continue 
to monitor its policies in this area via 
its t reasury function
post balance sheet events
there have been no significant events 
since the balance sheet date
results and dividends
information in respect of the group’s 
profits dividends and other key 
financial information is contained 
within the chairman’s statement the 
chief executive officer’s and chief 
financial officer’s reviews
directors and their interests
the current directors of the 
company including biographies are 
shown within the section ‘board of 
directors and secretary’ as set out 
earlier in this annual report with 
further details of board committee 
membership being set out within 
the corporate governance report 
all directors served throughout the 
financial year except clay brendish 
who was appointed as chairman on 
1 may 2010 succeeding sir anthony 
cleaver who retired as chairman at 
the annual general meeting on 23 april 
directors’ report continued
for the year ended 28 november 2010 sthree plc 17
directors’ report continued 
for the year ended 28 november 2010
2010 sunil wickremeratne also retired 
as a director on 30 november 2010 
although not yet formally required 
in accordance with the uk corporate 
governance code all directors will 
retire at the 2011 agm and submit 
themselves for reelection further 
information is contained in the notice 
of meeting
other than employment contracts and 
minority interest loans to gary elden 
none of the directors of the company 
had a material interest in any contract 
with the company or its subsidiary 
undertakings the key terms of the 
directors’ service contracts the 
directors’ interests in the shares and 
options of the company and minority 
interest loans to gary elden in respect 
of minority interests approved prior 
to him becoming an sthree plc 
director are disclosed in the directors’ 
remuneration report
supplier payment policy 
essential contractors and 
change of control
it is the group’s policy to comply with 
terms of payment negotiated with 
suppliers where payment terms are 
not negotiated the group endeavours 
to adhere to the suppliers’ standard 
terms sthree plc acts as a holding 
company for the group and does not 
trade and consequently does not 
have an average creditors’ payment 
period t rade creditors of the group at 
28 november 2010 were equivalent to 
24 days’ purchases 2009 21 days 
the group has business relationships 
with a number of contractors but is 
not reliant on any single one
there are no significant agreements 
to which the company is party that 
take effect alter or terminate upon 
a change of control of the company 
following a takeover offer with the 
exception of the rbs invoice finance 
agreement regarding the group’s 
invoice discounting facility dated 
8 october 2009
the company does not have 
agreements with any director 
or employee that would provide 
compensation for loss of office 
or employment resulting from a 
takeover except that provisions of the 
group’s share plans and tracker share 
‘minority interest’ arrangements 
may cause options awards or 
minority shareholdings to vest on a 
takeover
share capital
the authorised and issued share 
capital of the company together 
with details of the movements in the 
company’s issued share capital during 
the year are shown in the notes to the 
financial statements
‘tracker share’ arrangements 
formerly minority interests 
‘mi’ model
since flotation the group has 
regarded its t racker share 
arrangements or minority stakes 
model as a key factor in its success 
and it is planned to create more of 
these this year on similar terms to 
those previously created subject to 
shareholder approval at the agm in 
april 2011
entrepreneurial employees within 
the group often create ideas for 
new business opportunities which 
the group may elect to pursue and 
develop historically the group has 
engaged with such key employees in 
setting up new brands for the purpose 
of pursuing these new ideas which 
have typically evolved organically 
out of one of the existing sthree 
businesses for example jp gray was 
established as a result of an idea 
presented to the directors by certain 
senior managers of computer futures 
who were then given the opportunity 
to manage and develop that new 
brand t ypically those managers of 
the new sthree brand will be able to 
invest at the company’s discretion 
in the new venture and share in its 
success as well as the risk of failure
as in prior years only the group’s key 
entrepreneurial employees may be 
invited to invest in the creation of any 
new tracker share business in order 
to receive equity ownership such 
employees must invest in any stake at 
fair value and be actively engaged in 
that business for a minimum term of 
between three and five years should 
the employee wish to dispose of their 
stake the company retains pre
emption rights
the minimum term for each new 
tracker share stake will be set at the 
outset and will normally be five years 
but will never be less than three years 
in order to allow the group flexibility 
to adapt to the individual needs of its 
brands and businesses and differing 
rates of growth sthree plc 18
directors’ report continued
for the year ended 28 november 2010
although there are a number of 
different businesses in which 
key employees will be invited to 
invest each invitation will be on 
generally similar terms to that used 
previously and it is normally therefore 
appropriate to put only one resolution 
to shareholders each year
also note that for all prior 
shareholder authorities granted 
the five year period available to the 
company to make such offers to 
employees is to be renewed from the 
date of each annual general meeting 
or any adjournment thereof
the proposed resolution together 
with the standard terms upon which 
the tracker shares are normally 
based are outlined within the notice 
of meeting
authority to make purchases 
of own shares
the company is until the date of the 
forthcoming annual general meeting 
generally and unconditionally 
authorised to buy back a proportion 
of its own ordinary shares during 
the year no purchases were made 
although the directors will seek to 
renew the authority for up to 10 of 
the company’s issued share capital at 
the annual general meeting
directors’ indemnities 
insurance and conflicts of 
interest
section 236 of the companies act 
2006 allows companies the power 
to extend indemnities to directors 
against liability to third parties 
excluding criminal and regulatory 
penalties and also to pay directors’ 
legal costs in advance provided that 
these are reimbursed to the company 
should the individual director be 
convicted or in an action brought 
by the company where judgement 
is given against the director the 
company currently has a directors’ 
and officers’ insurance policy in place 
which provides this cover
the board also confirms that there 
are appropriate procedures in place 
to ensure that its powers to authorise 
any directors’ conflicts of interest 
operated effectively during the year
corporate governance
please refer to the separate corporate 
governance report
financial instruments
information in respect of financial 
instruments is set out in the notes to 
the financial statements
substantial shareholdings
as at the date of this report the group had been notified in accordance with the companies act of the following 
significant interests in the ordinary share capital of the company although note that any interests of directors which 
amount to over 3 are shown in the directors’ interests table within the directors’ remuneration report
name of holder number of shares percentage shareholding
axa 5153356 423
simon peter arber 3392047 279
blackrock 6212461 510
william frederick bottriell 9327764 766
fidelity 6028475 495
hbos plc 6983314 521
jp morgan asset management uk limited 7021061 507
legal  general group plc 4841179 397
martin currie investment management limited 4314627 312
standard life investments limited 10977355 902 sthree plc 19
corporate and social 
responsibility
the board recognises its 
environmental health and safety 
and employment responsibilities 
and devotes appropriate resources 
towards monitoring compliance with 
and improving existing standards 
the chief executive officer has 
responsibility for these areas at 
board level ensuring that the group’s 
policies are upheld and providing 
the necessary resources further 
information is contained in the 
corporate social responsibility  
report section
health and safety – the group is 
committed to providing for the health 
safety and welfare of all its employees 
every effort is made to ensure that 
the requirements of the health and 
safety at work etc act 1974 and all 
other relevant regulations and codes 
of practice are complied with
employees – the group has 
continued its policy of informing all 
employees of matters of concern 
to them as employees both in their 
immediate work situation and in the 
wider context of the group’s well 
being it encourages participation 
and involvement in matters which 
affect their interests as employees 
communication with employees 
is effected through the group’s 
management briefings structure 
board committees formal and 
informal meetings and through the 
group’s information systems informal 
communication is facilitated by emails 
to all group companies
the group is also committed to 
achieving equal opportunities and to 
complying with antidiscrimination 
legislation in addition employees 
are encouraged to train and develop 
their careers it is established group 
policy to offer employees and job 
applicants the opportunity to benefit 
from fair employment without regard 
to their sex sexual orientation marital 
status race religion or belief age or 
disability
the group gives full and fair 
consideration to the employment of 
disabled persons for suitable jobs 
in the event of members of staff 
becoming disabled every effort is made 
to ensure that their employment within 
the group continues either in the job or 
in a suitable alternative it is the group’s 
policy to support disabled employees 
in all aspects of their training 
development and promotion where it 
benefits the employee and the group
information on employee share plans 
and share ownership is contained in 
the directors’ remuneration report
the community – the group is 
committed to providing support to 
the community and society through a 
number of charitable activities during 
the period the group made charitable 
donations of £64957 2009 £51000 
the group made no donations for 
political purposes either in the uk or 
overseas during the year
annual general meeting
the annual general meeting of the 
company will be held on 21 april 2011 
at the westbury hotel bond street 
mayfair london w1s 2yf  a separate 
formal notice of meeting details all 
business to be transacted
auditors
as required by section 4182 of the 
companies act 2006 each director 
in office at the date of this report 
hereby confirms that
•
  so far as the director is aware 
there is no relevant audit 
information of which the 
company’s auditors are unaware 
and
•
  heshe has taken all steps that 
heshe ought to have taken as 
a director in order to make him
herself aware of any relevant audit 
information and to establish that 
the company’s auditors are aware 
of such information
pricewaterhousecoopers llp have 
indicated their willingness to continue 
in office accordingly a resolution 
will be put to the forthcoming annual 
general meeting proposing their 
reappointment as auditors for the 
ensuing year
statement of directors’ 
responsibilities
the directors are responsible for 
preparing the annual report the 
directors’ remuneration report 
and the financial statements in 
accordance with applicable law and 
regulations
directors’ report continued 
for the year ended 28 november 2010 sthree plc 20
company law requires the directors 
to prepare financial statements for 
each financial year under that law 
the directors have prepared the 
consolidated group and company 
financial statements in accordance 
with international financial reporting 
standards ifrss as adopted by the 
european union under company 
law the directors must not approve 
the financial statements unless they 
are satisfied that they give a true 
and fair view of the state of affairs 
of the consolidated group and the 
company and of the profit or loss of 
the company and consolidated group 
for that period in preparing these 
financial statements the directors are 
required to
•
  select suitable accounting policies 
and then apply them consistently
•
  make judgements and accounting 
estimates that are reasonable and 
prudent
•
  state whether applicable ifrss as 
adopted by the european union 
have been followed subject to 
any material departures disclosed 
and explained in the financial 
statements
•
  prepare the financial statements on 
the going concern basis unless it is 
inappropriate to presume that the 
company will continue in business
the directors are responsible for 
keeping adequate accounting records 
that are sufficient to show and explain 
the company’s transactions and 
disclose with reasonable accuracy 
at any time the financial position of 
the company and the consolidated 
group and enable them to ensure 
that the financial statements and 
the directors’ remuneration report 
comply with the companies act 2006 
and as regards the consolidated 
group financial statements article 
4 of the ias regulation they are 
also responsible for safeguarding 
the assets of the company and 
the consolidated group and hence 
for taking reasonable steps for the 
prevention and detection of fraud and 
other irregularities
the directors are responsible for the 
maintenance and integrity of the 
company’s website legislation in 
the united kingdom governing the 
preparation and dissemination of 
financial statements may differ from 
legislation in other jurisdictions
each of the directors whose names 
and functions are listed above confirm 
that to the best of their knowledge
•
  the consolidated group and 
company financial statements 
which have been prepared in 
accordance with ifrss as adopted 
by the european union give a 
true and fair view of the assets 
liabilities financial position and 
profit of the consolidated group 
and company and
•
  the directors’ report together 
with the chairman’s statement 
the chief executive officer’s and 
chief financial officer’s reviews 
contained in the annual report 
includes a fair review of the 
development and performance of 
the business and the position of the 
consolidated group and company 
together with a description of the 
principal risks and uncertainties 
that it faces
by order of the board 
steve hornbuckle
group company secretary
28 january 2011
registered office 
5th floor 
215227 great portland street 
london w1w 5pn
directors’ report continued
for the year ended 28 november 2010 sthree plc 21
directors’ remuneration report
for the year ended 28 november 2010
introduction
this report has been prepared in 
accordance with the companies 
act 2006 and the directors’ 
remuneration regulations 2002 
relevant provisions of the listing 
rules and although not yet 
formally required the uk corporate 
governance code
the regulations require the 
auditors to report to the company’s 
shareholders on the ‘auditable part’ of 
the directors’ remuneration report 
and to state whether in their opinion 
this part of the report has been 
properly prepared in accordance with 
the companies act 2006 as amended 
by the regulations the report has 
therefore been divided into separate 
sections for unaudited and audited 
information and as required by the 
regulations a resolution to approve 
the report will be proposed at the 
forthcoming annual general meeting
year in focus – summary
•
 no base salary increases 
awarded during the year ended 
28 november 2010 having regard 
to the economic background 
which existed at the time of the 
annual review and the associated 
impact on the majority of the 
group’s employees
•
 l tip eps performance targets for 
2010 reviewed and toughened
•
 up to 20 of bonus opportunity 
now relates to strategic 
objectives in support of future 
profitability and managing 
business risk including 
meaningful compliance elements 
for all senior individuals
•
 continued offering of two uk all 
employee share schemes saye 
and sip with other countries 
being added to deliver the 
policy of significant employee 
shareholder participation
unaudited information
remuneration committee
the remuneration committee 
the ‘committee’ determines 
the remuneration policy and the 
individual remuneration packages 
of the chairman the executive 
directors the group company 
secretary and certain key senior 
management posts the committee’s 
t erms of reference were updated 
during 2010 particularly in the light 
of the uk corporate governance code 
and icsa best practice guidelines and 
are available at wwwsthreecom
during the year the committee 
comprised only independent non 
executive directors being t ony 
ward chairman alicja lesniak 
and nadhim zahawi the chief 
executive officer group hr director 
and remuneration advisors regularly 
attend meetings by invitation except 
for matters related to their own 
remuneration the committee met 
four times during the year and no 
member of the committee has any 
personal financial interest other 
than as a shareholder in the matters 
decided
t o help achieve its objectives 
following a review of various providers 
undertaken in 2007 the committee 
appointed deloitte llp ‘deloitte’ as 
its remuneration advisor during the 
year the committee took independent 
advice from deloitte in relation 
to remuneration matters and on 
share incentive arrangementstax 
efficiencies for which it paid £41500 
2009 £44825 excluding vat 
deloitte have also undertaken tax 
services for the company
remuneration policy
the remuneration policy has been 
designed to ensure that the group 
has the capability to attract and 
retain directors and senior managers 
of a high calibre to align the interests 
of senior management with those 
of shareholders and be compliant 
with recommended practice 
individual pay levels are determined 
by reference to comparative 
market conditions performance 
experience and potential in setting 
the policy the committee considers 
for benchmarking purposes the 
remuneration of relevant senior 
management in comparable quoted 
or similar companies
there are three main elements of the 
remuneration package for executive 
directors
•
 fixed pay – basic annual 
salary and benefits including 
company car allowance pension 
contributions and health 
insurance cover
•
 variable annual pay – cashshare 
based bonus payments and
•
 variable long term pay – share
based longterm incentives
in setting the policy on total 
remuneration the group’s policy 
is to position the base salaries of 
directors and senior management 
at between lower quartile and 
median for the relevant comparative 
market with a higher than average 
proportion of their remuneration  sthree plc 22
directors’ remuneration report
for the year ended 28 november 2010 continued
being performance related this policy 
was examined by deloitte during the 
last benchmarking exercise and will 
continue to be reviewed to ensure that 
it remains appropriate
executive directors’ 
basic salary and pension 
arrangements
the basic annual salaries of the 
executive directors for the year ended 
28 november 2010 were russell 
clements £317000 gary elden 
£241500 alex smith £235400 
and sunil wickremeratne £266500 
salaries are normally reviewed in 
december each year and during 
2010 the committee undertook a 
benchmarking of total compensation 
with the support of deloitte the 
committee concluded from the 
available market data and also having 
considered the latest proposals for 
salary and benefits increases within 
the group that the base salary 
level for russell clements remained 
significantly below the comparable 
market level whilst alex smith has 
now firmly established himself within 
his role as a fully competent cfo for a 
ftse 250 size business but was also 
behind the comparable market level  
in addition sunil wickremeratne 
coo left the business at the end 
of november 2010 and is not to 
be replaced at board level for the 
foreseeable future
the committee indicated within the 
2008 and 2009 annual reports that it 
would look to make salary increases 
of no more than 10 per year in order 
to attain the required level however 
for 2010 the committee decided to 
freeze salaries at their existing levels 
with the proviso that it would resume 
its policy of making sure that salaries 
were adjusted to a level between the 
lower quartile and the median of the 
data when it was appropriate to do so
given the above circumstances 
benchmark differentials have 
increased to the extent that they are 
currently in the region of 27 for 
russell clements and 11 for alex 
smith therefore the committee 
feels that a salary increase of 99 
is appropriate for both in recognition 
of the benchmark comparisons 
personal performance and experience 
accumulated in their respective roles 
with a 99 increase also appropriate 
for gary elden in view of his additional 
board responsibilities following the 
departure of the coo all of these 
increases are to be applied from 
1 december 2010
executive directors also receive 
an employer’s contribution to their 
personal pension schemes equivalent 
to 10 of their basic salaries subject 
to each executive director making 5 
personal contributions bonuses and 
benefits are not pensionable
annual bonus scheme
executives receive annual bonus 
payments based on the achievement 
of group targets for profit cash and 
specific group objectives agreed by 
the committee with up to 20 of the 
bonus opportunity relating directly 
to progress towards the company’s 
strategic objectives in support of 
managing any related business risk 
the maximum bonus opportunity for 
executive directors is 120 of salary 
although for individuals below board 
level this is uncapped with deferral 
into shares for any achievement 
over 100 of salary vesting in equal 
tranches over two years provided 
the executive remains employed 
with the group where agreed targets 
are achieved 50 of salary is paid 
with maximum bonus payable for 
achieving 110 of target and with 
pro rata payment for achievement 
between 90 and 110 of target no 
bonus is paid for achievement below 
90 of target
based on the committee’s 
assessment of the performance 
during the year against the profit 
cash and strategic targets for 
growth and international expansion 
mostly in continuing difficult market 
conditions an average bonus equal to 
11326 of salary was accrued for all 
executive directors the committee 
considers overall performance 
including risk management as well as 
environmental social and governance 
‘esg’ issues when calibrating the 
remuneration of executives to ensure 
that the incentive structure for senior 
management does not inadvertently 
encourage irresponsible behaviour
long term incentive plan
in november 2006 shareholders 
approved a sharebased l tip for 
executive directors and other 
members of the senior management 
team to provide an incentive to 
increase shareholder value and 
support alignment with shareholder 
interests through building a stake 
in sthree shares no further awards 
are planned to be made under the 
executive share option scheme 
operated by the company before 
flotation
during 2009 the committee 
commissioned deloitte to review 
the long t erm incentive plan ‘l tip’ 
performance criteria and concluded 
that in addition to the relative 
t otal shareholder return ‘tsr’ 
measure an earnings per share 
‘eps’ growth measure should be 
introduced to ensure that executives 
are appropriately incentivised 
and rewarded with each separate 
measure applying to 50 of the total 
l tip award
l tip awards made in february 2010 
were granted with eps targets of rpi 
plus 5 pa minimum vesting and 
rpi plus 10 pa maximum vesting 
u10224pp2128indd   22 2211   142939 sthree plc 23
directors’ remuneration report
for the year ended 28 november 2010 continued
 company’s tsr ranking against  
percentage of award that comparator group over performance  company’s eps growth over 
vests period performance period
none below median below rpi plus 6 pa
30 median rpi plus 6 pa
80 na rpi plus 13 pa or better
100 upper quartile or better rpi plus 15 pa or better
pro rata on a straight line  between median and upper quartile between rpi plus 6 pa and 
between 30 and 100  rpi plus 13 pa and between
tsr and 30 and 80 and  rpi plus 13 pa and rpi plus
80 and 100 eps  15 pa
however in the light of the steadily 
improving economic conditions and 
having taken into account the views 
of major shareholders these targets 
were toughened to rpi plus 6 pa 
minimum vesting and rpi plus 13 
pa maximum vesting t argets are 
reviewed annually by the committee 
in the light of the current trading 
environment and for awards to be 
granted in february 2011 eps targets 
of rpi plus 6 pa minimum vesting 
rpi plus 13 pa 80 vesting and rpi 
plus 15 pa maximum vesting have 
been approved
the main features of the l tip are as 
follows
•
 awards of shares can be made 
each year to executive directors 
and other senior executives in the 
form of forfeitable shares or share 
options nilcost or market value
•
 the maximum annual face value 
of awards which may be made 
to executive directors is 175 of 
salary whilst over a threeyear 
period the committee intends that 
no executive director will receive 
aggregate awards in excess of a 
face value of 450 of salary
•
 all executive directors’ awards 
must be subject to a performance 
condition assessed over the 
three years following the date 
of grant with no facility to 
retest performance for other 
participants the committee has 
discretion to decide whether 
or not a performance condition 
should apply to grants
•
 the current tsr peer group 
consists of some 40 uklisted 
companies all being recruitment 
or service companies from the 
ftse support services aim or 
fledgling indices as follows 
empresaria group plc experian 
plc garner plc harvey nash group 
plc hays plc healthcare locums 
plc hexagon human capital 
plc highams systems services 
group plc hyder consulting plc 
hydrogen group plc impeilam 
group plc interquest group plc 
kellan group plc management 
consulting group plc matchtech 
group plc michael page 
international plc mitie group plc 
morson group plc mouchel group 
plc network group holdings plc 
networkers international plc 
office2office plc penna consulting 
plc pinnacle staffing group plc 
prime people plc regus plc 
rethink group plc ricardo plc 
robert walters plc rps group plc 
rtc group plc saville group plc 
servoca plc staffline group plc 
t ribal group plc waterman group 
plc white young plc work group 
plc world careers network plc and 
ws atkins plc this list is reviewed 
annually
•
 the preferred eps growth 
measure is to be compound 
average growth rate ‘cagr’ 
as it rewards value creation 
equally over the period covered 
by the incentive preexceptional 
undiluted eps is to be used as 
the basis for awards so that any 
material abnormal influences 
are excluded and any abnormal 
influences which are not  
material but still significant are 
highlighted to the committee for 
consideration as to treatment
•
 both the tsr and eps measures 
being used for awards in 2011 are 
summarised below for the eps 
measure the committee takes 
into consideration both internal 
and external forecasts in setting 
targets as well as the guidelines 
of key investor bodies the tsr 
measure remains as previously 
approved by shareholders
employee benefit trusts and 
share plans generally
the group has a culture that 
encourages tax efficient share 
participation at all levels t wo 
employee benefit t rusts ‘ebt s’ 
which were funded by gifts from  
some of the current and former 
directors hold assets comprising 
shares in the company shares in 
the ebt s are mainly held for awards 
and grants under share option and  sthree plc 24
directors’ remuneration report
for the year ended 28 november 2010 continued
share award schemes introduced 
prior to flotation in which a number 
of employees still participate in 
2009 shareholders approved the 
introduction of a savingsrelated 
share option scheme ‘saye scheme’ 
and a savings  investment plan 
‘sip’ so that those uk employees 
who joined the group after 2004 
and who could not benefit from the 
earlier share schemes could then 
have access to such all employee 
schemes the company intends to 
make available similar arrangements 
in other jurisdictions subject to 
local laws etc where commercially 
justifiable and has set the critical 
mass of headcount for roll out in 
each country at 100 employees roll 
out will continue in 2011 for those 
countries which have already met 
this criteria with new countries to be 
progressively added each year in line 
with the agreed headcount threshold 
in normal circumstances
in respect of those share plans and 
related t rusts introduced prior to 
flotation these comprise an executive 
share option scheme the forfeitable 
share plan the share gift plan and 
the no1 esop and no2 esop  in 
respect of the no2 esop  this had 
adopted a t rust option plan and had 
agreed to satisfy the majority of 
options granted under the executive 
share option scheme and all awards 
under the forfeitable share plan with 
shares existing in the t rust under the 
terms of the t rust deed constituting 
the no2 esop  the t rustees have 
undertaken to waive all dividend 
rights on ordinary shares comprised in 
the trust fund the executive directors 
do not currently participate in any of 
these arrangements
generally in the event of a takeover or 
similar under the group’s share plans 
shares may generally be released 
or options exercised early with the 
committee normally taking into 
account the length of time between 
the start of any holding period and 
the triggering event as well as the 
level of any performance criteria up to 
the date of the triggering event the 
committee may also alter the rules 
of any share plan provided that this is 
not to the advantage of participants 
in which case prior approval of the 
company in general meeting must be 
obtained whilst any amendment that 
is to the disadvantage of participants 
requires the consent of a majority 
of them under the sip  shares are 
purchased on a monthly basis at 
the then market price and matching 
shares are awarded on a 11 basis 
provided that participants do not 
sell their purchased shares and also 
remain in employment within the 
group for at least one year
in terms of dilution the committee 
intends that awards under the l tip  
ebt s and other share plans should be 
satisfied by a combination of existing 
ebt shares market purchases and 
new issue shares where new issue 
shares are used this will be done 
in accordance with the guidelines 
provided by the association of british 
insurers expected value calculations 
of share incentives are not disclosed 
as these are not considered 
meaningful
executive directors’ service 
contracts
it is the company’s policy that 
executive directors should have 
contracts with a rolling term providing 
for a maximum of 12 months’ notice 
consequently in the event of an early 
termination the contractual right is to 
12 months’ basic salary and benefits 
with mitigation being generally 
required to reduce any compensation 
payable to a departing director
the executive directors were employed 
on service contracts with the group 
which commenced on 11 november 
2005 both russell clements and sunil 
wickremeratne 14 april 2008 gary 
elden and 7 may 2008 alex smith 
each of these contracts provides 
an entitlement to a basic annual 
salary performance bonus scheme 
participation a company car allowance 
pension contributions as well as health 
insurance cover and is terminable by 12 
months’ notice given by either party
nonexecutive directors
all nonexecutive directors have 
specific letters of appointment 
available upon request and their 
remuneration is determined by the 
board within the limits set by the 
articles of association and normally 
based on independent surveys of fees 
paid to nonexecutive directors of 
similar companies remuneration is 
set taking account of the commitment 
and responsibilities of the relevant 
role the nonexecutive directors 
do not have service contracts in 
2009 the committee undertook a 
benchmarking review of fees payable 
to the chairman and nonexecutive 
directors with the support of deloitte 
and the resulting proposal that there 
should be no fee increase was agreed 
with the board
clay brendish has a letter of 
appointment dated 1 may 2010 with 
his current annual fee being £125000 
whilst alicja lesniak t ony ward paul 
bowtell and nadhim zahawi were 
appointed nonexecutive directors 
on 3 may 2006 14 august 2006 
5 november 2007 and 1 may 2008 
respectively and receive annual fees 
of £35000 each
clay brendish is chairman of the 
nomination committee but receives 
no additional fee paul bowtell is 
chairman of the audit committee 
for which he receives an additional 
fee of £5000 pa whilst t ony ward  sthree plc 25
directors’ remuneration report
for the year ended 28 november 2010 continued
total shareholder return ‘tsr’
the graph below shows the t otal shareholder return ‘tsr’ of the company since flotation on 16 november 2005 for the 
group and the ftse support services index which is considered the most illustrative comparator index for investors as the 
company is a constituent of this index and its constituents are also used for comparing pay and benefit levels
also receives an additional fee 
of £5000 pa as chairman of the 
remuneration committee non
executive directors are appointed 
for an initial term of three years 
terminable by either the company 
or the nonexecutive director at will 
and in normal circumstances subject 
to performance and reelection at 
annual general meetings they would 
be expected to serve for a second 
threeyear term nonexecutive 
directors may be requested to serve 
for a further third threeyear term 
subject to rigorous review at the 
relevant time and their agreement 
upon termination or resignation non
executive directors are not entitled to 
compensation and no fee is payable in 
respect of the unexpired portion of the 
term of appointment nonexecutive 
directors cannot participate in any 
company incentive scheme
50
0
100
150
200
250
300
ftse all share support services sthree
16nov 05 16nov 06 16may 07 16nov 07 16may 08 16nov 08 16may 06 16may 09 16nov 09 16may 10 16nov 10
t otal shareholder returns rebased to 100
source datastream sthree plc 26
directors’ remuneration report
for the year ended 28 november 2010 continued
audited information
directors’ remuneration
the table below summarises all directors’ emoluments and pension contributions for the current and the prior year for 
comparison no other awards were made to any director during the year to 28 november 2010
       2010 2009
   salary pension    
name of director  and fees contributions benefits bonuses total total 
  £’000 £’000 £’000 £’000 £’000 £’000
executive directors
russell clements  3170 317 105 3590 7182 5177
gary elden   2415 242 105 2735 5497 3891
alex smith   2354 235 105 2666 5360 3871
sunil wickremeratne retired on 30 november 2010 2665 267 105 3018 6055 4369
nonexecutive directors
clay brendish appointed on 1 may 2010  729 – – – 729 –
paul bowtell   40 – – – 40 40
alicja lesniak  35 – – – 35 35
t ony ward   40 – – – 40 40
nadhim zahawi  35 – – – 35 35
sir anthony cleaver retired on 23 april 2010  416 – – – 416 100
aggregate emoluments  13249 1061 420 12009 26739 19808
benefits in kind may include a company car medical and life insurance but are not included above unless paid as a 
cash allowance gary elden received a reduction in salary between 1 march and 30 september 2009 due to him taking a 
pension salary sacrifice
as mentioned earlier sunil wickremeratne gave notice of his intention to retire as a director of the company in may 2010 
and retired on 30 november 2010 by mutual agreement he worked six months’ notice and in line with his contractual 
entitlement he will receive a payment in lieu of base salary for a further six months together with a payment in lieu of 
normal benefits for the six months outstanding notice period he will receive his bonus for the year ended 28 november 
2010 subject to the committee’s approval in early 2011 he is also receiving the sum of £102000 in consideration for 
covenants provided to the company and in lieu of his bonus for 2011 on a pro rata basis
in addition sunil will receive a payment of £5000 per annum under the terms of a separate arrangement similar to that 
which exists for william bottriell a former director who resigned in 2005 and who receive £5000 per annum for services 
provided from time to time
u10224pp2128indd   26 2211   142953 sthree plc 27
long term incentive plan minority stakes and other share options or awards
ltip
the committee has made the following awards to executive directors of forfeitable and deferred shares and options under 
the l tip  with awards being subject to the company’s tsr performance relative to peer group as well as eps as detailed 
above the next awards are to be made in february 2011
      shares 
ltip – date of marketoption price  shares shares vesting outstanding as 
name of director grantaward at grantaward awarded lapsed date at 28 nov 2010
russell clements 622008 19675p 175959 – 622011 175959
russell clements 322009 15450p 246213 – 222012 246213
russell clements 1122010 29940p 158817 – 1022013 158817
gary elden 622008 19675p 108476 – 622011 108476
gary elden 322009 15450p 187572 – 222012 187572
gary elden 1122010 29940p 120991 – 1022013 120991
alex smith 852008 1835p 143869 – 852011 143869
alex smith 322009 15450p 182834 – 222012 182834
alex smith 1122010 29940p 117935 – 1022013 117935
sunil wickremeratne 622008 19675p 147903 12325 622011 135578
sunil wickremeratne 322009 15450p 206990 86246 222012 120744
sunil wickremeratne 1122010 29940p 133517 100138 1022013 33379
after performance testing of the l tip awards granted in february 2007 44 of the awards vested with the remainder of 
the awards lapsing in accordance with the l tip rules
under the l tip rules the awards of sunil wickremeratne were time apportioned at the date of leaving therefore a number 
of shares lapsed as detailed above
in february 2010 awards for all l tip participants were structured to include tax approved options with funding awards also 
being granted at an option price of £1 in respect of the total award
on 19 october 2010 the company introduced a joint ownership plan ‘jop’ in respect of the unapproved l tip awards made 
in february 2010 jop options over existing l tip awards were granted to participants at 60p per share and apply to all of the 
directors prior to the introduction of the jop the committee conducted modelling to ensure that there was no potentially 
significant cost to either the company or participants
save as you earn ‘saye’
the following saye awards are held each being exercisable three years from the date of grant for a period of six months 
at the option price
      shares 
saye – date of option price  shares shares vesting outstanding as 
name of director grantaward at grantaward awarded lapsed date at 28 nov 2010
russell clements 2662009 15840p 5729 – 01112012 5729
gary elden 2662009 15840p 5729 – 01112012 5729
alex smith 2662009 15840p 5729 – 01112012 5729
sunil wickremeratne 2662009 15840p 5729 3010 01112012 2719
under the saye rules the shares of sunil wickremeratne were time apportioned at the date of leaving therefore some 
awards lapsed as stated above
gary elden also holds small percentage shareholdings in a number of sthree businesses under the group’s tracker 
share minority stake arrangements the earliest of these was created in november 2006 and in some cases loans were 
provided by the group to enable all senior individuals to acquire their shares in gary elden’s case loans totalling £305216 
were granted under normal commercial terms on 30 november 2006 and 6 february 2007 all loans outstanding are 
directors’ remuneration report
for the year ended 28 november 2010 continued sthree plc 28
expected to be repaid in full and details of the individual arrangements are also disclosed in the statutory accounts of 
the relevant businesses concerned as an executive director gary cannot participate in any minority stake arrangement 
approved by shareholders after his appointment to the board however at the agm in april 2009 shareholders ratified his 
participation in the 2008 arrangements as these were approved at the agm in april 2008 but not actually created until 
after his board appointment in july 2008
no other awards or share options are held by the executive directors
directors’ interests in shares
in accordance with the listing rules the directors’ interests in the share capital of the company at 28 november 2010 are 
shown below and there have been no changes to this information as at the date of this report no director had any other 
interest in the share capital of the company or its subsidiaries or exercised any share options during the year other than 
as already disclosed
 ordinary shares held at  ordinary shares held at percentage of 
name of director 30 nov 2009 changes in year  28 nov 2010 share capital
russell clements 4738549 975788 3762761 309
gary elden 3385018 1020 3386038 278
alex smith 398 1230 1628 below 01
sunil wickremeratne  
retired on 30 november 2010 10671373 20501 10691874 878
clay brendish appointed on 1 may 2010 – 13500 13500 001
paul bowtell 10000 – 10000 001
alicja lesniak 4245 – 4245 001
t ony ward 12063 – 12063 001
nadhim zahawi 14720 – 14720 001
sir anthony cleaver retired on 23 april 2010 152446 – 152446 013
interests in shares relate only to ordinary shares of 1 pence each but may include partnership and matching shares held 
in trust under the sip  which are subject to forfeiture conditions in certain circumstances sip participants may also 
reinvest dividends by way of a dividend reinvestment plan ‘drip’ and any shares resulting from the drip are included in 
the above totals
the company has in place formal shareholding guidelines for executive directors as such all executive directors 
must attain a level of shares equivalent to at least 100 base salary within five years of 1 december 2008 or their date 
of appointment although there is no formal shareholding requirement below executive director level most executive 
committee members already hold shareholdings well in excess of this level in line with the group’s culture of encouraging 
share participation at all levels in particular it is currently estimated that in total over 30 of the company’s share 
capital is held by directors founders the employee benefit t rusts senior management and other employees
on 26 november 2010 the last dealing day before the year end the closing market price of sthree plc ordinary shares 
was 2788p the highest and lowest closing prices of these shares during the year was 3805p and 2311p respectively 
based on the london stock exchange daily official list
approval
this report was approved by the committee on behalf of the board on the date shown below and signed on its behalf by
tony ward obe
chairman of the remuneration committee
28 january 2011
directors’ remuneration report
for the year ended 28 november 2010 continued sthree plc 29
the board believes that high 
standards of corporate governance are 
intrinsic to the company’s culture and 
values in particular
•  they are central to its core values 
and strategy including integrity 
professional excellence and 
sustainability as stated in this 
annual report
•  they underpin the objectivity 
of such processes as balance 
sheet and cash management 
risk management the design 
and operation of executive 
remuneration and succession 
planning
•  they are the basis for the 
accountability of executive 
management to the board and 
of the board to company’s 
shareholders
this report outlines how the company 
has complied with the main principles 
of the combined code on corporate 
governance revised by the financial 
reporting council in june 2008 ‘the 
combined code’the board considers 
that it complied with all key provisions 
of section 1 companies of the 
combined code
the board has also taken account of 
the uk corporate governance code 
published by the financial reporting 
council in may 2010 ‘the code’ 
although compliance with the code 
is not yet formally required the table 
below summarises how the company 
has applied the mainsupporting 
principles and provisions of the code 
since its publication
corporate governance report 
for the year ended 28 november 2010
relevant section of the code commentary including relevant code provision
a leadership
a1 the role of the board  the board provides entrepreneurial leadership and overall control of the group setting a 
framework of prudent and effective controls to enable risks to be properly assessed and 
managed its primary role is to create value for stakeholders to agree and approve the 
group’s longterm strategic objectives and to develop robust corporate governance and risk 
management practices whilst ensuring that the necessary financial and other resources 
are in place to enable those objectives to be met in undertaking this the board also reviews 
management performance and sets the company’s values and standards with all directors 
acting in what they consider to be the best interests of the company consistent with their 
statutory duties
  certain powers are delegated to the remuneration committee audit committee and 
nomination committees with details of the roles and responsibilities of these committees 
being set out under the relevant section below in addition the board has agreed t erms 
of reference for its other formal committees in order to facilitate more efficient working 
practices and these include the executive committee the investment committee a 
routine business committee a disclosure committee and csr committee to provide a 
clear framework of delegated and other authorities during 2010 all committees’ terms of 
reference were updated particularly in the light of the uk corporate governance code and 
icsa best practice guidelines
  a11 the board is responsible to shareholders for the proper management of the group and 
has identified key financial and operational areas that require regular reporting and which 
enable the performance of executive management to be reviewed and monitored these 
are set out in a schedule of matters reserved to the board which is reviewed and kept 
updated on a regular basis the schedule outlines all matters requiring specific consent of 
the board which include interalia the approval of group strategy and operating plans the 
annual budget the annual report the interim report and related announcements major 
divestments and capital expenditure large acquisitions and disposals the recommendation 
of dividends and the approval of treasury and risk management policies the schedule 
therefore facilitates structured delegation subject to certain financial limits and provides  sthree plc 30
corporate governance report  
for the year ended 28 november 2010 continued
a practical framework for executive managementreporting which seeks to achieve the 
objectives of maintaining effective financial and operational controls while providing 
sufficient flexibility to manage the business the current schedule of matters reserved to 
the board is available on the company’s website wwwsthreecom
  a12 the current directors of the company including biographies are shown within the 
section ‘board of directors and secretary’ as set out earlier in this annual report with 
further details of board committee membership being set out below the number of and 
attendance at board and committee meetings during the year is also shown in a table 
below almost all meetings were fully attended and outside these there was frequent 
contact between directors to discuss the company’s affairs and develop its business
  a13 appropriate insurance cover is in place in respect of legal action against the directors
a2 division of a21 there is a clear division of responsibilities between the chairman and the chief 
responsibilities  executive officer and they have been set out in writing and approved by the board so that no 
one individual has unfettered powers of decision
a3 the chairman  the chairman leads the board in the determination of its strategy and in the achievement 
of its objectives and is responsible for organising the business of the board ensuring its 
effectiveness timing and setting its agenda but has no involvement in the daytoday 
business of the group the chairman allows adequate debate by all whilst facilitating the 
effective contribution of the neds including board induction and evaluation ensuring 
constructive relations between executive and neds and that the directors receive accurate 
timely and clear information to facilitate effective communication with shareholders
  the chief executive officer has direct charge of the group on a daytoday basis and overall 
responsibility to the board for the financial and operational performance of the group under 
a job description which clearly sets out these responsibilities
  a31 as stated below the chairman met on appointment and continues to meet the 
independence criteria set out under the code
a4 non executive a41 t ony ward is appointed as the senior independent ned and is available to 
directors  shareholders to discuss strategy or governance issues or should there be matters of 
concern that have not or cannot be addressed through the normal channels
  a42 the chairman meets with the non executive directors ‘neds’ without the executive 
directors being present either before or after each board meeting and this is formally 
minuted whilst the senior independent non executive director ‘sid’ holds annual 
discussions with the other neds without the chairman being present and also with the 
executives in order to appraise the chairman’s performance
  a43 each director ensures that if heshe has any concerns which cannot be resolved 
about the company or a proposed action such concerns are recorded in the board minutes 
whilst upon resignation nonexecutives are invited to provide a written statement to the 
chairman for circulation to the board should they have any concerns sthree plc 31
corporate governance report  
for the year ended 28 november 2010 continued
b effectiveness
b1 composition of the board comprises a balance of executive and neds who bring a wide range of skills
the board  experience and knowledge to its deliberations the neds fulfil a vital role in corporate 
accountability and have a particular responsibility to ensure that the strategies proposed by 
the executive directors are fully discussed and critically examined not only in the best long
term interests of shareholders but also to take proper account of the interests of customers 
employees and other stakeholders the neds are all experienced and influential individuals 
and through their mix of skills and business experience they contribute significantly to 
the effective functioning of the board and its committees ensuring that matters are fully 
debated and that no one individual or small group dominates the decision making process
  directors have a wide range of experience of various industry sectors relevant to the group’s 
business and each member brings independent judgement to bear in the interests of the 
company on issues of strategy performance resources and standards of conduct the 
board is of sufficient size to match business requirements whilst accommodating any 
changes and members have an appropriate and varied range of skills vital to the success of 
the group
  the composition of the board and its various committees is reviewed and evaluated so as 
to reflect the board’s and the committees’ balance of skills expected time commitment 
knowledge and experience the directors’ aim is to ensure that the balance of the board 
and its committees reflects the changing needs of the group’s business and therefore 
composition balance and skills are all regularly monitored and refreshed as necessary
  b11 excluding the chairman the other neds have been determined by the board 
throughout the year as being independent in character and judgement with no relationships 
or circumstances which are likely to affect or could appear to affect the director’s 
judgement
  b12 the board comprises the non executive chairman who is not classed as independent 
because of his position but who met the independence criteria set out in the code on 
appointment three executive directors and four independent neds this is in compliance 
with the code which requires at least half of the board to consist of independent neds
b2 appointments appointments to the board are the responsibility of the full board upon the 
to the board  recommendation of the nomination committee and after appropriate external consultation 
bearing in mind the board’s existing balance of skills and experience the specific role 
needs identified and with due regard for diversity including gender succession planning 
aspects are regularly reviewed by the committee in order to ensure an orderly progression
refreshment of senior managementboard members and maintain an appropriate balance of 
skills experience and diversity both within the company and on the board
  b212 under the direction of the nomination committee each formal selection process 
is conducted using external advisors consisting of a series of interview stages involving 
directors and other senior executives each being set against a specific role definition and 
objective criteria details of the composition work and responsibilities of this committee are 
set out under the relevant section below
  b23 neds are appointed for specified three year terms with all directors being subject to 
annual reelection the company’s articles of association set out clear powers of removal 
appointment election and reelection of directors sthree plc 32
corporate governance report  
for the year ended 28 november 2010 continued
b3 commitment  b31 during 2009 when the nomination committee last initiated the search for a new 
director a detailed job specification was prepared setting out an assessment of the time 
commitment expected all potential director candidates are required to disclose any 
significant outside commitments prior to appointment and must undertake that they have 
sufficient time to meet these in addition to company business particularly in the event of a 
crisis
  b32 upon joining the board each ned receives a formal appointment letter which identifies 
their formal responsibilities and expected minimum time commitment being typically two 
days per month these letters are available for inspection at the company’s registered office
b4 development  at scheduled board and committee meetings directors receive detailed reports from 
executive management on the performance of the group with managers giving regular 
presentations on their areas of responsibility neds are invited to attend the group’s 
annual conference in order to join senior management from each geographic area to 
discuss current initiatives and board meetings are also scheduled at office locations 
spread throughout the globe in order to allow all directors to meet local managers and 
improve international understanding directors are provided with written materials on their 
responsibilities as directors of a public company and on other relevant regulatory legal 
governance and accounting matters regular updates are provided on a range of  
other relevant topics as required and directors are also encouraged to attend external 
seminars on areas of relevance to their role in order to facilitate their professional 
development
  these measures help to ensure that the directors continue to develop their knowledge of 
the group’s business and get to know its senior management as well as being aware of their 
general responsibilities in addition the board encourages executive directors to accept 
external appointments in order to broaden their experience although currently no such 
positions are held
  b41 an induction programme is available for new appointments and this is tailored to each 
individual to ensure that it is appropriate for their role and level of previous experience 
directors and other senior executives attend analysts’ briefing sessions and major 
shareholders may upon appropriate request meet new neds
  b42 as part of the annual board evaluation process the chairman assesses and agrees 
any training and development needs in respect of individual directors including on 
environmental social and governance ‘esg’ matters where appropriate following the 2010 
evaluation exercise specific training needs were identified for all executive directors
b5 information and board and committee meeting papers are circulated well in advance of the relevant 
support  meeting and where a director is unable to attend heshe is provided with a copy of the 
papers and has the opportunity to comment on the matters under discussion minutes 
of all committee meetings are circulated to all the directors irrespective of committee 
membership
  the group company secretary is responsible for ensuring good information flows between 
the boardcommittees and senior individualsneds as well as assisting in other areas 
and has primary responsibility for advising the board via the chairman on all governance 
matters sthree plc 33
corporate governance report  
for the year ended 28 november 2010 continued
  b51 directors are entitled to obtain independent professional advice at the company’s 
expense in the performance of their duties as directors and no such advice was sought 
during the year all committees are serviced by the group company secretary’s team and 
are appropriately resourced
  b52 directors have access to the advice and services of the group company secretary who 
is responsible to the board for ensuring that its procedures are complied with and to assist in 
arranging any additional information as required the appointment and removal of the group 
company secretary is a matter reserved for the board as a whole and the last appointment 
was made in october 2006
b6 evaluation  an annual performance evaluation process led by the chairman is in place to evaluate 
the board committees and individual directors questions are designed to ensure that 
the performance of each individual director and the functioning constitution and work 
of the board and each committee are properly assessed the chairman also discusses 
the individual performance of directors in consultation with other directors these 
assessments concluded that overall and individually the performance of the board each 
committee and each director was and is effective and that directors demonstrate full 
commitment in their respective roles
  b61 the evaluation process is considered to be both formal and rigorous and takes the 
form of a questionnaire completed by each director giving hisher assessment of both  
collective and individual performances with the results being reviewed and debated at 
both board and committee level as well as with the individual director concerned where 
appropriate as a result of the action points arising from the 2010 evaluation a number of 
improvements have been made in areas such as risk management information flows to 
the board length of meetings ned mentoring succession planning scope and executive 
development initiatives
  b62 the board will continue to develop its evaluation processes as necessary in order 
to take into account evolving best practice with regard to external facilitation although no 
external provider has yet been appointed
  b63 the sid holds annual discussions with the other neds without the chairman being 
present and also with the executives in order to appraise the chairman’s performance
b7 reelection  b71 the company’s articles of association state that a director appointed by the board 
shall hold office only until the next agm unless reelected during that meeting additionally 
each director must retire at the agm held in the third calendar year following the year in 
which heshe was elected or last reelected but shall be eligible for reelection however as 
recommended by the code all directors will retire and seek reelection at the agm annually
  b72 reference to performance and commitment of directors as well as an explanation of 
the reason why each retiring director should be reelected are all provided in the notice of 
annual general meeting ‘agm’ the company also complies fully with the code in respect of 
its agm voting arrangements and rns disclosure
c accountability
c1 financial and the chairman’s statement chief executive officer’s and chief financial officer’s reviews
business reporting  taken together with this directors’ report provide information relating to the group’s 
activities its business and strategy and principal risks and uncertainties faced by the  sthree plc 34
corporate governance report  
for the year ended 28 november 2010 continued
business including analysis using financial and other kpis where necessary these 
together with the directors’ remuneration report corporate governance and corporate 
social responsibility reports provide an overview of the group including environmental 
and employee matters and give an indication of future developments in the group’s 
business this provides a balanced and understandable assessment of the group’s position 
and prospects in accordance with the code
  c11 the directors’ responsibility for preparing the accounts and statement by the auditors 
about their reporting responsibilities are set out in the directors’ report and independent 
auditors’ report respectively
  c12 an explanation of the business model and the strategy for delivering the objectives of 
the group is included as part of the chief executive officer’s and chief financial officer’s 
reviews
  c13 a ‘going concern’ statement is included in the directors’ report
c2 risk management c21 the board’s statement regarding its review of the effectiveness of the group’s risk
and internal control management and internal control systems is set out below and this is reviewed annually
c3 audit committee  details of the composition work and responsibilities of this committee are set out under 
and auditors the relevant section below
d remuneration
d1 level and components  the directors’ remuneration report sets out in full the policies and practices which 
demonstrate the company’s implementation of this code principle and provisions
d2 procedure  details of the composition work and responsibilities of this committee are set out under the 
relevant section below and in the directors’ remuneration report
e relations with shareholders
e1 dialogue with communications with shareholders are given a high priority the company produces 
shareholders  annual and interim reports which are published for all shareholders and the company’s 
website contains uptodate information on the group’s activities investor presentations 
and published financial results shareholders can also subscribe for email alerts of 
important announcements made
  there is regular dialogue with institutional shareholders whilst ensuring that price sensitive 
information is released at the same time to all in accordance with the requirements of the 
uk listing authority presentations are made after the company has published its full and 
half year results and there is also dialogue on specific issues such as the appointment of a 
new chairman minority interests introduction of and changes to the long t erm incentive 
plan and on other key remuneration issues
  e11 the chairman senior independent and other neds are available to shareholders to 
discuss governance or strategy issues or should there be matters of concern that have 
not or cannot be addressed through the executive directors during the year both the 
chairman and sid conversed with shareholders with appropriate feedback being provided to 
the board at its next following meeting sthree plc 35
corporate governance report  
for the year ended 28 november 2010 continued
  e12 views of analysts brokers and institutional investors are sought on a nonattributed basis 
via periodic sentiment surveys and these as well as regular analyst and broker publications 
are circulated to all directors to ensure that all can develop an understanding of the views of 
major shareholders any issues or concerns are raised at the board and directors routinely 
receive regular reports on share price trading activity and sector updates
e2 constructive the board views the agm as a valuable opportunity to communicate with private and 
use of agm institutional investors and welcomes their participation
  e21 the company proposes a separate resolution on each substantially separate issue and 
the proxy appointment forms for each resolution provide shareholders with the option to 
direct their proxy to vote either for or against the resolution or to withhold their vote
  e22 the company’s registrars ensure that all valid proxy appointments received for the 
agm are properly recorded and counted and a schedule of proxy votes cast is made available 
to all shareholders attending the meeting there is full disclosure of the voting result via 
rns and on the company’s website as soon as practicable after the agm has concluded
  e23 all board members are encouraged to attend the agm and in particular the chairmen 
of the audit nomination and remuneration committees are available to answer questions
  e24 the notice of agm is posted at least twenty working days prior to the date of the 
meeting and the company’s website contains copies of all notices issued
board and committee composition and attendance in accordance with a12 of the code
as stated the board has established various committees each with clearly defined terms of reference procedures 
and powers during 2010 all committees’ terms of reference were updated particularly in the light of the uk corporate 
governance code and icsa best practice guidelines and all committees operate in accordance with the relevant terms of 
reference approved by the board with copies of these being available on request from the group company secretary or 
downloadable from wwwsthreecom
in addition to the scheduled board meetings held during the year the board met for an off site strategy session held over 
two days and for the agm the number of meetings held for the board and each respective committee and attendance 
thereat is as follows and includes the meetings held in early december 2010
directors possible attendance actual attendance
    remun nom   remun nom
  board audit eration ination board audit eration ination
clay brendish  6 na na 1 5 na na 1
russell clements  10 na na 2 9 na na 2
sunil wickremeratne  9 na na na 9 na na na
alex smith  10 na na na 10 na na na
gary elden  10 na na na 9 na na na
t ony ward  10 na 4 2 10 na 4 2
alicja lesniak  10 4 4 2 9 4 3 1
paul bowtell  10 4 na 2 8 4 na 1
nadhim zahawi  10 4 4 na 8 3 3 na
clay brendish was appointed as chairman on 1 may 2010 and due to prior commitments was unable to attend all 
meetings the other directors were unable to attend due to other business or parliamentary commitments although full 
board packs were despatched and separate discussions held on relevant points of interest in all cases sthree plc 36
corporate governance report  
for the year ended 28 november 2010 continued
audit committee in 
accordance with c31 to c37 
of the code
the audit committee consists of 
paul bowtell chairman alicja 
lesniak and nadhim zahawi and 
accordingly comprises at least three 
independent neds as required by the 
code the chief executive officer 
the chief financial officer the group 
company secretary and the external 
auditors attend all meetings at the 
request of the committee paul 
bowtell is a chartered accountant 
and is considered by the board to 
have recent and relevant financial 
experience given his recent role 
as chief financial officer of tui 
t ravel plc
the committee’s principal 
responsibilities are set out in its terms 
of reference and broadly are to 
monitor the integrity of the financial 
statements of the company and any 
formal announcements relating to 
the company’s financial performance 
reviewing any significant financial 
reporting issues and judgements 
contained within them to review the 
company’s internal financial controls 
internal control and risk management 
systems and reporting thereon 
including advising on risk appetite 
tolerance and strategy as well as risk 
exposures and assessment advising 
on proposed strategic transactions 
including conducting due diligence 
appraisals and focussing on 
risk aspects assessing material 
breaches of risk limits advising on 
risk performance and remuneration 
aspects reviewing arrangements by 
which group employees may raise 
concerns about possible improprieties 
in financial reporting or other such 
matters and ensuring appropriate 
follow up assessing procedures for 
detecting fraud or preventing bribery 
overseeing the remit of the risk 
management function to monitor 
and review the effectiveness of the 
company’s internal audit function to 
make recommendations to the board 
for it to put to the shareholders for 
their approval in general meeting 
in relation to the appointment 
reappointment and removal of the 
external auditor and to approve 
the remuneration and terms of 
engagement of the external auditor 
to annually review and monitor the 
external auditor’s independence and 
objectivity and the effectiveness 
of the audit process taking into 
consideration relevant uk professional 
and regulatory requirements to 
develop and implement policy on the 
engagement of the external auditor 
to supply nonaudit services taking 
into account relevant ethical and 
professional guidance regarding the 
provision of nonaudit services by 
the external audit firm reporting to 
the board identifying any matters 
in respect of which it considers that 
action or improvement is needed and 
making recommendations as to the 
steps to be taken and generally to 
identify and report on any business 
areas where action or improvement 
are needed and recommend actions 
to be taken
the committee considers 
matters relating to the 
recommendation for appointment 
reappointment remuneration 
and terms of engagement of 
the company’s external auditor 
pricewaterhousecoopers llp ’pwc’ 
both the committee and the external 
auditors themselves have safeguards 
in place to ensure that objectivity 
and independence is maintained 
including the periodic rotation of the 
audit partner in addition to the annual 
appointment of the external auditors 
by the shareholders the committee 
regularly reviews their independence 
taking into consideration relevant 
uk professional and regulatory 
requirements the committee 
reviews performance and fees 
charged including compensation 
structure and meets with the external 
auditor at least once a year without 
management present
the committee considers that the 
relationship with the external auditors 
is working well and remains satisfied 
with their effectiveness accordingly 
to date it has not considered it 
necessary to require pwc to retender 
for the audit work the external 
auditors are required to rotate audit 
partners responsible for the group 
audit every five years and the 
current lead audit partner has been 
in place for two years there are no 
contractual obligations restricting the 
group’s choice of external auditor
in 2009 the committee reviewed its 
policy on non audit work which may 
be undertaken by the external auditor 
and closely monitors such work this 
policy provides that nonaudit work 
may be carried out by the external 
auditor only where that work does not 
impair independence or objectivity 
and where the committee believes 
that it is in the group’s best interests 
to make use of the external auditor’s 
knowledge of the business skills and 
experience such work has included 
detailed local statutory audits or other 
services required due to legislation 
as well as assurance work and other 
specialist services where no internal 
resource is currently available the 
committee continuously monitors 
the quality and volume of this work 
the level of fees incurred as well 
as safeguards in order to assess 
whether to use other accounting 
firms or appropriately qualified 
organisations and as a consequence 
has now appointed bdo llp to 
provide general tax advice
in accordance with apb ethical 
standards and frc guidance this 
policy clearly specifies i which 
types of non audit work are excluded  sthree plc 37
corporate governance report  
for the year ended 28 november 2010 continued
for example bookkeeping design 
implementation and operation of 
systems actuarial and internal 
auditcontrol functions executive 
management functions and legal or 
other financial services ii the types 
of work for which external auditors 
can be engaged without referral to the 
committee ie provided such services 
are specifically listed within the policy 
and fall below £50000 and iii for 
which types of work a referral to the 
committee is necessary ie non listed 
services or those listed within the 
policy which are above £50000
details of fees paid to the external 
auditors for both audit and non audit 
work are given in the notes to the 
financial statements the committee 
has fully evaluated this work against 
its formal policy and remains 
comfortable that it is appropriate and 
the fees justified although the level 
of non audit fees paid out in 2010 is 
higher than the level of audit fees paid 
out much of this work is in relation to 
key projects including in particular 
the group’s corporate simplification 
project as well as for general tax 
advice the level of non audit fees 
is expected to reduce significantly 
in 2011 given the significant 
streamlining of the group’s structure 
which was achieved predominantly 
in 2010 as well as the appointment 
of bdo llp to provide tax advice as 
mentioned above
following its creation the group has 
continued to expand its internal audit 
function which is now at full strength 
the committee believes that this 
function remains effective and adds 
significant value
the group also has in place a 
dedicated independent whistle 
blowing hotline as part of the 
arrangements set up and monitored 
by the committee so that employees 
are able to report any matters 
of concern where this does not 
conflict with local laws or customs 
more information is given within 
the corporate social responsibility 
section
nomination committee in 
accordance with b21 b22 
and b24 of the code
the nomination committee consists 
of clay brendish chairman t ony 
ward alicja lesniak and paul bowtell 
and accordingly comprises a majority 
of independent neds as required by 
the code
the nomination committee’s 
terms of reference are broadly 
to regularly review the structure 
size and composition including the 
skills knowledge and experience 
and diversity of the board make 
recommendations with regard to 
any changes and to review and 
prepare relevant job descriptions 
for new appointees the committee 
also considers future succession 
planning for board and other senior 
executive roles reviewing leadership 
and other role needs bearing in mind 
the balance of skills knowledge 
experience and diversity already 
on the board so as to maintain an 
appropriate balance the committee 
engages external search consultants 
with respect to both executive and 
nonexecutive board appointments 
and considers applicants from all 
backgrounds as was the case for 
the most recent appointment being 
clay brendish in this and in other 
cases the committee first conducted 
an evaluation of the balance of 
skills knowledge and experience on 
the board and in the light of this 
prepared an appropriate description of 
the role and capabilities required for 
the particular appointment with the 
successful appointee being selected 
from candidates proposed by external 
advisors and chosen entirely on merit
in terms of succession planning 
the group has continued its ‘t op 
60’ leadership initiative bringing 
together key managers from around 
the globe at regular sessions in order 
to identify and develop the most 
talented individuals for executive 
positions as part of this initiative 
egon zehnder international undertook 
detailed evaluations of senior key 
individuals below board level with 
outputs being discussed by the 
committee which closely monitors 
these activities to ensure that they are 
continually aligned with the group’s 
strategy non executives are also 
to be involved in the mentoring of 
selected key individuals from time to 
time as agreed with the committee 
and initiatives such as ‘women in 
management’ have been instigated 
during the year to promote diversity
remuneration committee in 
accordance with d21 and d22 
of the code
the remuneration committee 
is responsible for making 
recommendations to the board on 
group policy for the remuneration of 
the chairman the executive directors 
the group company secretary and 
certain key senior management 
posts and for the determination 
within agreed terms of reference of 
additional benefits for each of the 
executive directors including pension 
rights and any compensation for 
loss of office the committee is also 
responsible for the implementation  sthree plc 38
and operation of employee share 
incentive arrangements the 
committee comprises a majority of 
independent neds as required by 
the code full information on the 
composition role and operation of 
the remuneration committee and 
directors’ remuneration is detailed in 
the directors’ remuneration report
effectiveness of the company’s 
risk management and internal 
control systems in accordance 
with c21 of the code
the board has overall responsibility 
for monitoring the effectiveness of 
the company’s risk management and 
internal control systems in order to 
safeguard shareholders’ investments 
and the group’s assets executive 
directors and senior management are 
responsible for the implementation 
and maintenance of the systems 
which are subject to periodic and at 
least annual review by the board 
via the audit committee where 
appropriate as explained above in 
response to business requirements 
the group also created an internal 
audit function in 2008 in order to 
facilitate this process
the board via the audit committee 
monitors the continuous process by 
which critical risks to the business 
are identified evaluated and managed 
and this process explicitly includes 
the risks and opportunities to enhance 
value arising from esg matters 
the process is consistent with the 
t urnbull guidance on internal control 
and has been in operation for the 
period under review and up to the date 
of approval of this annual report
the board assesses the company’s 
risk management and internal control 
systems including material controls 
such as financial operational and 
compliance controls and enterprise 
risk management ‘erm’ systems 
these are designed to manage rather 
than eliminate the risk of failure 
to achieve the group’s objectives 
and can only provide reasonable 
not absolute assurance against 
material misstatement or loss the 
board considers in assessing what 
constitutes reasonable accuracy 
the materiality of financial and non
financial risks and the relationship 
between the cost or benefit resulting 
from the risk management or internal 
control systems
the board regularly reviews the 
actual results compared with the 
budgeted and forecast performance 
of the group as well as other key 
performance indicators which are 
detailed within the directors’ report
during 2010 the group continued 
to rationalise its brands in order 
to implement a ‘country director’ 
structure under regional mds and 
lines of responsibility and delegated 
authorities were reviewed with 
policies and procedures updated and 
communicated accordingly
assessment of risk and 
enterprise risk management 
‘erm’ framework
the board through the audit 
committee has overall responsibility 
for risk management activities and 
implementing policies to ensure that 
all risks are evaluated measured 
and kept under review by way of 
appropriate kpis and this forms the 
basis for the group’s erm framework 
under this framework all executive 
regional and country directors key 
support functions and other relevant 
parties take ownership of their related 
risks creating specific subgroup 
risk registers with risks being 
categorised according to probability 
and financial impact and measured 
according to strictly defined criteria 
as set out under the board approved 
risk management policy more 
significant risks are distilled to form 
the group’s key risk register which is 
closely monitored by the committee 
and risks include amongst others 
those relevant to the processes for 
financial reporting and the preparation 
of consolidated accounts with 
appropriate mitigation measures
following the ‘gap analysis’ 
undertaken by external erm 
specialists in 2009 during 2010 
the group continued to roll out its 
erm framework throughout the 
business and has consequently 
further developed and enhanced its 
risk evaluation and erm reporting 
mechanism including holding a 
further strategic risk workshop 
involving executive directors 
regional mds country directors and 
key function heads as a result the 
following steps were taken during  
the year
•
  country directors now own 
localised risk registers with 
regular presentations being made 
to the board to include progress 
on risk mitigation with underlying 
reviews of risksintegrity also now 
undertaken regularly
•
  audit committee meetings 
include regular presentations by 
mdscountry directors etc on 
their approach to business risk 
management and tracking of 
improvement areas
•
  annual ‘risk focussed’ leadership 
workshop scheduled with erm 
specialists in attendance
corporate governance report  
for the year ended 28 november 2010 continued sthree plc 39
•
  a formal risk management policy 
and procedure document have 
been approved by the board and 
communicated groupwide
•
  group risk appetite has now been 
fully defined and formalised with 
group and localised measures 
being rolled out to mdscountry 
directors via appropriate kpis 
some being detailed within 
the directors’ report with 
remuneration also being subject to 
measurement against managing 
business risk
•
  remaining key executive job 
descriptions have been redrafted 
to include reference to their risk 
responsibility
the group’s erm arrangements have 
been designed to meet as closely as 
possible the appropriate bsi standard 
bs 3100 on risk management 
processes consequently the group 
has continued to reap the benefits 
of its enhanced erm framework 
through improved strategic and 
individual regionsector focus on 
key risk areas with greater clarity 
on risk ownership identification of 
opportunities as well as threats whilst 
also facilitating better monitoring 
of progress mitigation measures 
and ensuring appropriate forward 
looking assessment including where 
relevant reference to esg matters
association of british insurers 
‘abi’ guidelines on responsible 
investment disclosures
in respect of the company’s 
compliance with the abi guidelines on 
responsible investment disclosures 
the board confirms the following in 
relation to its responsibilities policies 
and procedures with appropriate kpis 
detailed within the directors’ report
•
  as part of its erm procedures 
the board takes account of the 
significance of esg matters to 
the business of the company 
adherence to these procedures 
and disclosure of relevant issues 
is monitored by the internal audit 
function and also reviewed by 
external erm specialists as part of 
the overall erm framework
•
  the board has reviewed but has 
not identified any significant esg 
risks to the company’s short and 
longterm value or opportunities to 
enhance value
•
  the board has received adequate 
information to make this 
assessment by way of its erm 
procedures and where necessary 
has taken account of esg matters 
in the training of directors as well 
as ensuring inclusion in bonus 
structures
•
  the board has ensured that the 
company has in place effective 
systems for managing and 
mitigating significant risks 
where relevant these incorporate 
performance management 
systems and appropriate 
remuneration incentives
•
  there are no esgrelated risks 
and opportunities that may 
significantly affect the company’s 
short and long term value or the 
future of the business
going concern
the board has reviewed the group’s 
budget for the financial year ending 
27 november 2011 and medium term 
financial projections for the next three 
years after taking account of the cash 
flow projections including proposed 
capital expenditure and considering 
the availability of borrowing facilities 
the board has concluded that it is 
appropriate to prepare the accounts of 
both the group and the company on 
the going concern basis
corporate social and 
environmental responsibility
the board recognises that the group 
has a responsibility to act ethically 
in relation to the physical and social 
environment in which it operates and 
that failure to do so could adversely 
impact on the group’s long and short
term value as a result of financial 
penalty and loss of customer support 
it takes such responsibilities seriously 
paying due regard to international and 
local laws in all its dealings further 
details are disclosed in the corporate 
social responsibility report
share capital
information on the company’s share 
capital is set out within the directors’ 
report
steve hornbuckle
group company secretary 
28 january 2011
corporate governance report  
for the year ended 28 november 2010 continued sthree plc 40
corporate social 
responsibility report
for the year ended 28 november 2010
introduction
we believe that proper understanding 
and management of our social and 
environmental impacts are important to 
the continued success of our business 
as we focus on long term success our 
csr strategy called giving something 
back concentrates on tackling issues 
that will have a sustained effect on our 
local and international communities 
our environment our people – and 
ultimately our business
we strive to be the best company 
to work for and we cannot achieve 
this without being a socially and 
environmentally responsible business 
our global success will be increasingly 
reliant on the breadth and effectiveness 
of our csr programme and we now 
have a solid base linking people 
committees and policies to make this 
programme an integral part of how we 
run our business
principles
in 2007 we defined our corporate social 
responsibility ambitions that underpin 
everything we do as follows
•  give those in the community that 
most need it opportunity and 
aspiration
•  respect the environment we live 
in
•  give back to the people who 
work so hard to make this a great 
company
what happened in 2010
giving something back concentrates 
on three areas community 
environment and workplace the 
following details progress made against 
our csr strategic objectives in 2010
community 
we want to give those that most need 
it opportunity and aspiration – this 
applies to the communities in which we 
work and beyond we have a wealth of 
talent and energy at sthree that can 
be harnessed to benefit communities 
local to our offices and we will 
continue to partner with charities and 
community groups to facilitate this 
fulfilling our community commitments 
influences the way we do business 
and we hope they will contribute to our 
continued success our volunteering 
and fundraising policy underpins 
all the work we do for communities 
and enabled us to clearly state to 
employees how they can get involved 
with our community work
activities that took place in 2010 
include
volunteering
our main focus for any work we do 
in the community is young people 
especially those classified as neet 
– not in education employment or 
t raining t o that end we worked hard 
with time  t alents to find ways of 
providing support to young people to 
help them find jobs
we continue to work closely with time 
 t alents westminster a not for profit 
partnership enabling private public and 
voluntary sector organisations to work 
together to deliver effective employer 
supported volunteering esv our 
membership of this organisation 
gives us access to charities that are 
interested in employers providing 
skilled volunteers that would take a lot 
of effort and time to achieve ourselves
our itjobboard team worked with 
‘whizzkids’ on their high profile blue 
peter campaign the marketing team 
developed a marketing strategy for the 
campaign and have subsequently been 
involved in the roll out of it
we engaged with the cardinal hume 
centre in westminster to develop a soft 
skills workshop for clients of the centre 
that may be longterm unemployed 
or have never been employed the 
cardinal hume centre works with 
homeless young people refugees 
asylum seekers and migrants by 
helping them find employment and 
break the cycle of homelessness and 
exclusion we helped them to learn 
and develop key communication skills 
and to develop their presence which 
will help them in future interviews and 
allow them to feel more positive
2010 also saw us working with the 
paddington academy a nonselective 
school in west london for 11 to 18 year 
olds and offering our employees the 
chance to volunteer at the academy 
we have agreed a series of activities 
the first being a teacher mentoring 
scheme for our senior managers
whilst our policy developed in 2009 
outlines how employees can get 
involved in volunteering supported 
by us or arranged by the individual 
we now have online application 
forms and an approval process that 
ensures everyone can benefit from the 
experience each permanent employee 
at sthree is entitled to two volunteer 
days per year that can be used to 
attend a volunteering activity
as a corporate partner of time  
t alents westminster we meet regularly 
with other corporate community 
and third sector partners to share 
our collective experiences and work 
together to build a strong network 
that will benefit each partner and 
their stakeholders we hosted an 
employability working group in spring 
2010 with the objective of setting the 
agenda for any volunteering done in 
this area within westminster
finally 2010 also saw us partner with 
the university of birmingham through 
the funding of two scholarships 
focussed on raising the aspirations of 
talented students the funding will help 
students from a background without  sthree plc 41
corporate social 
responsibility report   continued
for the year ended 28 november 2010
experience of higher education or 
where parents are not in professional 
occupations to experience university 
life while rewarding them for 
achieving excellent academic 
standards
fundraising
raising funds for charitable causes has 
always been important at sthree and 
we continued to fundraise for some 
great charities in 2010 our current 
charity partner sos children’s villages 
has benefited from major fundraising 
events – dress down days and a 
prize draw at our annual battersea 
christmas party sos children provide 
homes for orphans and abandoned 
children worldwide and were chosen at 
the end of 2008 because of their young 
person focus and international scope 
as a growing international company 
we wanted to have a charity partner 
that represented our network of offices 
around the world
we are very pleased to have raised 
nearly £100000 for sos children this 
year when matched funding is taken 
into account
in support of sos children’s villages 
60th anniversary celebrations we 
sponsored the purchase of “flip” 
cameras in support of their “our africa” 
project
we are very proud of this and are 
looking forward to raising more in 2011 
with our future focus being to enable 
employees in each region to choose a 
local charity to fundraise for and to have 
an international network of community 
champions throughout the group to 
engage employees and ensure that we 
maximise impact in this area
  
environment 
with 1800 employees spread 
across the globe managing our 
environmental impact is a challenge 
and one that we are fully committed 
to we have started to measure and 
reduce our carbon footprint throughout 
our uk operations and implemented 
individual carbon reduction plans 
for each uk office during 2010 by 
introducing technology to allow us 
to hold meetings and conferences 
via video links and the web we will 
continue to reduce the amount we 
travel and lessen our contribution to 
worldwide co2 emissions
t o measure and manage our carbon 
emissions in the uk we continue to 
work with the energy consultancy 
adian consulting this will change the 
way we manage energy at sthree and 
will lay the foundations for becoming 
an energy efficient company in 
the future our carbon footprint is 
disclosed below
currently less than 20 of ftse 
companies publish this figure although 
this will undoubtedly increase with 
the introduction of the uk carbon 
reduction commitment energy 
efficiency scheme crc although 
we fall outside the requirements of 
crc due to the amount of electricity 
we use we are pleased to say that we 
were compliant with the scheme when 
it was first introduced in april 2010
carbon footprint and energy 
management
in late 2008 a strategic decision 
was made to conduct a company
wide initiative to establish our 
carbon footprint and reduce energy 
consumption whilst also taking steps 
to increase recycling by 50 adian 
consulting were engaged to manage 
and deliver the project using a phased 
approach
phase one looked into data availability 
in relation to carbon emissions 
associated with office energy 
efficiency business travel and our 
company car fleet in addition waste 
management and utilities cost 
management were singled out for 
future consideration and action phase 
t wo verified preliminary findings and 
identified opportunities for change 
adian consulting visited and surveyed 
nineteen sthree offices in the uk 
and inspected landlords’ plant rooms 
service equipment and installations 
sthree employees taking part in the dusseldorf run4ideas sthree plc 42
corporate social 
responsibility report   continued
for the year ended 28 november 2010
the end goal of both phases was a 
carbon footprint figure for our business 
in the uk with the findings as follows
•  the company’s uk carbon 
footprint was estimated at 2423 
tonnes for the year 20089
•  85 2054 tonnes was due to 
building related energy usage
•  15 369 tonnes was due to 
business travel excluding car 
journeys
phase three of our carbon emissions 
project ran throughout most of 2010 
and saw the implementation of 
several energy saving and energy 
management initiatives across uk 
offices the project will also see us 
implement systems and processes to 
enable the inhouse measurement of 
our carbon footprint in future years 
as we make efforts to reduce our 
carbon emissions as a group we are 
committed to offsetting our footprint 
every year by investing in carbon 
reduction projects across the globe
as we open more and more offices 
globally we will look to decrease the 
environmental impact of each new 
office and will provide guidance to 
employees on how they can take 
personal ownership of environmental 
issues while at work
offsetting
as a result of the carbon footprint 
project we have started to implement 
ways of managing our energy and 
reducing our carbon emissions in the 
future t o add to our commitment to 
respecting the environment we will 
invest in carbon reduction projects 
through climatecare to offset our 
annual carbon footprint this means 
that we will have invested around 
£22000 in projects in 2010
we have taken a number of steps to 
reduce the amount of business travel 
our employees make over the last 
two years although we are conscious 
that this area still represents over 
10 of our carbon footprint figure t o 
minimise the impact of this travel on 
the environment we will be offsetting 
all incentiverelated travel through 
climatecare
workplace values  ethics
we want our people to thrive in 
the workplace and consider it our 
responsibility to provide an engaging 
supportive and safe environment that 
encourages them to make the best 
use of their talents and personalities 
we welcome anyone with the skills 
and abilities to succeed and are 
committed to offering our employees a 
balance of professional development 
benefits and rewards by not putting 
any restrictions on the type of people 
we recruit and by treating everyone 
equally we have established a truly 
diverse workforce we regularly  
review our working practices to  
ensure that they meet the needs of 
our employees and the cultures we 
operate in
understanding our employees and 
having highly engaged individuals 
who want to be part of our future is 
critical to achieving our goals t o this 
end september 2010 saw the launch 
of the sthree rapport survey our first 
employee engagement survey the 
survey objectives were to understand 
employee perceptions about working 
for sthree identify levels of employee 
engagement highlight areas for 
improvement in order to inform action 
planning and to use the survey data to 
drive change in the business in total 
82 of our people participated an 
excellent response rate
the survey focused on 14 dimensions 
including external customer focus 
leadership culture performance 
management reward and recognition 
and employee engagement managers 
across the group have shared the 
results with their teams and action 
plans have been created with the next 
survey scheduled for september 2011
previously being awarded diversity 
accreditation was an important step for 
the group and we want to build on that 
success in 2011 we will be piloting a 
‘woman in management’ programme 
with the aim of increasing the number 
of female employees moving into 
management roles and the number 
of female managers being promoted 
to senior roles focus will also be on 
the implementation of a consistent 
method of measuring and monitoring 
our diversity footprint
we will continue the roll out of the 
health and safety project established 
in the uk in 2009 to all international 
offices as well as further developing 
our online learning portal to deliver 
worldwide training programmes
this year the group redefined its 
ambition and rolled out a ‘values’ 
programme designed to achieve it 
the programme will systematically 
embed the values into every aspect 
of the business and successful 
implementation of these values will 
help the group attract and retain high 
quality candidates whilst driving high 
performance across both sales and 
support staff
the group’s ‘ambition’ ‘single 
organising thought’ and ‘values’ are 
listed below
ambition our ambition is to be the 
most respected and highly valued 
international specialised staffing 
services business
single organising thought 
recognising and developing talent sthree plc 43
corporate social 
responsibility report   continued
for the year ended 28 november 2010
our values
•  respect respect for yourself 
team company and clients
•  energy our relentless desire to 
succeed
•  rapport our ability to build 
trusted relationships with people
•  reward the joy of reaching our 
goals and achieving success
the comprehensive programme will 
consist of training for all employees 
office branding a new reward scheme 
updated hr policies and an extensive 
communications campaign all 
continuing into 2011
in line with the above the group 
takes ethics extremely seriously and 
already has in place a code of business 
conduct and fraud response policy 
with work also well underway to 
evaluate how best to comply with the 
new uk bribery act as part of this the 
group already has in place a dedicated 
independent whistle blowing hotline 
as part of the arrangements set up and 
monitored by the audit committee so 
that employees are able to report any 
matters of concern where this does 
not conflict with local laws or customs 
alternatively matters may be reported 
via the group hr director or group 
company secretary
summary
we are well on track with our csr 
programme and fully expect to make 
even greater progress during 2011
russell clements
chief executive officer
28 january 2011
employees from the sthree singapore office at an incentive event
children in the sos aleppo village syria where an sthree employee 
completed a charity motorcycle ride sthree plc 44
independent auditors’ report 
for the year ended 28 november 2010
independent auditors’ 
report to the members of 
sthree plc
we have audited the financial 
statements of sthree plc for the 
year ended 28 november 2010 
which comprise the consolidated 
statement of comprehensive income 
the consolidated and company 
statements of financial position 
the consolidated and company 
statements of changes in equity 
the consolidated and company 
cash flow statements and the 
related notes the financial reporting 
framework that has been applied in 
their preparation is applicable law 
and international financial reporting 
standards ifrss as adopted by 
the european union and as regards 
the company financial statements 
as applied in accordance with the 
provisions of the companies act 
2006
respective responsibilities of 
directors and auditors 
as explained more fully in the 
statement of directors’ responsibilities 
set out earlier the directors are 
responsible for the preparation of the 
financial statements and for being 
satisfied that they give a true and fair 
view our responsibility is to audit the 
financial statements in accordance 
with applicable law and international 
standards on auditing uk and ireland 
those standards require us to comply 
with the auditing practices board’s 
ethical standards for auditors
this report including the opinions 
has been prepared for and only for 
the company’s members as a body 
in accordance with chapter 3 of part 
16 of the companies act 2006 and for 
no other purpose we do not in giving 
these opinions accept or assume 
responsibility for any other purpose 
or to any other person to whom this 
report is shown or into whose hands 
it may come save where expressly 
agreed by our prior consent in writing
scope of the audit of the 
financial statements 
an audit involves obtaining evidence 
about the amounts and disclosures 
in the financial statements sufficient 
to give reasonable assurance that the 
financial statements are free from 
material misstatement whether 
caused by fraud or error this includes 
an assessment of whether the 
accounting policies are appropriate 
to the consolidated group’s and 
the company’s circumstances and 
have been consistently applied 
and adequately disclosed the 
reasonableness of significant 
accounting estimates made by the 
directors and the overall presentation 
of the financial statements
opinion on financial statements 
in our opinion
• 
the financial statements give a 
true and fair view of the state 
of the consolidated group’s 
and of the company’s affairs 
as at 28 november 2010 and of 
the consolidated group’s profit 
and consolidated group’s and 
company’s cash flows for the year 
then ended
• 
the consolidated group financial 
statements have been properly 
prepared in accordance with ifrss 
as adopted by the european union
• 
the company financial statements 
have been properly prepared in 
accordance with ifrss as adopted 
by the european union and as 
applied in accordance with the 
provisions of the companies act 
2006 and
• 
the financial statements have been 
prepared in accordance with the 
requirements of the companies 
act 2006 and as regards the 
consolidated group financial 
statements article 4 of the las 
regulation
opinion on other matters 
prescribed by the companies 
act 2006 
in our opinion
• 
the part of the directors’ 
remuneration report to be audited 
has been properly prepared in 
accordance with the companies 
act 2006
• 
the information given in the 
directors’ report for the financial 
year for which the financial 
statements are prepared is 
consistent with the financial 
statements and
• 
the information given in the 
corporate governance statement 
set out earlier with respect 
to internal control and risk 
management systems and 
about share capital structures 
is consistent with the financial 
statements
matters on which we are 
required to report by exception 
we have nothing to report in respect 
of the following 
under the companies act 2006 we 
are required to report to you if in our 
opinion
• 
adequate accounting records have 
not been kept by the company or 
returns adequate for our audit have 
not been received from branches 
not visited by us or sthree plc 45
independent auditors’ report  continued 
for the year ended 28 november 2010
• 
the company financial statements 
and the part of the directors’ 
remuneration report to be audited 
are not in agreement with the 
accounting records and returns or
• 
certain disclosures of directors’ 
remuneration specified by law are 
not made or
• 
we have not received all the 
information and explanations we 
require for our audit or
• 
a corporate governance statement 
has not been prepared by the 
parent company
under the listing rules we are 
required to review
• 
the directors’ statement set out 
earlier in relation to going concern 
and
• 
the parts of the corporate 
governance statement relating to 
the company’s compliance with 
the nine provisions of the june 
2008 combined code specified for 
our review
julian jenkins  
senior statutory auditor 
for and on behalf of 
pricewaterhousecoopers llp 
chartered accountants and  
statutory auditors
london
28 january 2011 sthree plc
consolidated statement of comprehensive income
year ended 28 november 2010
 28 november 29 november
 2010 2009
 note £’000 £’000
revenue 2 474451 519372
cost of sales  308083 348217
gross profit 2 166368 171155
administrative expenses 3 145152 162209
operating profit  21216 8946
finance income 5 451 359
finance cost 5 18 378
profit before taxation  21649 8927
analysed as
underlying profit before exceptional items  21649 17977
oneoff exceptional items 3a – 9050
  21649 8927
t axation 6 7366 2965
profit for the year  14283 5962
other comprehensive income
exchange differences on retranslation of foreign operations  3603 243
deferred tax on employee share options  258 620
current tax on employee share options  155 1042
employee share awards  1347 1630
other comprehensive income for the period net of tax  1843 3535
total comprehensive income for the period  12440 9497
profit for the year attributable to
equity holders of the company  14216 4798
noncontrolling interest  67 1164
  14283 5962
total comprehensive income attributable to
owners of the parent  12299 9339
noncontrolling interest  141 158
  12440 9497
earnings per share 8 pence pence
basic before exceptional items  119 95
diluted before exceptional items  115 92
basic after exceptional items  119 40
diluted after exceptional items  115 39
the accompanying notes on pages 51 to 95 are an integral part of these consolidated financial statements
all amounts relate to continuing operations
sthree plc 5 46 sthree plc
statement of financial position
as at 28 november 2010
 consolidated company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
 note £’000 £’000 £’000 £’000
assets
noncurrent assets
property plant and equipment   9 5447 5398 – –
intangible assets   10 10161 10899 – –
investments in subsidiaries   11 – – 245652 238543
deferred tax assets   18 8670 5515 1300 1157
    24278 21812 246952 239700
current assets
t rade and other receivables   12 97935 93229 157 2536
current tax assets   14 – 3309 – –
cash and cash equivalents   22 51718 45272 – 150
assets classified as heldtomaturity  13 3500 3203 – –
    153153 145013 157 2686
total assets    177431 166825 247109 242386
equity and liabilities
equity attributable to the owners of the parent
share capital   19 1218 1218 1218 1218
share premium    2925 2925 2925 2925
capital redemption reserve   19 168 168 168 168
capital reserve   19 878 878 878 878
currency translation reserve    1328 2416 – –
retained earnings    78057 72562 174472 183506
    81918 80167 179661 188695
noncontrolling interest    – 4650 – –
total equity    81918 84817 179661 188695
noncurrent liabilities
provisions for liabilities and charges  17 1354 2889 – –
    1354 2889 – –
current liabilities
provisions for liabilities and charges  17 4237 3063 – –
t rade and other payables   15 86150 76056 67003 53194
financial liabilities   16 22 – – 445 –
current tax liabilities   14 3772 – – 497
    94159 79119 67448 53691
total liabilities    95513 82008 67448 53691
total equity and liabilities    177431 166825 247109 242386
the accompanying notes on pages 51 to 95 are an integral part of these financial statements
these financial statements were approved by the board of directors on 28 january 2011
on behalf of the board of directors
clay brendish   alex smith
chairman   chief financial officer
sthree plc 5 47        attributable
   capital  currency  to owners non
 share share redemption capital translation retained of the controlling total
 capital premium reserve reserve reserve earnings parent interest equity
 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
balance at 30 november 2008 1218 2925 168 878 2331 78906 86426 4147 90573
exchange differences on retranslation of  
foreign operations – – – – 85 – 85 158 243
deferred tax on employee share options – – – – – 620 620 – 620
current tax on employee share options – – – – – 1042 1042 – 1042
net income recognised directly in equity – – – – 85 1662 1747 158 1905
t otal comprehensive income for the year to  
29 november 2009 – – – – – 4798 4798 1164 5962
t otal recognised income and expense for the period – – – – 85 6460 6545 1322 7867
issue of share capital to noncontrolling interest – – – – – – – 160 160
repurchase of noncontrolling interest – – – – – – – 898 898
dividends paid to equity holders – – – – – 14434 14434 – 14434
dividends paid to noncontrolling interest – – – – – – – 81 81
employee share awards – – – – – 1630 1630 – 1630
t otal movements in equity – – – – 85 6344 6259 503 5756
balance at 29 november 2009 1218 2925 168 878 2416 72562 80167 4650 84817
exchange differences on retranslation of foreign operations – – – – 3744 – 3744 141 3603
deferred tax on employee share options – – – – – 258 258 – 258
current tax on employee share options – – – – – 155 155 – 155
net income recognised directly in equity – – – – 3744 413 3331 141 3190
t otal comprehensive income for the year  
28 november 2010 – – – – – 14216 14216 67 14283
t otal recognised income and expense for the period – – – – 3744 14629 10885 208 11093
dividends paid to equity holders – – – – – 14369 14369 – 14369
dividends paid to noncontrolling interest – – – – – – – 970 970
employee share awards – – – – – 1347 1347 – 1347
loss on disposal of noncontrolling interest net assets – – – – – 52 52 52 –
t ransfer to reserves noncontrolling interest net assets – – – – – 3940 3940 3940 –
t otal movements in equity – – – – 3744 5495 1751 4650 2899
balance at 28 november 2010 1218 2925 168 878 1328 78057 81918 – 81918
the accompanying notes on pages 51 to 95 are an integral part of these consolidated financial statements
sthree plc 5 48
sthree plc
consolidated statement of changes in equity
year ended 28 november 2010       capital   attributable
    share share redemption capital retained to company
    capital premium reserve reserve earnings shareholders
    £’000 £’000 £’000 £’000 £’000 £’000
balance at 30 november 2008    1218 2925 168 878 166985 172174
deferred tax on employee share options    – – – – 762 762
expenses recognised directly in equity    – – – – 762 762
t otal comprehensive income for the year to 29 november 2009 note 20   – – – – 28745 28745
t otal recognised income and expense for the period    – – – – 29507 29507
employee share award and option credit    – – – – 1448 1448
dividends paid to equity holders note 7    – – – – 14434 14434
t otal movements in equity    – – – – 16521 16521
balance at 29 november 2009    1218 2925 168 878 183506 188695
deferred tax on employee share options    – – – – 116 116
expenses recognised directly in equity    – – – – 116 116
t otal comprehensive income for the year to 28 november 2010 note 20   – – – – 4879 4879
t otal recognised income and expense for the period    – – – – 4995 4995
employee share award and option credit    – – – – 340 340
dividends paid to equity holders note 7    – – – – 14369 14369
t otal movements in equity    – – – – 9034 9034
balance at 28 november 2010    1218 2925 168 878 174472 179661
of the above reserves only the retained profit of £174472000 2009 £183506000 is distributable
the accompanying notes on pages 51 to 95 are an integral part of these financial statements
sthree plc 5 49
sthree plc
company statement of changes in equity
year ended 28 november 2010 sthree plc 5 50
 consolidated company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
 note £’000 £’000 £’000 £’000
profit before taxation  21649 8927 8123 27003
depreciation and amortisation charge  6313 6128 – –
goodwill recognised in the statement of  
comprehensive income  – 237 – –
loss on disposal of investments  – 478 – 632
finance income 5 451 359 70 162
finance cost 5 18 378 976 1674
loss on disposal of property plant and equipment  110 1107 – –
loss on disposal of intangible assets  1 355 – –
noncash charge for employee share options 
and awards  1656 1448 340 511
operating cashflow before changes in  
working capital and provisions  29296 18225 9369 29658
increasedecrease in receivables  3652 50952 2379 162
increasedecrease in payables  9746 7704 11375 10563
decreaseincrease in provisions  3625 2011 – –
cash flows from operating activities
cash generated from operating activities  31765 63484 23123 18933
income tax paidreceived  5958 18267 2200 351
net cash generated from operating activities  25807 45217 20923 18582
cash flows from investing activities
purchase of property plant and equipment 9 2836 2726 – –
purchase of intangible assets 10 2922 2128 – –
sale of heldtomaturity investment 13 3203 – – –
purchase of heldtomaturity investment 13 3500 3203 – –
proceeds from disposal of investments  – 40 – 30
net cash used in investing activities  6055 8017 – 30
cash flows from financing activities
finance income 5 451 359 70 162
finance cost 5 18 378 976 1674
employee subscription for share awards  435 182 – –
issue of share capital of subsidiary companies to  
noncontrolling interest  34 10 – –
recapitalisation of subsidiary company  – – 6000 –
repurchase of noncontrolling interest  – 1371 243 1349
dividends paid to equity holders 7 14369 14434 14369 14434
dividends paid to noncontrolling interest  970 81 – –
net cash used in financing activities  14437 15713 21518 17295
net increase in cash and cash equivalents  5315 21487 595 1317
cash and cash equivalents at the beginning of the year  45272 24584 150 1167
effect of exchange rate changes  1131 799 – –
cash and cash equivalents at the end of the year 22 51718 45272 445 150
the accompanying notes on pages 51 to 95 are an integral part of these financial statements
sthree plc
statement of cash flows
year ended 28 november 2010 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 51
1 accounting policies
the company ‘the company’ and its subsidiaries together ‘the group’ operate predominantly in the united kingdom and 
continental europe the group’s activities and business are set out in the directors’ report
the company is a public limited liability company incorporated and domiciled in the united kingdom and the company is 
listed on the london stock exchange the address of its registered office is 5th floor gps house 215227 great portland 
street london w1w 5pn
the principal accounting policies applied in the preparation of the consolidated financial statements are set out below
basis of preparation
these financial statements have been prepared in accordance with international financial reporting standards ‘ifrss’ 
as issued by the international accounting standards board ‘iasb’ international financial reporting interpretations 
committee ‘ifric’ interpretations and standing interpretations committee ‘sic’ interpretations as adopted and endorsed 
by the european union ‘eu’ and with those parts of the companies act 2006 applicable to companies reporting under 
ifrs therefore the group financial statements comply with article 4 of the eu international accounting standards 
regulation
the group’s consolidated financial statements have been prepared under the historical cost convention as modified by 
the revaluation of financial assets and financial liabilities at fair value through the statement of comprehensive income 
the company’s financial statements have been prepared on the same basis and as permitted by section 408 of the 
companies act 2006 no statement of comprehensive income is presented for the company
the financial year of the group comprises 52 weeks and not a calendar year
the group’s accounting policies as set out below have been consistently applied to all the periods presented unless 
otherwise stated
the group’s consolidated financial statements have been prepared in accordance with ifrs since 1 december 2004 the 
preparation of financial statements in conformity with ifrs requires the use of certain critical accounting estimates 
it also requires management to exercise its judgement in the process of applying the group’s accounting policies 
management consider that the areas involving a higher degree of judgement or complexity or areas where assumptions 
and estimates affect the consolidated financial statements do not substantially impact the results
the group has adopted the following ifrs ifric and amendments with effect from 30 november 2009 apart from 
presentational changes and revised disclosures they did not have a material effect on the results or net assets of the 
group
amendments to ias 1 ‘presentation of financial statements’ effective from periods commencing on or after 1 january 
2009 the revised standard affects the presentation of other changes in equity and introduces a statement of 
comprehensive income the group have the option of presenting items of income and expense and components of 
other comprehensive income either in a single statement of comprehensive income with subtotals or in two separate 
statements a separate income statement followed by a statement of other comprehensive income
amendments to ias 23 ‘borrowing costs’ effective from periods commencing on or after 1 january 2009 eliminates 
the option to recognise all borrowing costs immediately as an expense t o the extent that borrowing costs relate to the 
acquisition construction or production of a qualifying asset the revised standard requires that they be capitalised as 
part of the cost of that asset all other borrowing costs should be expensed as incurred sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 52
1 accounting policies continued
amendments to ias 27 ‘consolidated and separate financial statements’ and ifrs 3 ‘business combinations’ are 
effective from periods commencing on or after 1 july 2009 the amendments relate primarily to accounting for 
noncontrolling interest and the losses of control of a subsidiary they also address the guidance for applying the 
acquisition method of accounting
amendments to ias 39 ‘financial instruments recognition and measurement’ in respect of eligible hedged items 
effective from periods commencing on or after 1 july 2009 it provides clarification on identifying inflation as a hedged 
risk or portion and hedging with options
amendments to ifrs 2 ‘sharebased payment’ effective from periods commencing on or after 1 january 2009 
clarifies terms ‘vesting conditions’ and ‘cancellations’ with proposed recognition and measurement criteria
effective from periods commencing on or after 1 january 2009 the amendments to ifrs 7 ‘financial instruments 
disclosures’ require enhanced disclosures about fair value measurements and liquidity risk in the wake of the recent 
financial crisis
ifrs 8 ‘operating segments’ effective from periods commencing on or after 1 january 2009 sets out requirements for 
disclosure of information about an entity’s operating segments and also about the entity’s products and services the 
geographical areas in which it operates and its major customers this standard replaces ias 14 ‘segment reporting’ 
and requires a change in the disclosure of segmental information
ifric 17 ‘distributions of noncash assets to owners’ effective from periods commencing on or after 1 july 2009 
provides guidance on the appropriate accounting treatment when an entity distributes assets other than cash as 
dividends to its shareholders
as at the date of authorisation of these financial statements the following standards and interpretations were in issue but 
not yet effective the group has not applied these standards and interpretations in the preparation of financial statements
the revised standard ias 24 ‘related parties disclosure’ is effective from periods commencing on or after 1 january 
2011 the standard revises the definition of a related party and clarifies that disclosure is required of any commitments 
of a related party to do something if a particular event occurs or does not occur in the future including executory 
contracts recognised and unrecognised
amended ias 32 ‘financial instruments presentation’ addresses the accounting for rights issues rights options or 
warrants that are denominated in a currency other than the functional currency of the issuer it requires that rights 
options or warrants to acquire a fixed number of an entity’s own equity instruments for a fixed amount of any currency 
are equity instruments regardless of the currency in which the exercise price is denominated if the entity offers 
the rights options or warrants pro rata to all of its existing owners of the same class of its own nonderivative equity 
instruments the amendment is effective from periods commencing on or after 1 february 2010
ifrs 9 ‘financial instruments’ will establish principles for the financial reporting of financial assets that will present 
relevant and useful information to users of financial statements for their assessment of the amounts timing and 
uncertainty of the entity’s future cash flows the standard is applicable for periods commencing on or after 1 january 
2013
ifric 19 ‘extinguishing financial liabilities with equity instruments’ effective from periods commencing on or after 
1 july 2010 addresses the accounting by an entity when the terms of a financial liability are renegotiated and result in 
the entity issuing equity instruments to a creditor of the entity to extinguish all or part of the financial liability sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 53
1 accounting policies continued
the impact on the group’s financial statements of the future adoption of these standards and interpretations is still under 
review but the group does not expect any of these changes to have a material effect on the results or net assets of the 
group
consolidation
the consolidated financial statements incorporate the financial statements of the company and of its subsidiaries 
subsidiaries are all entities over which the company has the power to govern the financial and operating policies 
generally accompanying a shareholding of more than one half of the voting rights subsidiaries are fully consolidated from 
the date on which control is transferred to the group they are deconsolidated from the date when control ceases
disposals of noncontrolling interests result in gains and losses for the group that are recorded in the statement of 
changes in equity purchases from noncontrolling interests are accounted for using the parent company method 
goodwill is calculated as being the difference between any consideration paid and the relevant share acquired of the 
carrying value of net assets of the subsidiary
foreign currencies
i functional and presentation currency
items included in the financial statements of each of the group’s subsidiaries are measured using the currency of the 
primary economic environment in which that subsidiary operates its ‘functional currency’ the consolidated financial 
statements of the group are presented in pounds sterling which is the group’s functional and presentation currency
ii t ransactions and balances
foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the 
dates of the transactions foreign exchange gains and losses resulting from the settlement of such transactions and 
from the translation at periodend exchange rates of monetary assets and liabilities denominated in foreign currencies 
are recognised in the statement of comprehensive income
iii group companies
the results and financial position of all of the group’s subsidiaries none of which has the currency of a hyper
inflationary economy that have a functional currency different from the group’s presentational currency are 
translated into the presentational currency as follows
–  assets and liabilities for each statement of financial position presented are translated at the rate ruling at the end 
of the reporting period
–  income and expenses for each statement of comprehensive income are translated using the average rate of 
exchange unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on 
the transaction dates in which case income and expenses are translated at the dates of the transactions
–  all resulting exchange differences are recognised in other comprehensive income
the group treats specific intercompany loan balances which are not intended to be settled for the foreseeable future as 
part of its net investment in the relevant subsidiaries on consolidation exchange differences arising from the translation 
of the net investment in foreign entities and of borrowings and other currency instruments designated as hedges of such 
investments are taken to shareholders’ equity when a foreign operation is sold such exchange differences are removed 
from equity and recognised in the statement of comprehensive income as part of the gain or loss on sale sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 54
1 accounting policies continued
revenue and revenue recognition
revenue comprises the fair value of the consideration received or receivable for the provision of services provided in the 
ordinary course of the group’s activities revenue is shown net of value added tax and other sales taxes returns rebates 
and discounts and after elimination of sales within the group
contract revenue for the supply of professional services is recognised based on the number of hours worked by a 
contractor
revenue for permanent placements is recognised when candidates commence employment a provision is established for 
nonfulfilment of permanent placement obligations
interest income is recognised as the interest accrues to the net carrying amount of the financial asset
segment reporting
the group operates in one business segment being that of recruitment services the group operates in three geographic 
segments being the united kingdom continental europe and the rest of the world
dividends
interim dividends are recognised in the financial statements at the time they are paid the final dividends declared to the 
company’s shareholders are recognised as a liability in the company’s and group’s financial statements in the period in 
which the dividends are approved by the company’s shareholders
the company recognises dividends from subsidiaries at the time that they are received
property plant and equipment
property plant and equipment is stated at historical cost less accumulated depreciation historical cost includes 
expenditure that is directly attributable to the acquisition of the items
depreciation is calculated using the straightline method to allocate the depreciable value of property plant and 
equipment to the statement of comprehensive income over their useful economic lives as follows
 computer equipment 3333 per annum
 leasehold improvement 20 per annum
 fixtures and fittings 20 per annum
 motor vehicles 3333 per annum
assets’ residual values and useful lives are reviewed and adjusted if appropriate at the end of the reporting period
subsequent costs are included in the asset’s carrying amount or recognised as a separate asset as appropriate only when 
it is probable that future economic benefits associated with the item will flow to the group and the cost of the item can be 
measured reliably all other repairs and maintenance are charged to the statement of comprehensive income during the 
financial period in which they are incurred
gains and losses on disposals are determined by comparing proceeds with carrying amounts these are included in the 
statement of comprehensive income an assets carrying amount is written down immediately to its recoverable amount if 
the assets carrying value is greater than its estimated recoverable amount sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 55
1 accounting policies continued
intangible assets
goodwill
goodwill represents the excess of the cost of an acquisition over the fair value of the group’s share of the net identifiable 
assets of the acquired subsidiary at the date of acquisition goodwill on the acquisition of subsidiaries is included in 
intangible assets goodwill is tested annually for impairment and carried at cost less accumulated impairment losses 
any impairment is recognised immediately in the statement of comprehensive income and is not subsequently reversed 
gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold
assets under construction
purchased fixed assets or internally generated intangible assets that are still under development are classified as ‘assets 
under construction’ these assets are reclassified over the phased completion dates and are amortised from the date they 
are reclassified
computer software
the cost of acquired computer software licenses is capitalised these costs are amortised over their estimated useful 
lives up to three years
costs associated with maintaining computer software programmes are recognised as an expense to the statement of 
comprehensive income when incurred
software and system development costs
costs incurred on development projects relating to the design or improvement of systems are recognised as intangible 
assets when the ias 38 ‘intangible assets’ recognition criteria are met capitalised software and system development 
costs are amortised from the date the system is available for use over their expected useful lives not exceeding five 
years
research expenditure is recognised as an expense to the statement of comprehensive income as incurred
trademarks
t rademarks are initially recognised at cost they have a definite useful life and are carried at cost less accumulated 
amortisation amortisation is calculated using the straightline method to allocate the cost of trademarks over their 
estimated useful lives up to twelve years
impairment of assets
assets that are not subject to amortisation are tested annually for impairment
assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances 
indicate that the carrying amount may not be recoverable an impairment loss is recognised for the amount by which the 
asset’s carrying amount exceeds its recoverable amount by analysing individual assets or classes of assets that naturally 
belong together the recoverable amount is the higher of an asset’s fair value less costs to sell and value in use value 
in use is measured based on the expected future discounted cash flows ‘dcf’ model attributable to the asset for the 
purposes of assessing impairment assets are grouped at the lowest levels for which there are separately identifiable cash 
flows cash generating units sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 56
1 accounting policies continued
significant judgements and estimates
the preparation of financial statements in conformity with generally accepted accounting principles requires the use 
of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial 
statements and the reported amounts of revenues and expenses during the reporting period although these estimates 
are based on the directors’ best knowledge of the amounts actual results may ultimately differ from those estimates 
the ‘critical accounting judgements and key sources of estimation uncertainty’ made by the directors in these financial 
statements are set out below
a number of significant assumptions and estimates are involved in using dcf models to forecast operating cash flows 
eg with respect to factors such as market growth rates revenue volumes market prices for services and working capital 
requirements forecasts of future cash flows are based on best estimates of future revenues and operating expenses 
using historical trends general market conditions industry trends and forecasts and other available information these 
assumptions are subject to review by management and the board of directors the cash flow forecasts are adjusted by an 
appropriate pretax discount rate derived from the group’s cost of capital
i  the determination of the carrying amount of capitalised software and systems development costs and assets under 
construction with the related amortisation estimation of useful economic life and recoverability of such assets is 
deemed to be judgemental
ii  the group follows the guidance of ias 39 to determine when trade and other receivables are impaired this determination 
requires significant judgement in making this judgement the group evaluates amongst other factors the duration and 
extent to which the carrying values of a receivable is less than its cost the risk profile of the client and other credit rating 
factors the financial health historical experience of and nearterm business outlook for the client
iii  revenue is recognised when the supply of professional services has been rendered it also includes an assessment 
of professional services received by the client for the placement of temporary services between the date of the last 
received timesheet and the year end unsubmitted timesheets are estimated to the extent that an open contract has 
not expired during the period under assessment management apply judgement to several factors in estimating the 
revenue and cost of sales accruals any difference compared to actual experience would result in the amount payable 
to the contractor and receivable from the client being adjusted in the next financial year the judgement applied 
and the assumptions underlying these judgements are considered to be appropriate however a change in these 
assumptions would impact upon both the amount of revenue and cost of sales recognised
iv  the group recognised a net deferred tax asset of £87m 2009£55m of which £71m 2009£44m related to trading 
losses that are to be carried forward and relieved against profits arising in future periods the judgement to recognise 
the deferred tax asset is dependent upon the group’s expectations regarding future profitability based upon subsidiary 
revenue and cost forecasts for future years which contain a degree of inherent uncertainty
v  the fair value of equity settled sharebased payments is partly derived from estimates of factors such as lapse rates 
and achievement of performance criteria it is also derived from assumptions such as the future volatility of the 
company’s share price expected dividend yields and riskfree interest rates
vi  goodwill and investments are tested for impairment on an annual basis in performing these tests assumptions are made in 
respect of future growth rates and the discount rate to be applied to the future cash flows of cash generating units
investments
the company’s investments in shares in group companies are stated at cost less provisions for impairment any 
impairment is charged to the statement of comprehensive income as it arises sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 57
1 accounting policies continued
where sharebased payments are granted to the employees of subsidiary undertakings by the parent company they 
are treated as a capital contribution to the subsidiary and the company’s investment in the subsidiary is increased 
accordingly
financial assets
nonderivative financial assets are classified as either ‘held to maturity’ or ‘loans and receivables’ the classification 
depends on the nature and purpose of the financial assets and is determined at the time of initial recognition
held to maturity financial assets
heldtomaturity financial assets comprises investments with fixed or determinable payments and fixed maturity for 
which there is a positive intention and ability to hold to maturity and which have not been designated at fair value through 
the statement of comprehensive income or as available for sale
heldtomaturity financial assets are measured at amortised cost using the effective interest method
loans and receivables
loans and receivables are nonderivative financial assets with fixed or determinable payments that are not quoted in 
an active market they are included in current assets except for maturities greater than 12 months after the end of the 
reporting period these are classified as noncurrent assets the group’s loans and receivables comprise ‘trade and other 
receivables’ and ‘cash and cash equivalents’ in the statement of financial position
trade and other receivables
t rade accounts receivable are recorded at net realisable value after deducting an allowance for doubtful accounts the 
group makes judgements on an entity by entity basis as to its ability to collect outstanding receivables and provides an 
allowance for doubtful accounts based on a specific review of significant outstanding invoices for those invoices not 
specifically reviewed provisions are provided at differing percentages based on the age of the receivable in determining 
these percentages the group analyses its historical collection experience and current economic trends t rade receivable 
balances are written off when the group determines that it is unlikely that future remittances will be received
cash and cash equivalents
cash and cash equivalents include cash in hand deposits held at call with banks other shortterm highly liquid 
investments with original maturities of three months or less and bank overdrafts bank overdrafts are shown within 
current financial liabilities on the statement of financial position unless they form part of a cash pooling arrangement in 
which case they are reported net of related cash balances
financial liabilities
all nonderivative financial liabilities are classified as ‘other financial liabilities’ and are initially measured at fair value net 
of transaction costs other financial liabilities are subsequently measured at amortised cost using the ‘effective interest 
rate’ method financial liabilities are classified as current liabilities unless the group has an unconditional right to defer 
settlement of the liability for at least twelve months after the end of the reporting period
net investment hedging
financial instruments are classified as net investment hedges when they hedge the group’s net investment in an 
overseas operation the effective element of any foreign exchange gain or loss from remeasuring the derivative 
instrument is recognised directly in other comprehensive income any ineffective element is recognised immediately in 
the group statement of comprehensive income sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 58
1 accounting policies continued
leases
leases where substantially all the risks and rewards of ownership of assets remain with the lessor are accounted for as 
operating leases payments made under operating leases net of any incentives received from the lessor are charged to the 
statement of comprehensive income on a straightline basis over the lease periods
trade and other payables
t rade and other payables are stated at cost
short term financial liabilities and overdrafts
financial liabilities are recognised initially at fair value net of transaction costs incurred financial liabilities are 
subsequently stated at amortised cost any difference between the proceeds net of transaction costs and the 
redemption value is recognised in the statement of comprehensive income over the period of the borrowings using the 
effective interest method
financial liabilities are classified as current liabilities unless the group has an unconditional right to defer settlement of 
the liability for at least 12 months after the end of the reporting period
provisions
provisions are recognised when the group has a legal or constructive obligation as a result of past events and it is more 
likely than not that an outflow of resources will be required to settle the obligation and the amount has been reliably 
estimated
provisions are recognised as the present value of the expenditures expected to be required to settle the obligation no 
provision is recognised for future operating losses
where there are a number of similar obligations the likelihood that an outflow will be required in settlement is determined 
by considering the class of obligation as a whole a provision may be recognised even if the likelihood of an outflow with 
respect to any one item included in the same class of obligations may be small
t axation
corporation tax expense represents the sum of the tax currently payable and deferred tax
the tax currently payable is based on taxable profits for the period t axable profit differs from profit as reported in the 
statement of comprehensive income because it excludes items of income or expense that are taxable or deductible 
in other years and it further excludes items that are never taxable or deductible the group’s liability for current tax is 
calculated using tax rates that have been enacted or substantially enacted by the end of the reporting period
deferred tax is provided in full using the liability method on temporary differences arising between the tax bases of 
assets and liabilities and their carrying amounts in the consolidated financial statements deferred tax is determined 
using tax rates that have been enacted or substantially enacted by the end of the reporting period and are expected to 
apply when the related deferred tax asset is realised or the deferred tax liability is settled
deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which 
the temporary differences can be utilised sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 59
1 accounting policies continued
share capital
ordinary shares are classified as equity incremental costs directly attributable to the issue of new shares or options are 
shown in equity as a deduction net of tax from the proceeds
employee benefits
wages salaries bonuses social security contributions paid annual leave and sick leave are accrued in the period in 
which the associated services are rendered by employees of the group
pension obligations — the group has defined contribution plans and pays contributions to privately administered 
pension plans on a mandatory contractual or voluntary basis the group has no further payment obligations once the 
contributions have been paid
bonus plans — the group recognises a liability and an expense for bonuses based on the directors’ best estimate of the 
amounts due the group recognises a provision where contractually obliged or where there is a past practice of payments 
that has created a constructive obligation
t ermination benefits — t ermination benefits are payable when employment is terminated before the normal retirement 
date or whenever an employee accepts voluntary redundancy in exchange for those benefits the group recognises 
termination benefits when it is demonstrably committed to either terminating the employment of current employees 
according to a detailed formal plan without the possibility of withdrawal or providing termination benefits as a result of an 
offer made to encourage voluntary redundancy
employee benefit trusts
the employee benefit t rusts ‘ebt’ were funded by gifts from certain of the company’s shareholders and directors the 
assets and liabilities of the ebt are consolidated into the group’s consolidated financial statements
the ebt’s main assets are the ordinary shares in the group which were gifted and hence no cost is attributed to 
those shares and no amounts are shown in the group’s financial statements the ebt also holds shares which were 
subsequently newly issued in order to satisfy awards under the share option schemes and long t erm incentive plan 
‘l tip’
the shares in the ebt are held for awards and grants under the employee share award share option schemes and l tip 
sharebased compensation
the cost of equitysettled transactions with employees is measured by reference to the fair value at the date at which 
equity instruments are granted and is recognised as an expense over the vesting period which ends on the date on which 
the relevant employees become fully entitled to the award fair value is determined by using an appropriate valuation 
model in valuing equitysettled transactions no account is taken of any vesting conditions other than market conditions
no expense is recognised for awards that do not ultimately vest except for awards where vesting is conditional upon a 
market condition which are treated as vesting irrespective of whether or not the market condition is satisfied provided 
that all other performance conditions are satisfied sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 60
1 accounting policies continued
at the end of the reporting period before vesting the cumulative expense is calculated representing the extent to 
which the vesting period has expired and management’s best estimate of the achievement or otherwise of nonmarket 
conditions and the number of equity instruments that will ultimately vest or in the case of an instrument subject to a 
market condition be treated as vesting as described above the movement in cumulative expense since the previous end 
of the reporting period is recognised in the statement of comprehensive income with a corresponding entry in equity
for certain share based payment settlements there exists an obligation on the group to repay amounts if the employee 
leaves the employment of the group before the settlement vests in these circumstances a provision is established in 
relation to this obligation
where the terms of an equitysettled award are modified or a new award is designated as replacing a cancelled or settled 
award the cost based on the original award terms continues to be recognised over the original vesting period in addition 
an expense is recognised over the remainder of the new vesting period for the incremental fair value of any modification 
based on the difference between the fair value of the original award and the fair value of the modified award both as 
measured on the date of the modification no reduction is recognised if this difference is negative
where an equitysettled award is cancelled it is treated as if it had vested on the date of cancellation and any cost not yet 
recognised in the statement of comprehensive income for the award is expensed immediately any compensation paid 
up to the fair value of the award at the cancellation or settlement date is deducted from equity with any excess over fair 
value being treated as an expense in the statement of comprehensive income
exceptional items
items which are of a nonrecurring nature and material when considering both size and nature have been disclosed 
separately to give a clearer presentation of the group‘s results these items are shown as “exceptional items” on the face 
of the statement of comprehensive income
restructuring costs
provision is made for restructuring costs including the costs of redundancy when the group has an actual or 
constructive obligation to pay amounts to third parties an obligation exists when the group has a detailed formal plan for 
the restructuring and has raised a valid expectation of those affected by starting to implement the plan or announcing its 
main features sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 61
2 segmental analysis
ifrs 8 requires management to apply the ‘management approach’ to segmental reporting this requires management to 
determine those segments whose operating results are reviewed regularly by the entity’s chief operating decision maker 
to make strategic decisions and assess sector performance
revenue and gross profit by reportable segment
management has determined the chief operating decision maker to be the executive committee made up of the chief 
executive officer the chief financial officer the chief development officer the chief information officer the director of 
strategic planning the managing directors and key function heads operating segments have been identified based on 
reports reviewed by the executive committee which considers the business primarily from the geographic perspective
the group’s management reporting and controlling systems use accounting polices that are the same as those described 
in note 1 in the summary of significant accounting policies under ifrs
the group measures the performance of its operating segments through a measure of segment profit or loss which is 
referred to as “gross profit” in the management and reporting system gross profit is the measure of segment profitloss 
used in segment reporting and comprises revenue and cost of sales
intersegment revenue is recorded at values which approximate third party selling prices and is not significant
united kingdom
    28 november 29 november
    2010 2009
    £’000 £’000
revenue from external customers    224337 271248
gross profit    66820 76939
t otal assets    118099 130518
t otal liabilities    62496 59405
capital expenditure    4751 3411
continental europe
    28 november 29 november
    2010 2009
    £’000 £’000
revenue from external customers    226694 239406
gross profit    82213 86762
t otal assets    46115 27767
t otal liabilities    31397 20957
capital expenditure    611 918 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 62
2 segmental analysis continued
rest of the world
    28 november 29 november
    2010 2009
    £’000 £’000
revenue from external customers    23420 8718
gross profit    17335 7454
t otal assets    13217 8540
t otal liabilities    1620 1646
capital expenditure    396 525
group
    28 november 29 november
    2010 2009
    £’000 £’000
revenue from external customers    474451 519372
gross profit    166368 171155
t otal assets    177431 166825
t otal liabilities    95513 82008
capital expenditure    5758 4854
the following segmental analyses by brand recruitment classification and discipline being the profession of candidates 
placed have been included as additional disclosure over and above the requirements of ifrs 8 ‘operating segments’
     revenue  gross profit
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
brand
progressive  133780 132461 45416 41918
huxley associates  125843 132670 44892 44839
computer futures solutions  111875 149247 37745 51526
real staffing group  98938 101679 34300 29557
others  4015 3315 4015 3315
  474451 519372 166368 171155
recruitment classification
contract  392803 447077 84954 98816
permanent  81648 72295 81414 72339
  474451 519372 166368 171155
discipline
information  communication technology  341484 411761 102610 122612
others 
1
  132967 107611 63758 48543
  474451 519372 166368 171155
1
 including engineering and energy banking accountancy and finance pharmaceuticals and job board sectors sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 63
3 administrative expenses
a exceptional items
exceptional items are those items which because of their size incidence or nature are separately disclosed to give a 
proper understanding of the underlying results for the period items classified as exceptional are as follows
    28 november 29 november
    2010 2009
    £’000 £’000
exceptional items — charged to operating profit
corporate and divisional restructuring    – 9050
exceptional items — before taxation    – 9050
corporate and divisional restructuring
during the prior period the company announced a number of changes relating to corporate and divisional restructuring 
the total cost of this restructuring including redundancy relocation and consolidation of business was considered 
exceptional by virtue of its size the group charged the restructuring cost incurred in the prior period to the statement of 
comprehensive income sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 64
3 administrative expenses continued
b administrative expenses — other
operating profit is stated after chargingcrediting
      28 november 29 november
    2010 2009
analysis of costs by nature    £’000 £’000
net trade receivables provision chargerelease note 12    211 736
depreciation note 9    2925 2953
amortisation of intangible assets note 10
— software and systems development costs    3000 2466
— t rademarks    3 6
— computer software    385 703
foreign exchange gains    1016 2772
staff costs note 4    106617 107363
loss on disposal of investments    – 478
loss on disposal of property plant and equipment    110 1107
loss on disposal of intangible assets    1 355
operating lease charges     
— motor vehicles    1449 2251
— land and buildings    7477 7608
during the year the group including its overseas subsidiaries obtained the following services from the group’s auditors at 
the costs detailed below
      28 november 29 november
    2010 2009
amounts payable to pricewaterhousecoopers    £’000 £’000
fees payable to the company’s auditor for the audit of parent and 
consolidated financial statements    120 118
fees payable to the company’s auditor and its associates for other services
— the audit of the company’s subsidiaries pursuant to legislation  377 450
— other services pursuant to legislation    40 55
— other assurance services    10 134
— t axation advice    165 401
— other services    383 42
costs charged to operating profit    1095 1200 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 65
4 directors and employees
staff costs and employee numbers consist of
      28 november 29 november
    2010 2009
    £’000 £’000
wages and salaries including bonuses    90356 92319
social security costs    13475 12576
pension costs    699 678
t emporary staff costs    431 342
cost of employee share options and awards note 19    1656 1448
    106617 107363
the average number of employees including directors during the year was
      28 november 29 november
    2010 2009
    number number
geographic analysis
united kingdom
— sales    527 638
— nonsales    427 411
    954 1049
europe and rest of world
— sales    742 723
— nonsales    76 69
    818 792
    1772 1841
included in the headcount numbers above is a total of 80 2009 52 temporary shortterm full time employees
information on directors’ emoluments and interests which forms part of these audited financial statements is given in 
the directors’ remuneration report
the company had an average of 9 2009 4 employees in the year ended 28 november 2010 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 66
5 finance income and cost
    28 november 29 november
    2010 2009
    £’000 £’000
finance income
bank interest receivable    451 359
    451 359
finance cost
bank loans and overdrafts    18 378
    18 378
net finance incomecost    433 19
6 t axation
a analysis of tax charge for the year
    28 november 29 november
    2010 2009
    £’000 £’000
current taxation
uk
corporation tax chargedcredited at  
28 2009 28 on profits for the year    9195 4732
adjustments in respect of prior periods    583 1447
overseas
corporation tax chargedcredited on  
profits for the year    1274 1725
adjustments in respect of prior periods    768 329
t otal current tax chargecredit    10284 4681
deferred taxation
origination and reversal of temporary  
differences    3862 3401
adjustments in respect of prior periods    992 2079
schedule 23 deferred tax credit in respect  
of unexercised employee share awards  
and options    48 394
t otal deferred tax creditcharge    2918 1716
total income tax charge in the  
statement of comprehensive income    7366 2965 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 67
6 t axation continued
b reconciliation of the effective tax rate
the group‘s tax charge for the year ended 28 november 2010 exceeds the uk statutory rate and can be reconciled as 
follows
 28 november 29 november
  2010  2009
  £’000  £’000 
profit before taxation  21649  8927 
profit before tax multiplied by standard rate  
of corporation tax in the uk  6062 28 2500 28
effects of
disallowable items  80 – 59 1
differing tax rates on overseas earnings  376 2 103 1
adjustments to tax in respect of previous periods  807 4 303 3
adjustment due to uk tax rate change  41 – – –
t ax expense and effective tax rate  7366 34 2965 33
c current and deferred tax movement recognised directly in equity
    28 november 29 november
    2010 2009
    £’000 £’000
current tax
equity settled employee share options    155 1042
deferred tax
equity settled employee share options    258 620
    413 1662
the group expects to receive additional tax deductions in respect of the share awards and share options currently 
unexercised under ifrs the group is required to provide for deferred tax on all unexercised share awards and options 
at 28 november 2010 a deferred tax asset of £21m 2009 £18m has been recognised in respect of these options note 18 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 68
7 dividends
    28 november 29 november
    2010 2009
    £’000 £’000
amounts recognised and distributed to shareholders in the year  
equity
interim dividend of 40p 2009 40p per ordinary share    4782 4738
second interim dividend of 80p 2009 nil per ordinary share    9587 –
final dividend of nil 2009 80p per ordinary share    – 9696
    14369 14434
amounts proposed
interim dividend of 40p 2009 40p per ordinary share for the period ended  
30 may 2010    4797 4782
second interim dividend of nil 2009 80p per ordinary share for the year ended  
28 november 2010    – 9544
final dividend of 80p 2009 nil per ordinary share for the year ended  
28 november 2010    9594 –
an interim dividend of 40 pence 2009 40 pence per ordinary share for the six months ended 31 may 2009 was paid on 
4 december 2009 to shareholders on record at 6 november 2009
for the year ended 29 november 2009 instead of a final dividend a second interim dividend of 80 pence per ordinary 
share was paid on 31 march 2010 to shareholders on record at 26 february 2010
an interim dividend of 40 pence 2009 40 pence per ordinary share for the six months ended 30 may 2010 was paid on 
3 december 2010 to shareholders on record at 5 november 2010
the board propose a final dividend of 80 pence per ordinary share for the year ended 28 november 2010 2009 nil to be 
paid on 6 june 2011 to shareholders on record at 6 may 2011 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 69
8 earnings per share
the calculation of the basic and diluted earnings per share ‘eps’ is based on the following data
basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted 
average number of ordinary shares in issue during the year excluding those held in the ebt which are treated as 
cancelled
for diluted earnings per share the weighted average number of ordinary shares in issue is adjusted to assume conversion 
of dilutive potential ordinary shares
    28 november 29 november
    2010 2009
    £’000 £’000
earnings
profit after taxation excluding exceptional items    14283 12438
non controlling interest    67 1164
adjusted profit for the year attributable to the equity holders of the company excluding  
exceptional items    14216 11274
effect of exceptional items net of tax    – 6476
profit after taxation attributable to equity holders of the company   14216 4798
    millions millions
number of shares
weighted average number of shares used for basic eps    1199 1187
dilutive effect of share plans    39 38
diluted weighted average number of shares used for diluted eps   1238 1225
    pence pence
basic
basic earnings per share    119 40
adjusted basic earnings per share excluding exceptional items    119 95
diluted
diluted earnings per share    115 39
adjusted diluted earnings per share excluding exceptional items   115 92 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 70
9 property plant and equipment
 computer leasehold fixtures and motor
 equipment improvements fittings vehicles total
 £’000 £’000 £’000 £’000 £’000
cost
at 30 november 2008 10424 4508 3405 469 18806
additions 1493 765 337 131 2726
disposals 905 1009 790 322 3026
exchange difference 193 83 117 – 393
at 29 november 2009 11205 4347 3069 278 18899
additions 1818 589 337 92 2836
disposals 2125 45 134 211 2515
reclassification note 10 51 156 64 – 271
exchange difference 107 18 74 – 199
at 28 november 2010 10842 5029 3262 159 19292
depreciation
at 30 november 2008 8361 1898 1777 195 12231
charge for the year 1561 785 504 103 2953
disposals 699 618 444 158 1919
exchange difference 147 36 53 – 236
at 29 november 2009 9370 2101 1890 140 13501
charge for the year 1451 878 470 126 2925
disposals 2080 38 117 169 2404
exchange difference 91 41 45 – 177
at 28 november 2010 8650 2900 2198 97 13845
net book value
at 28 november 2010 2192 2129 1064 62 5447
at 29 november 2009 1835 2246 1179 138 5398 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 71
10 intangible assets
    software and
  intangible  system
  assets under computer development
 goodwill construction software cost trademarks total
 £’000 £’000 £’000 £’000 £’000 £’000
cost
at 30 november 2008 206899 639 2564 12865 71 223038
additions 710 1479 199 450 – 2838
disposals 674 – – 355 – 1029
exchange difference – – 3 – – 3
reclassification – 790 – 790 – –
at 29 november 2009 206935 1328 2766 13750 71 224850
additions – 2270 652 – – 2922
disposals – – 1 – – 1
reclassification note 9 – 1885 – 1614 – 271
at 28 november 2010 206935 1713 3417 15364 71 227500
amortisation and impairment
at 30 november 2008 205687 – 1624 3410 55 210776
charge for the year – – 703 2466 6 3175
at 29 november 2009 205687 – 2327 5876 61 213951
charge for the year – – 385 3000 3 3388
at 28 november 2010 205687 – 2712 8876 64 217339
net book value
at 28 november 2010 1248 1713 705 6488 7 10161
at 29 november 2009 1248 1328 439 7874 10 10899
the remaining useful life of significant intangible assets ranges between 1 to 5 years sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 72
10 intangible assets continued
goodwill
the net book value at 28 november 2010 and 29 november 2009 along with changes in goodwill are as follows
   transfer  
  of goodwill net book value
   group’s 2010 2010 2009
investment in   shareholding £000 £000 £000
sthree staffing uk limited   100 833 833 –
strategic resource group limited   100 154 – 154
jobboard enterprises limited   87 – 415 415
new wave resourcing limited   100 1 – 1
staff search group limited   100 26 – 26
progressive sas   100 5 – 5
madison black limited   100 421 – 421
j p gray limited   100 226 – 226
    – 1248 1248
during the year the group started to reorganise and simplify its corporate structure resulting in the consolidation of 
various businesses across uk and europe in assessing the group’s cash generating units the carrying value of goodwill 
will not be affected by the transfer or sale of different business units across the group the transfer figures above show 
the post reorganisation effect on the carrying value of goodwill being transferred to sthree staffing uk limited
impairment of goodwill
goodwill has been tested for impairment by comparing the carrying amount of each cashgenerating unit including 
goodwill with the recoverable amount of that cashgenerating unit a cashgenerating unit is the smallest identifiable group 
of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets
in assessing the value in use the estimated future cash flows are calculated by preparing cash flow forecasts derived 
from the most recent financial budgets and an average annual growth rate of 5 over the next five years which does not 
exceed the longterm average growth rate of the relevant markets a terminal value of the cash flow is then calculated 
by assuming growth of 5 discounted using the group’s weighted average cost of capital if the recoverable amount 
of the cash generatingunit is less than the carrying value then an impairment loss is recognised in the statement of 
comprehensive income
software and system development cost
in 2008 the group began a phased rollout of a customer relationship management ‘crm’ system to complement the 
frontoffice system further costs directly attributable to the development of the new systems have been capitalised 
during the year
additions during the year represent the development of a credit risk managment system to improve the early 
identification of risky clients through better reporting and optimising the granting of credit thereby improving the 
visibility and management of trade debtors leading to a reduction in bad debts a legal management and tracking system 
which gives greater visibility and efficiency across the whole dispute resolution process leading to increased recovery 
of disputed debts and an online expenses system to automate the expense claims policy thereby creating back office 
efficiencies and greater overall control sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 73
10 intangible assets continued
recoverable amounts
the recoverable amounts used for impairment testing of intangible fixed assets is based on valueinuse calculations 
using a pretax discount rate based on the group‘s weighted average cost of capital of 95 2009 101 the group has 
used the same discount rate for each cash generating unit as they are all considered to have the same risk profile the 
future cash flow projections are based on approved financial budgets average growth rates used to estimate cash flows 
for the first five years are in line with board approved forecasts with the growth rate assumption thereafter limited to the 
expected growth rate of the local economy
11 investments in subsidiaries
 shares 
 in subsidiaries
company £’000
cost
at 30 november 2008     246715
capital contribution relating to share based payments ifrs 2     936
additions
– repurchase of noncontrolling interest     1349
– disposal of investment     859
at 29 november 2009     248141
capital contribution relating to share based payments ifrs 2     1316
additions
– increase in investments
 i
     6089
– repurchase of noncontrolling interest 
ii     
135
– disposal of investments
 iii
     374
– group reorganisation
 iv
     1397
at 28 november 2010     253910
provision for impairment
at 30 november 2008 and 29 november 2009     9598
– group reorganisation
 iv
     1340
at 28 november 2010     8258
net carrying value
at 28 november 2010     245652
at 29 november 2009     238543
i  the increase in investments relates to the capital requirements of sthree overseas holdings limited
ii  the repurchase of the noncontrolling interest related to huxley banking and finance limited huxley associates 
s limited orgtel contract limited and sthree overseas holdings limited
iii  the investments disposed of during the year related to jobboard enterprises limited huxley banking and finance 
limited huxley associates s limited and progressive france limited
iv the group reorganisation related to the transfer of mg resourcing limited and t actical resourcing limited sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 74
11 investments in subsidiaries continued
in accordance with ias 36 ‘impairment of assets’ the carrying values of the company’s investments in subsidiaries have 
been allocated to their cashgenerating units to assess their value in use in assessing the value in use the estimated 
future cash flows are calculated by preparing cash flow forecasts derived from the most recent financial budget and 
an average annual growth rate of 5 2009 5 discounted using the group’s weighted average cost of capital if the 
recoverable amount of the cash generatingunit is less than the carrying value then an impairment loss is recognised in 
the statement of comprehensive income the pretax discount rate applied to projected future net cash flows to arrive at 
the valuation was 95 2009 101
ifrs 2 requires that any options or awards granted to employees of a subsidiary company will increase the carrying value 
of the investment held in 2010 the group has recognised an increase in the investments in its subsidiaries of £13m 
2009 £09m relating to these share options and awards
group reorganisation
as part of the reorganisation the group undertook a share for share exchange for all noncontrolling interests held there 
was no material effect from the share transfer and no effect on the group cashflow position these subsidiaries were 
subsequently transferred by way of a share exchange to either sthree uk holdings limited or sthree overseas holdings 
limited
in 2010 the movements in the investment relates to the following
    group’s shareholding
    before after
repurchase and disposals of noncontrolling interest    acquisition acquisition
progressive gmbh    780 1000
progessive nederland bv    810 1000
progressive france limited    840 1000
progressive germany limited    800 1000
progressive sas    860 1000
huxley associates finance resourcing inc    745 1000
huxley associates bv    735 1000
huxley associates banking  finance limited    830 1000
huxley associates banking and finance bv    745 1000
huxley associates nederland bv    700 1000
huxley associates m limited    700 1000
huxley associates n limited    700 1000
huxley associates s limited    720 1000 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 75
11 investments in subsidiaries continued
investments comprise the following principal subsidiary trading companies
    shareholding country of
    2010 2009 incorporation principal activity
sthree australia pty limited 100 100 australia recruitment
computer futures solutions nv 100 100 belgium recruitment
huxley associates belgium nv 100 100 belgium recruitment
sthree services nv 100 100 belgium recruitment
sthree belgium nv 100 100 belgium recruitment
sthree sas 100 100 france recruitment
jobboard enterprises gmbh 100 100 germany recruitment
sthree gmbh 100 100 germany recruitment
sthree limited 100 100 hong kong recruitment
sthree india private limited 100 100 india recruitment
sthree staffing ireland limited 100 100 ireland recruitment
jobboard enterprises bv 100 100 netherlands recruitment
sthree holdings bv 100 100 netherlands recruitment
sthree pte ltd 100 100 singapore recruitment
huxley associates banking  finance limited 100 100 uk recruitment
huxley associates global limited 100 100 uk recruitment
huxley associates limited 100 100 uk recruitment
jobboard enterprises limited 90 90 uk recruitment
orgtel contract limited 795 795 uk recruitment
orgtel limited 80 80 uk recruitment
real staffing group limited 100 100 uk recruitment
sthree finance limited

 100 100 uk finance
sthree ip limited

 100 100 uk holding company
sthree management services limited

 100 100 uk management services
sthree overseas holdings limited

 100 100 uk holding company
sthree staffing uk limited 100 100 uk recruitment
sthree uk holdings limited

 100 100 uk holding company
huxley associates finance resourcing inc 100 100 usa recruitment
huxley associates inc 100 100 usa recruitment
specialist staffing solutions inc 100 100 usa recruitment

directly held subsidiaries all other subsidiaries are indirectly held
group reorganisation
during the current year the group further rationalised its structure by undertaking mergers and other legal restructuring 
steps some of which will not formally take effect until into 2011 this followed on from the reorganisation started in 
the prior year where two new holding companies were incorporated namely sthree uk holdings limited and sthree 
overseas holdings limited these holding companies either incorporated or purchased the share capital of a number 
of uk and overseas subsidiaries in a share for share exchange and this had no effect on the net assets of the group 
noncontrolling interests remain in respect of three companies at the year end the aggregate profit and net assets 
attributable to these noncontrolling interest holders has not been separately recognised in the financial statements on 
the basis of materiality
noncontrolling interest rights
in the event of a return of capital in a winding up or capital reduction the noncontrolling interest holding reverts to the 
‘right to dividend’ percentage in any distribution sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 76
12 trade and other receivables
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
current
t rade receivables  64862 60813 3 21
less provision for impairment of trade receivables  1767 2473 – –
net trade receivables  63095 58340 3 21
other receivables  3806 5392 154 2515
prepayments and accrued income  31034 29497 – –
  97935 93229 157 2536
t rade receivables do not carry interest the group makes judgements on an entity by entity basis as to its ability to 
collect outstanding receivables and provides an allowance for doubtful accounts based on a specific review of significant 
outstanding invoices for those invoices not specifically reviewed provisions are provided at differing percentages based 
on the age of the receivable in determining these percentages the group analyses its historical collection experience 
and current economic trends t rade receivable balances are written off when the group determines that it is unlikely that 
future remittances will be received management considers the carrying values of trade and other receivables are equal to 
the fair value and are deemed to be current assets
t rade receivables and cash and cash equivalents are deemed to be all current loan and receivables for disclosure under 
ifrs 7 ‘financial instruments’ – disclosures note 25
  group
    28 november 29 november
    2010 2009
    £’000 £’000
the following table shows the development of allowances on receivables
allowances at start of financial year    2473 2772
charge for the year    686 1968
amounts written down during the year    917 1035
amounts recovered during the year    475 1232
allowances at end of financial year    1767 2473 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 77
13 assets classified as heldtomaturity
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
fixed rate sterling depositeuro bond  3500 3203 – –
at the prior period year end the group invested in a fixed rate euro bond which matured on 6 may 2010 at 28  november 
2010 the group invested in a fixed rate sterling deposit the fixed interest rate on this security is 16 per annum 2009 
14 per annum the bond has a fixed maturity date of 23 may 2011 that is between 3 to 6 months from the end of the 
reporting period the counterparty has a minimum a credit rating none of this asset is past due or impaired
14 current tax assetsliabilities
the current tax liability of £38m 2009 tax asset of £33m for the group and the current tax liability of nil 2009 £05m 
for the company represent current tax recoverablepayable relating to current and prior periods respectively
15 trade and other payables
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
t rade payables  29961 25479 25 86
amounts due to group companies  – – 65634 52451
other taxes and social security  8655 4393 – –
other payables  2039 3032 449 196
accruals  45495 43152 895 461
  86150 76056 67003 53194
all amounts detailed above are payable within one year the fair values of trade and other payables are not materially 
different from those disclosed above
t rade and other payables are predominantly interest free
amounts due to group companies are charged interest at an average rate of 15 2009 175 for sterling denominated 
balances and at 1 above the local base rate for other currencies sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 78
16 financial liabilities
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
bank overdraft  – – 445 –
a flexible invoice financing arrangement has renewed with the royal bank of scotland group rbs until april 2012 under 
this arrangement the group is able to borrow up to £20m funds borrowed under this facility bear interest at the rate of 
175 above the rbs base rate the group has not drawn down any amount on this facility
borrowing levels are subject to maximum of 85 of trade receivables that meets daily sales outstanding target in the 
range of 4050 days
i maturity profile of bank overdrafts
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
within 1 year or on demand  – – 445 –
ii interest rate risk profile of bank overdrafts
the interest rate risk profile of bank overdrafts are as follows
 group company
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
floating rate  overdraft  – – 445 –
the group has a cash pooling arrangement which allows netting off the overdraft balances to mitigate finance costs sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 79
17 provisions for liabilities and charges
 corporate and divisional
 restructuring property other total
  £’000 £’000 £’000 £’000
at 30 november 2008  – 1288 2579 3867
utilised during the year  6974 223 – 7197
chargedreleased to the statement of comprehensive income  9050 539 307 9282
at 29 november 2009  2076 1604 2272 5952
utilised during the year  1565 100 – 1665
chargedreleased to the statement of comprehensive income  – 251 1827 2078
t racker share consideration  – – 3382 3382
t ransfer  511 511 – –
at 28 november 2010  – 1764 3827 5591
    28 november 29 november
    2010 2009
currentnoncurrent analysis    £’000 £’000
current liabilities    4237 3063
noncurrent liabilities    1354 2889
    5591 5952
provisions are not discounted as the group believes that the effect of the time value of money is immaterial and the 
amount of provisions measured at cost approximate to the present value of the expenditure required to settle the 
obligation
corporate and divisional restructuring
on 15 april 2009 the group announced a number of changes relating to corporate and divisional restructuring the group 
has charged the restructuring cost incurred of £91m at 29 november 2009 to the statement of comprehensive income 
in the previous period the transfer to ”property” provision represents the residual amount of £05m relating to property 
rationalisation costs
property
dilapidations — the group is obliged to pay for dilapidations at the end of its tenancy of various properties provision has 
been made based on independent professional estimates of the likely costs based on current conditions and these have 
been spread over the relevant lease term the liability is expected to crystallise as follows
    28 november 29 november
    2010 2009
    £’000 £’000
within one year    410 683
one to five years    903 782
after five years    451 139
    1764 1604 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 80
17 provisions for liabilities and charges continued
other
other provisions released to the statement of comprehensive income in the current year principally included amounts in 
respect of liabilities resulting from indemnities given to group clients in continental europe arising in the normal course of 
business in respect of the employment status of contractors a detailed review of the group’s improved internal controls 
and procedures surrounding this area as well as a history of not receiving any legal claims since the provision was 
created in 2004 resulted in the decision that the provision was no longer required
other remaining provisions relate to the obligation to repay amounts received or receivable in relation to the subscription of 
tracker shares offered to certain employees under the terms of the tracker share arrangements and ongoing legal matters
18 deferred tax assetsliabilities
  european
 excess tax contractor sharebased
 depreciation liabilities payments other total
group £’000 £’000 £’000 £’000 £’000
at 30 november 2008 371 667 812 1296 3146
creditcharge to statement of comprehensive  
income for the year 601 82 394 2915 3828
prior year chargecredit to statement of  
comprehensive income for the year 2314 33 – 202 2079
charge to equity for the year – – 620 – 620
at 29 november 2009 1342 618 1826 4413 5515
creditcharge to statement of comprehensive  
income for the year 85 618 48 4358 3873
prior year chargecredit to statement of  
comprehensive income for the year 49 – – 943 992
charge to equity for the year  – 258 – 258
exchange difference – – – 16 16
at 28 november 2010 1306 – 2132 7844 8670
the group believes that the deferred tax assets will be recoverable against projected taxable profits over the foreseeable 
future in the companies to which they relate
the group has tax losses of £245m for the year 2009 £112m in respect of overseas territories a deferred tax asset in 
respect of these losses has been recognised on consolidation
the finance no 2 act 2010 included legislation to reduce the main rate of uk corporation tax from 28 to 27 with effect 
from 1 april 2011 the legislation was substantially enacted in july 2010 and as a result the group’s deferred tax asset 
has been reduced as at 28 november 2010 by £32112 resulting in a charge to the statement of comprehensive income of 
£41652 and a credit to equity of £9540
unremitted earnings
as at 28 november 2010 unremitted earnings of overseas group companies amounted to £208m 2009 £355m 
unremitted earnings may be liable to some overseas tax and uk tax after allowing for double taxation relief if they were 
to be distributed as dividends however no tax is expected to be payable on them because as at the end of the reporting 
period there are no plans to remit these earnings therefore no provision for tax in respect of possible future remittances 
has been made sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 81
18 deferred tax assetsliabilities continued
   sharebased 
   payments other total
company   £’000 £’000 £’000
at 30 november 2008   38 264 226
chargecredit to statement of comprehensive income for the year  433 264 169
charge to equity for the year   762 – 762
at 29 november 2009   1157 – 1157
charge to statement of comprehensive income for the year   27 – 27
charge to equity for the year   116 – 116
at 28 november 2010   1300 – 1300
19 share capital
a share capital
   28 november  29 november
   2010  2009
  number of  number of
authorised  shares £’000 shares £’000
ordinary shares of 1p each  300000000 3000 300000000 3000
   capital
  ordinary redemption capital
  shares reserve reserve total
allotted and fully paid number £’000 £’000 £’000 £’000
at 29 november 2009 121756276 1218 168 878 2264
issue of share capital 3303 – – – –
at 28 november 2010 121759579 1218 168 878 2264
share issue
share options that were granted in november 2000 were satisfied in the current period with a new issue of 3303 2009 
29500 ordinary shares sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 82
19 share capital continued
b share options
certain employees hold options to subscribe for ordinary shares in the company under the share option schemes 
the number of shares subject to options the period in which they were granted and the period in which they may be 
exercised are given below during this financial year 337127 2009 88265 of these options were exercised of which 
3303 2009 29500 were satisfied by the issue of new ordinary shares and the remaining 333824 2009 59265 were 
satisfied by the shares held in the ebt
  number    number
  of options    of options
  outstanding    outstanding exercise
  29 november granted exercised lapsed 28 november price exercise
year of grant note 2009 in year in year in year 2010 per share period
2000 a 3000 – 3000 – – 1p 20002010

2007 b 345332 – 173480 171852 – – 20102017
2008 c 1039095 – 55894 31685 951516 – 20112018
2009 d 1625583 – 90638 30016 1504929 – 20122019
       £1  2722p   
2010 e – 1287035 14115 10020 1262900 2994p

 20132020
  3013010 1287035 337127 243573 3719345  

  the exercise price relates to approved options 276979 options at 2994p per share 11021 options at 2722p per share and funding shares 
288000 options at £1 under the relevant scheme
note
a  3000 share options became exercisable and were all exercised during the year
longterm incentive plan ltip
  in november 2006 shareholders approved a sharebased l tip  in february 2010 awards for all l tip participants were 
structured to include tax approved options with funding awards also being granted at an option price of £1 in respect 
of the total award
  on 19 october 2010 the company introduced a joint ownership plan ‘jop’ in respect of the unapproved l tip awards 
made in february 2010 jop options over existing l tip awards were granted to participants at 60p per share the main 
features of the l tip are detailed within the directors’ remuneration report
b  the weighted average fair value of the equitysettled share awards granted in 2007 amounted to 22664p per 
award the fair value of the share awards was calculated using the montecarlo simulation model the montecarlo 
simulation model reflected the historical volatilities of the company’s share price and those other companies to which 
the company’s performance is compared over a period equal to the vesting period the average share price on the 
date of grant was 4020p the vesting period in which performance of the tsr is assessed is 3 years
c  the weighted average fair value of the equitysettled share awards granted in 2008 amounted to 11742p per award 
the average share price on the date of grant was 19675p the vesting period in which performance of the tsr is 
assessed is 3 years
d  the weighted average fair value of the equitysettled share awards granted during 2009 amounted to 11099p per 
award the average share price on the date of grant was 1700p the vesting period in which performance of the tsr is 
assessed is 3 years sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 83
19 share capital continued
b share options continued
longterm incentive plan ltip continued
e  the weighted average fair value of the equitysettled share awards granted during the year amounted to 26150p per 
award the average share price on the date of grant was 3100p the vesting period in which performance of the tsr is 
assessed is 3 years
other employees share option schemes
   saye sip total
   £’000 £’000 £’000
at 29 november 2009   59 58 117
granted   37 148 185
lapsed   – 2 2
at 28 november 2010   96 204 300
save as you earn saye
the saye share option scheme was approved by the shareholders on 24 april 2009 in order to promote share ownership 
amongst all uk employees of the company linking employee benefit to company performance and to aid staff retention 
all uk employees and executive directors who have continuous service of more than six months ending on the date of 
grant or such shorter period as the board may decide within the group are eligible to participate in the scheme the 
board has discretion to reduce the period of qualifying service and to invite other employees to participate under the 
saye employees can save up to £250 per month for three years and receive options to purchase the company’s shares at 
a discount of up to 20 on the market value during 2010 129 employees 2009 233 employees applied to participate in 
the saye options awarded under the saye scheme are not subject to any performance conditions
for the purpose of valuing options to arrive at the sharebased payment charge the black scholes option pricing model 
has been used for schemes with total shareholder return performance targets the assumptions used in the models are 
as follows
weighted average fair value £ 14847p
key assumptions used
weighted average share price 29600p
exercise prices £ 18900p
range of expected volatility 45
riskfree interest rate 322
range of expected option term life 3 years
dividend yield 606
share incentive plan sip
the sip was approved by shareholders on 24 april 2009 under the sip  employees are invited to make contributions to 
buy partnership shares if an employee agrees to buy partnership shares the company currently matches the number of 
partnership shares bought with an award of matching shares on a oneforone basis
assumptions on expected volatility and expected option term have been made on the basis of historical data wherever 
available for the period corresponding with the vesting period of the option best estimates have been used where 
historical data is not available in this respect sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 84
19 share capital continued
b share options continued
share incentive plan sip continued
during the year the group recognised a cost of £02m 2009 £006m related to equitysettled sharebased payment 
transactions the weighted average price paid for plan shares during the year was 30285p 2009 25380p
employee benefit trusts ebt
in addition to the share options set out above the company has issued further share options and awards which will be 
satisfied by shares held by the group’s ebt the shares held by the ebt are shown as a deduction from shareholders’ 
funds
the ebt waive their rights to receive a dividend under the terms of the trusts no other shareholder waives their rights to 
dividends
ordinary shares     number
29 november 2009   2250988
movement in the year l tip options exercised  333824
 optionsawards exercised  55037
28 november 2010   1862127
the shares held in the trust include shares gifted from the directors at nil cost to the ebt and shares newly issued to 
satisfy awards under the share option schemes and l tip 
options granted and awards to be settled by shares held in the ebt are as follows
  number of    number of    
  optionsawards    optionsawards    
  outstanding granted   outstanding  exercise  
year of  29 november awards exercised lapsed 28 november  price exercise
grantaward note 2009 in year in year in year 2010 per share period
2004 a 12000 – 12000 – – 1p 20042014

2004 b 4800 – 4800 – – 1p 20042014

2004 c 1174718 – 10237 113081 1051400 1p 20042014

2005 d 1700 – – – 1700 £1 total 20052015

2008 e 34000 – 28000 6000 – – 20082018
  1227218 – 55037 119081 1053100

 providing certain conditions have been met at the time of exercise
the weighted average market share price for shares exercised during the year was 295p 2009 203p sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 85
19 share capital continued
b share options continued
employee benefit trusts ebt continued
approved executive share option scheme
a  on 28 may 2004 options over 650720 ordinary shares were issued at an exercise price of 1p these options replaced 
options that had lapsed in the previous grant of options in 2000 there are no performance conditions attached and 
the options are exercisable within 10 years from the date of grant the number of options outstanding at 28 november 
2010 was nil 2009 12000
b  on 3 december 2004 options over 49600 ordinary shares were issued at an exercise price of 1p these options 
replaced options that had lapsed in the previous grants of options in november 2000 and may 2004 there are no 
performance conditions attached and the share options are exercisable within 10 years from the date of grant the 
number of options outstanding at 28 november 2010 was nil 2009 4800
c  options over 525 million ordinary shares were granted by the board to certain employees on 3 december 2004 these 
are exercisable within 10 years from the date of grant these options are subject to a performance condition requiring 
that over a five year period a certain level of profits has to be achieved if these performance targets are achieved in 
each of the relevant periods a total of 1050000 options are available for allocation in each year following the target 
being achieved the number of options outstanding at 28 november 2010 was 1051400 2009 1174718
unapproved share option scheme
d  at ipo 16 november 2005 the board awarded 433749 ordinary shares and issued 505710 share options to certain 
current and former employees who were considered to have contributed to the group’s continued success the share 
options are exercisable immediately upon grant and expire 10 years from the date of grant the number of options 
outstanding at 28 november 2010 was 1700 2009 1700 the group recognised a charge in the income statement for 
the year ended 30 november 2005 in accordance with ifrs 2 amounting to £1878918 representing the fair value of 
the options awarded at the date of grant there have been no awards in the current year
e  on 15 october 2008 the directors made share awards over 226 700 ordinary shares to certain current employees who 
were considered to have contributed to the group’s continued success the share awards vest either immediately or 
after two years for the calculation of the charge the fair value of these share awards is based on the midprice on the 
day that the award was granted to the employees the number outstanding at the year end was nil 2009 34000 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 86
19 share capital continued
c share awards in subsidiary companies previously ‘minority interests’
as described in the directors’ report the group makes awards of shares in subsidiary businesses to certain 
entrepreneurial employees who will participate in the development of those businesses
these awards generally have the following characteristics
–  an employee receives an award of a ‘’tracker share’’ in a subsidiary business this share gives the employee certain 
rights to income and capital growth of a ‘’tracked’’ business
–  the employee must subscribe for his award of tracker shares at fair value as determined by an independent third party 
share valuer and taking into account the particular rights attached to the shares described in the relevant businesses’ 
articles of association
–  if the employee remains in employment with the group for a preagreed period not less than three years he may 
then offer his tracker shares for sale to sthree plc should sthree plc decide to buy back the tracker shares it will do 
so at a price based on a multiple of the tracker shares’ fair value at that date and sthree plc may choose to settle this 
transaction in cash or in sthree plc shares as it chooses
–  if the employee leaves the group before the preagreed period being three or five years depending on the life of the 
tracker he is entitled to receive the lower of the initial subscription he paid or the fair value on the date of his departure 
as calculated by a third party valuer
during the prior year the following awards have been made under the tracker share arrangements
 number of awards   number of awards
 outstanding number of awards number of awards outstanding
 30 november created during the bought back 29 november
 2008 year during the year 2009
t racker share awards made – 2009 941 619 94 1466
 number of awards   number of awards
 outstanding number of awards number of awards outstanding
 30 november created during the bought back 28 november
 2009 year during the year 2010
t racker share awards made – 2010 1466 22313

 105 23674


 20207 of this total was transferred from the non controlling interests into sthree uk holdings ltd and sthree overseas holdings ltd in july 2010
as employees must subscribe for the awards at fair value there is no ifrs2 charge the total net subscription proceeds 
received for 2010 tracker share awards was £435000 2009 £192000 with proceeds in respect of individual awards 
ranging from £28271 to £4884973 2009 £33700 to £1745274 the group also bought back 105 tracker shares during 
the year for a total consideration of £33719 2009 £10000
the subscription price of the tracker share awards is determined by an independent valuer taking into account the 
expected performance of each tracked business and the likelihood of ultimate buyback by sthree plc sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 87
20 results of holding company
of the results for the financial year a retained profit of £49m 2009 retained profit of £287m was recorded the 
directors have taken advantage of the exemption available under section 408 of the companies act 2006 and do not 
present a statement of comprehensive income for the company alone
21 commitments
group
operating leases
at the end of the reporting period the group had annual commitments under noncancellable operating leases as set out 
below
    motor vehicles  land and buildings
  28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
t otal minimum operating lease payments due
within one year  408 1244 10218 11459
one to five years  2 400 28598 35191
after 5 years  – – 11544 13083
  410 1644 50360 59733
capital commitments
the group had contractual commitments of £02m 2009 £05m relating to property plant and equipment at the end of 
the reporting period
vat group registration
as a result of the group registration for vat purposes the company is contingently liable for vat liabilities arising in other 
companies within the vat group the total vat liability as at 28 november 2010 amounted to £47m 2009 £18m
guarantees
the group issued bank guarantees for commitments which amounted to £18m 2009 £21m
company 
the company held no outstanding lease or capital commitments at the year end 2009 nil sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 88
22 cash and cash equivalents
 group company
    28 november 29 november 28 november 29 november
  2010 2009 2010 2009
  £’000 £’000 £’000 £’000
cash in hand and at bank  51718 45272 – 150
bank overdraft note 16  – – 445 –
  51718 45272 445 150
due to the group pooling arrangement an overdraft amount of £04m 2009 £nil in sthree plc is netted out against cash 
balance in group companies
included within cash and cash equivalents is £08m 2009 £04m against which the group has issued cash collaterised 
bank guarantees this amount is not immediately available for use in the business
23 related party transactions
group 
the group has related party relationships with its subsidiaries note 11 with its directors and with members of the 
executive board details of transactions between the group and other related parties are disclosed below
key management personnel
the key management under ias 24 ‘related party disclosure’ is defined as those persons who have authority and 
responsibility for planning directing and controlling the entity’s activities directly or indirectly the group’s key 
management comprises of the executive directors nonexecutive directors executive committee and other key 
managers who are deemed to influence the day to day activities details of directors’ remuneration are given in the 
directors’ remuneration report the remuneration of the directors is determined by the sthree plc remuneration 
committee in accordance with its stated policy t otal remuneration for members of key management is detailed below
    28 november 29 november
    2010 2009
    £’000 £’000
salaries and other shortterm benefits    4124 3255
fair value of share awards granted    1271 810
postemployment benefits    196 156
t ermination benefits    – 448
    5591 4669
the above figures for 2009 include £259000 which was recognised in the corporate and divisional restructuring 
exceptional items sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 89
23 related party transactions continued
company 
the company has related party relationships with its subsidiaries note 11 and with members of the executive board 
the directors receive remuneration from the company which is disclosed in the directors’ remuneration report the 
company did not have any transactions other than those disclosed in the remuneration report with the directors during 
the financial year details of transactions between the company and other related parties are disclosed below
    28 november 29 november
    2010 2009
    £’000 £’000
loans and advances given to and dividends received from subsidiaries
loans and advances given to subsidiaries    – 11340
loans and advances given to directors    305 305
interest income received in respect of interest bearing loans and advances   70 162
dividend income received    13201 25745
loans and advances received from subsidiaries
loans and advances received from subsidiaries    13183 –
interest expense paid in respect of interest bearing loans and advances   976 1674
year end balances arising from transactions with subsidiaries
    28 november 29 november
    2010 2009
    £’000 £’000
amounts payable to subsidiary companies    65634 52451
24 subsequent events
the group does not have any events post the end of the reporting period that require disclosure as at 28 january 2011 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 90
25 financial instruments and financial risk factors
financial risk factors 
the group reports in sterling and pays dividends out of sterling profits the role of corporate t reasury is to manage 
and monitor external and internal funding requirements and financial risks in support of corporate objectives t reasury 
activities are governed by policies and procedures approved by the board of directors t reasury management chaired 
by our chief financial officer meets on a monthly basis to review t reasury activities its members receive management 
information relating to t reasury activities our internal auditors regularly review the t reasury internal control 
environment
in previous years the group t reasury entered into a small number of derivative transactions principally currency swaps 
and forward currency contracts with the purpose to manage the currency risks arising from operations and financing 
the board undertook a review of its currency hedging strategy to ensure it is appropriate and currently does not actively 
manage its exposure to foreign exchange risk by the use of financial instruments the group does not hold or issue 
derivative financial instruments for speculative purposes and our t reasury policies specifically prohibit such activity all 
transactions in financial instruments are undertaken to manage the risks arising from underlying business activities not 
for speculation
the t reasury function is managed as a cost centre and thus not engaged in speculative trading
the group is exposed to a number of different financial risks including foreign currency exchange rates liquidity interest 
rates and credit risk the group’s objective and strategy in responding to these risks is set out below
a capital risk management
  the group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern 
in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital 
structure to reduce the cost of capital
  in order to maintain or adjust the capital structure the group may adjust the amount of dividends paid to 
shareholders return capital to shareholders issue new shares or sell assets to reduce debt
  consistent with others in the industry the group monitors capital on the basis of the gearing ratio this ratio is 
calculated as net debt divided by total capital net debt is calculated as total borrowings including ‘current and 
noncurrent borrowings’ as shown in the consolidated statement of financial position less cash and cash equivalents 
t otal capital is calculated as ‘equity’ as shown in the consolidated statement of financial position plus net debt
b foreign currency exchange risk
  the group publishes its consolidated financial statements in sterling and conducts business in a number of other 
currencies principally the euro consequently the group is exposed to foreign exchange risk due to exchange rate 
movements which affect the group‘s transactional revenues cost of sales the translation of the earnings and net 
assets of its overseas operations
  the group is also exposed to foreign currency exchange risk from the value of net investments outside the united 
kingdom the settlement of intercompany balances held with foreign operations is neither planned nor likely to occur 
in the foreseeable future therefore exchange differences arising from the translation of the net investments are 
taken into equity
  the group’s businesses generally raise invoices and incur expenses in their local currencies local currency cash 
generated is remitted via intercompany transfers to the united kingdom the group generally converts foreign 
currency balances into sterling to manage its cash flows
  the anticipated impact on the group‘s results if the euro strengthened against sterling by a movement of more 
than 10 in terms of translational exposure amounts to an increase in profit before tax by £28m 2009 £31m if 
the euro weakened against sterling by more than 10 this would result in a decrease in profit before tax of £28m 
2009 £31m sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 91
25 financial instruments and financial risk factors continued
b foreign currency exchange risk continued
  the table below provides exchange rates used by the group for translation of the earnings and net assets of its 
overseas operations
    weighted average rate   closing rate
  2010 2009 2010 2009
  £ £ £ £
euro  08691 08977 08499 09087
us dollar  06458 06530 06417 06061
hong kong dollar  00832 00843 00827 00782
australian dollar  05852 04924 06193 05496
singapore dollar  04695 04448 04865 04368
c liquidity risk
  the group actively maintains committed facilities to enable it to finance its daytoday operations based on cash 
flow projections the group invests surplus cash in interestearning deposit accounts or bonds with uk and european 
banks note 13 and complies with all its covenants
  the group’s treasury function centrally coordinates relationships with banks borrowing requirements foreign 
exchange requirements and cash management the group believes it has access to sufficient funding through an 
invoice financing arrangement that provides a committed borrowing facility of £20m and expires in april 2012
  the table below shows the maturity profile of the group’s financial liabilities based on the contractual amounts 
payable on the date of repayment
 trade and other payables financial liabilities
 group company group company
at 28 november 2010  £’000 £’000 £’000 £’000
within one year  77495 67003 – 445
at 29 november 2009
within one year  71663 53194 – – sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 92
25 financial instruments and financial risk factors continued
d interest rate risk
  the group is also exposed to interest rate risk from the possibility that changes in interest rates will affect future cash 
flows or the fair values of its financial instruments principally financial liabilities the group finances its operations 
through a mixture of retained profit the invoice discounting facility and when required bank overdrafts
  the group does not hedge the exposure to variations in interest rates presented by the above instruments
  t aking into consideration all variable rate borrowings and cash in place as at 28 november 2010  if the interest rate 
payable or receivable moved by a 100 basis points in either direction then the effect to the group would be minimal
e credit risk
  in the normal course of business the group participates in cash pooling arrangements with its counterparty bank the 
maximum exposure with a single bank for deposits is £30m 2009 £452m
  t rade and other receivables of the group are analysed in the table below with respect to the trade and other 
receivables that are neither impaired nor past due there are no indications as of the reporting date that the debtors 
will not meet their payment obligations
  the group mitigates its credit risk by using a credit rating agency to assess new clients and payment history to assess 
further credit extensions to existing clients in addition the spread of sme client base circa 7000 clients helps to 
mitigate the risk of individual client failure having a material impact on the group
  the group does not typically renegotiate the terms of trade receivables hence the outstanding balance is included 
in the analysis based on the original payment terms there were no significant renegotiated balances outstanding at 
year end
  group  company
  2010 2009 2010 2009
trade and other receivables  £’000 £’000 £’000 £’000
neither impaired nor past due  71708 70417 157 2536
impaired net of valuation allowance  1336 392 – –
not impaired and past due in the following periods
within 30 days  19859 17599 – –
31 to 60 days  4211 3894 – –
61 to 90 days  821 927 – –
total  97935 93229 157 2536 sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 93
25 financial instruments and financial risk factors continued
f interest rate profile of financial assetsliabilities
  the following tables set out the exposure of financial assets and liabilities to either fixed interest rates floating interest 
rates or no interest rates the maturity profile of financial assets and liabilities exposed to interest rate risk in the table 
below indicates the contractual repricing and maturity dates of these interest rates
 financial assetsliabilities
 group company
    cash heldto cash 
    and cash  maturity and cash   financial
    equivalents investments equivalents investments liabilities
at 28 november 2010  £’000 £’000 £’000 £’000 £’000
less than one year  51718 3500 – – 445
total interestbearing  51718 3500 – – 445
analysed as
floating rate  51718 – – – 445
fixed rate  – 3500 – – –
t otal interestbearing  51718 3500 – – 445
noninterestbearing  – – – 245404 –
t otal   51718 3500 – 245404 445
at 29 november 2009  £’000 £’000 £’000 £’000 £’000
less than one year  45272 3203 150 – –
total interestbearing  45272 3203 150 – –
analysed as
floating rate  45272 – 150 – –
fixed rate  – 3203 – – –
t otal interestbearing  45272 3203 150 – –
noninterestbearing  – – – 238543 –
total   45272 3203 150 238543 –
g price risk
  as part of the presentation of the market risks ifrs 7 requires disclosure on how hypothetical changes in risk 
variables affect the price of financial instruments important risk variables are stock exchange prices or indices as of 
28 november 2010 the entity did not hold any material investments to be classified as ‘available for sale’ or as ‘held for 
trading’ therefore there are no financial instruments which would be materially impacted by risk variables affecting 
the price of financial instruments sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 94
25 financial instruments and financial risk factors continued
h currency profile of financial assetsliabilities
functional currency of group operations
 net foreign currency monetary assets
    other
 sterling euro us dollars currencies total
at 28 november 2010 £’000 £’000 £’000 £’000 £’000
sterling – 1644 221 920 2785
euro – – – – –
other – – 184 – 184
total – 1644 405 920 2969
 
at 29 november 2009 £’000 £’000 £’000 £’000 £’000
sterling – 9865 518 1063 11446
euro 10 – – – 10
other – – 248 – 248
total 10 9865 766 1063 11704
the company does not have any exposure to other currencies other than its functional currency of sterling
other foreign currencies held by the group include the following swiss francs united arab emirates dirhams australian 
dollars hong kong dollars singapore dollars swedish kronor bahrain dinars kuwait dinars qatar riyals saudi arabia 
riyals and indian rupees sthree plc
notes to the financial statements
year ended 28 november 2010
sthree plc 5 95
25 financial instruments and financial risk factors continued
i fair values of financial assets and liabilities
 the carrying amounts of financial assets and financial liabilities are equal to their fair values
  fair value is the amount at which a financial instrument could be exchanged in an arm’s length transaction between 
informed and willing parties other than a forced or liquidation sale and excludes accrued interest
  where available market values have been used to determine fair values where market values are not available fair 
values have been calculated by discounting expected cash flows at prevailing interest rates and by applying year end 
exchange rates a summary of the assumptions used for each category of financial instrument is set out below
 summary of methods and assumptions
shortterm deposits and borrowings  approximates to the carrying amount because of the short 
maturity of these instruments
cash and cash equivalents approximates to the carrying amount
receivables and payables  approximates to the carrying amount for current balances there 
are no material longer term balances
financial instruments market valuations at the end of the reporting period
26 contingent liabilities
the group has contingent liabilities in respect of legal claims arising in the ordinary course of business they are not 
anticipated to result in a material cash outflow for the group sthree plc 5 96
sthree plc
five year financial summary
 28 november 29 november 30 november 2 december 30 november
 2010 2009 2008 2007 2006
 £’m £’m £’m £’m £’m
turnover
geographic analysis
– by location of client
united kingdom 2243 2713 3869 3697 2957
europe and rest of world 2502 2481 2446 1530 976
 4745 5194 6315 5227 3933
gross profit
geographic analysis
– by location of client
united kingdom 668 769 1216 1233 989
europe and rest of world 996 943 973 594 366
 1664 1712 2189 1827 1355
operating profit
before exceptional items 212 180 568 523 410
other key performance indicators
 numbers numbers numbers numbers numbers
average headcount 1772 1841 2157 1786 1288
permanent placements in financial year 6551 6060 10236 9568 7685
active contractors at year end 4359 4157 5745 5662 4719
 £ £ £ £ £
average placement fee — permanent 12123 11930 10355 9780 8563
average gross profit per day — contractors 8424 8469 7830 7142 6490 sthree plc 5 97
sthree plc
notes shareholder information
shareholder enquiries and electronic 
communications – wwwcapitashareportalcom
shareholders with enquiries relating to their shareholding 
should contact capita registrars alternatively you may 
access your account via wwwcapitashareportalcom but will 
need to have your shareholder reference available when you 
first log in which may be found on your dividend voucher 
share certificate or form of proxy the online facility also allows 
shareholders to view their holding details find out how to 
register a change of name or what to do if a share certificate 
is lost as well as download forms in respect of changes of 
address dividend mandates and share transfers
shareholders who would prefer to view documentation 
electronically can elect to receive automatic notification by 
email each time the company distributes documents instead 
of receiving a paper version of such documents by registering 
a request via the registrar by calling 0871 664 0391 from uk 
– calls cost 10p per min plus network extras lines are open 
830am – 530pm mon to fri or  44 208 639 3367 non uk or 
register online at 
wwwcapitashareportal
there is no fee for using this service and you will automatically 
receive confirmation that a request has been registered 
should you wish to change your mind or request a paper 
version of any document in the future you may do so by 
contacting the registrar
potential targeting of shareholders
companies have become aware that their shareholders have 
received unsolicited phone calls or correspondence concerning 
investment matters these are typically from overseas based 
brokers’ who target uk shareholders offering to sell them 
what often turn out to be worthless or high risk shares in us 
or uk investments they can be very persistent and extremely 
persuasive and a 2006 survey by the financial services 
authority fsa has reported that the average amount lost by 
investors is around £20000 it is not just the novice investor 
that has been duped in this way many of the victims had been 
successfully investing for several years shareholders are 
advised to be very wary of any unsolicited advice offers to buy 
shares at a discount or offers of free company reports
if you receive any unsolicited investment advice
make sure you get the correct name of the person and • 
organisation
check that they are properly authorised by the fsa • 
before getting involved you can check at  
wwwfsagovukregister
the fsa also maintains on its website a list of • 
unauthorised overseas firms who are targeting or 
have targeted uk investors and any approach from 
such organisations should be reported to the fsa 
so that this list can be kept up to date and any other 
appropriate action can be considered if you deal with an 
unauthorised firm you would not be eligible to receive 
payment under the financial services compensation 
scheme the fsa can be contacted by completing an 
online form at wwwfsagovukpagesdoingregulated 
lawalertsoverseasshtml
inform the registrar as shown above • 
details of share dealing facilities that the company endorses 
will only be included in publications issued by the company 
more detailed information on this or similar activity can be 
found on the fsa website wwwfsagovukconsumer
adr information
for us investors the company has set up a level one adr 
facility under the ticker symbol ‘serty’ bny mellon acts 
as both adr depositary bank  registrar for this facility 
for further information please visit the website www
adrbnymelloncom and search for the sthree profile page 
holders can also access information by the following
bny mellon shareowner services
po box 358016
pittsburgh pa 152528016
customer service t el 1 800 5226645 from outside the us 
t el 001 201 6806578
email shrrelationsmelloncom
for the issuance of adrs please contact  
michael ludwig
t el 1 212 815 2213
fax 1 212 571 3050
email mludwigbankofnycom
website httpwwwadrbnymelloncom
share price information
information on the company’s share price can be found via 
wwwsthreecom or via the ft cityline service tel 0906 003 
0000 code 3912 calls cost 60p per minute from a bt landline 
and charges from other telephone networks may vary
share dealing service
capita share dealing services provide a telephone and online 
share dealing service for uk and eea resident shareholders t o 
use this service shareholders should contact capita tel 0871 
664 0454 – lines are open mon to fri 800am – 430pm uk time 
calls cost 10p per min plus network extras alternatively log 
on to wwwcapitadealcom
capita share dealing services is a trading name of capita irg 
t rustees limited which is authorised and regulated by the fsa
dividend reinvestment plan drip 
non sponsored
for any shareholders who wish to reinvest dividend 
payments in additional shares of the company a facility  
is provided by capita irg t rustees ltd in conjunction  
with capita registrars under this facility accrued  
dividends are used to purchase additional shares any 
shareholder requiring further information should contact 
capita on uk 0871 664 0381 or nonuk 44 208 639 3402 
or email sharescapitaregistrarscom
calls cost 10p per minute plus network extras lines are open 
830am – 530pm mon to fri
sharegift
sharegift reg charity no 1052686 operates a charity share 
donation scheme for shareholders with small parcels of shares 
whose value may make it uneconomic to sell details of the 
scheme are available from
website wwwsharegiftorg 
t el 0207 930 3737
financial calendar 201011
financial year end – 28 november 2010
results announced – 31 january 2011
annual general meeting – 21 april 2011
exdiv date for final dividend – 4 may 2011
record date for final dividend – 6 may 2011
dividend reinvestment latest – 12 may 2011
half year period end – 29 may 2011
final dividend payable – 6 june 2011
interim results announced – 18 july 2011 
interim dividend payable – early december 2011 


Summary:
 sthree plc 6
overview
2010 saw a substantially improved 
market when compared to 
the exceptionally challenging 
environment of 2009 that said it 
would be misleading to suggest that 
the overall level of demand for our 
services during 2010 was universally 
consistent with a fully recovered 
marketplace whilst some parts of our 
business equalled or surpassed pre
downturn levels of performance and 
all our markets were in growth by the 
last quarter most were yet to return to 
the very buoyant conditions that we 
would associate with “normality” in 
the specialist staffing market
given this specific context it is 
pleasing to report a strong 2010 
performance the group delivered a 
substantial improvement in overall 
profitability and a further increase in 
our cash balances whilst at the same 
time continuing to invest in the future 
of the business
in addition to increasing sales 
headcount substantially we also 
opened a further six offices bringing 
the overall total to 52 of which 30 
are outside the uk given this strong 
trading platform coupled with steadily 
improving market conditions we 
believe we are in an excellent position 
to make 2011 another year of progress 
on this basis the group intends to 
further grow sales headcount and 
continue the international office roll 
out throughout 2011
financial outcome
during the year the group saw a 
modest reduction in gross profit gp 
with the 2010 figure of £1664m down 
28 2009 £1712m largely due to 
the relative weakness of the contract 
marketplace during most of the year 
however this converted to a profit 
before t ax pbt of £216m up some 
20 before prior year exceptional 
items 2009 £180m reflecting a 
continued tight control of costs
notwithstanding the fact that 2010 
was a year of investment the group 
had another strong performance 
in terms of cash generation at the 
end of 2010 net cash including term 
investments had increased to £552m 
2009 £485m
the strong cash performance 
combined with steadily improving 
market conditions support the 
board’s decision to maintain the total 
2010 dividend at 120p 2009 120p 
which is comfortably underpinned by 
the cash available to the group
geographical expansion
the group continued its well 
established strategy of geographical 
expansion opening six international 
offices in the year in addition 
to further offices in munich and 
düsseldorf we rolled out offices 
in perth delhi houston and san 
francisco bringing the overall total  
to 52 offices in 12 countries
in aggregate group gp generated 
from outside of the uk was £995m 
2009 £942m up 56 given the 
more mature nature of the uk staffing 
market and in particular the continued 
relatively subdued demand for 
contract staff uk gp of £668m  
was down 131 on the prior year 
2009 £769m
as a consequence of this difference 
in relative performance the overall 
non ukuk business mix underwent 
a marked change for 2010 the ratio 
was 6040 in favour of non uk gp 
compared with 5545 in 2009 it is 
likely that this shift will represent an 
ongoing trend as the group becomes 
ever more international however 
the fact remains that the uk has 
consistently demonstrated very 
robust growth in more typical market 
conditions and we are confident that 
the uk will show a significant bounce 
back as confidence levels build
there is now ample evidence to 
indicate a rapidly growing opportunity 
to take the proven sthree model into 
an ever wider range of international 
markets most of which are 
substantially less mature than the 
uk in the first half of 2011 we expect 
to open offices in doha sao paulo 
abu dhabi and antwerp and it is likely 
that the total number of new offices 
opened during 2011 will be similar to 
the six that came on stream each  
year during 2010 and 2009 that 
being said during 2011 we expect the 
large majority of our new hires to  
be into established sthree locations 
thereby derisking the expansion 
programme
sector diversification
in parallel with its greater 
geographical diversity in recent 
years the group has made significant 
progress in developing markets 
outside of its historic ict franchise 
the ict market has attractive 
characteristics not least of all in 
terms of highly paid candidates 
and a structural skills shortage 
in most technical areas albeit in 
some territories the ict market is 
particularly competitive
over a period of years the group 
has demonstrated its expertise in 
moving into adjacent specialist 
staffing sectors many of which are 
both substantially less competitive 
than the ict market and are also 
characterised by candidates who can 
command rates which are at least 
equal to and in many cases above 
those achieved in ict
chief executive officer’s review 
for the year ended 28 november 2010 sthree plc 7
the result of this sectoral 
diversification is that non ict 
franchises accounted for 383 of 
total gp  this figure of £638m was 
up 315 on the previous year 2009 
£485m the major non ict segments 
for the group are banking engineering 
 energy accountancy  finance 
and pharmaceuticals the group also 
has a relatively modest presence in 
each of hr and sales  marketing
the ict franchise performed 
somewhat less robustly than the 
other sectors with 2010 gp of 
£1026m 2009 £1226m down 
163 on the prior year the group’s 
ict performance was impacted by 
a number of factors the relatively 
subdued contract market which is 
disproportionately ict based the 
decline in public sector hiring – 
another ict biased market and the 
weakness of the benelux territories 
our largest ict franchise outside  
the uk
it is worth noting that the gp 
breakdowns given above are 
measured by the skill set of the 
candidate rather than the nature of 
the business of the client company 
by the latter metric rather than a 
62 exposure to the ict market the 
group has in fact only a 19 exposure 
2009 21 to ict customers per se 
and hence benefits from a broad client 
base in terms of industry sectors
“high margin high value”
the group has a stated strategy 
which is focused on the quality of the 
business transacted we do not buy 
market share or swap value for volume 
as we believe both to be inappropriate 
given the highly fragmented nature 
of the specialist staffing market we 
are highly selective in terms of the 
type of clients with which we engage 
and avoid the lower margin business 
which is often a condition of dealing 
with many larger employers in more 
mature markets
in addition we look to go “up the 
food chain” and place more highly 
remunerated candidates either 
as a result of increasing the level 
of seniority of the placements we 
make or by identifying more highly 
paid niche markets the benefits 
of this approach can be seen in the 
robustness of our fees and contract 
rates even in a market which 
remained somewhat more price 
sensitive than normal and which  
was not characterised by the level 
of wage inflation typical of a more 
normal market
the group’s overall contract margin 
remained broadly flat at 216 
2009 221 despite a substantial 
reduction in the number of public 
sector contractors which were 
typically higher than the average 
margin moreover in absolute terms 
the average gross profit per day rate 
gpdr improved somewhat up 
11  to £8565 2009 £8469 on a 
constant currency basis pro rated to 
an annual permanent salary the gpdr 
is the equivalent of £90k 2009 £88k
a similar but more pronounced 
value theme was seen in the group’s 
permanent business the average 
fee recorded in 2010 was £12340 
2009 £11930 up 34 on a constant 
currency basis
contractpermanent  
business mix
unlike the early recovery phase of 
previous upturns the contract market 
did not outperform the permanent 
market in 2010 on the contrary and 
in common with the peer group 
our permanent performance was 
markedly ahead of contract during 
the year the group made a total of 
6551 permanent placements 2009 
6060 an increase of 81 the 
number of contract runners at the 
end of 2010 had improved to 4359 
2009 4157 representing an increase 
of 49
the relative weakness of the contract 
market was exacerbated by the fact 
that the market in benelux was weak 
through most of the year and after 
the uk this territory is the group’s 
largest in terms of contract exposure 
on a similar note gp derived from the 
public sector declined by around 50 
during the year and this is largely a 
contract market by contrast some 
of the strongest performing markets 
eg the far east banking oil  gas 
etc are for us disproportionately 
permanent franchises
the net effect of the above was that 
permanent gp represented 49 of 
the group’s total in 2010 compared 
with 42 of gp for 2009 going 
forward into 2011 and beyond we 
would expect a further increase in 
terms of the permanent share of 
gp as the economic cycle enters a 
more positive phase and the group 
chief executive officer’s review 
for the year ended 28 november 2010   continued sthree plc 8
becomes increasingly exposed to 
territories and markets in which the 
prime opportunity is in permanent 
recruitment
headcount
the improved market conditions 
allowed us to continue with the 
sales headcount growth plan that we 
initiated in the second half of 2009 
as a result the group ended 2010 with 
a total of 1863 staff 2009 1597 an 
increase of 167 on the prior year 
the sales headcount growth was 
primarily focused on rest of world  
up 76 and europe up 11 with the 
uk up 6
our 2010 closing headcount of 1863 
is still 18 below our previous peak of 
2274 heads in november 2008 and 
given our expansion plans for the year 
ahead it is likely that this historic peak 
will be surpassed during 2011
outlook
ultimately the global economic 
backdrop will to some extent influence 
the scale of our market opportunity in 
the coming year however it is worth 
remembering that the history of the 
group specifically and the specialist 
staffing market more generally 
demonstrates that we do not need 
exceptionally strong economic 
tailwinds as a precondition for strong 
performance indeed it is candidate 
confidence as much as any other 
major factor which drives demand and 
our experience shows that a healthy 
level of candidate confidence is  
not predicated on abovetrend 
economic growth
in addition we are more exposed than 
ever before to markets with strong 
structural growth characteristics 
recent experience in territories 
such as germany suggest that the 
underlying growth of the specialist 
staffing market can act as a powerful 
counterbalance even when economic 
conditions are dire given that the 
balance of opinion suggests at least 
a benign global economic scenario 
for 2011 markets such as these have 
particularly strong potential at the 
same time our longer established 
franchises had all returned to growth 
by the end of 2010 and we have no 
reason to believe that this is a trend 
which will not continue
t aking all the available indicators 
into consideration we feel there are 
justifiable reasons to remain opti
mistic about the forthcoming year 
as always we take confidence that 
our twenty five year track record 
seasoned management team and well 
established brands to provide us with 
an excellent platform to make the 
most of whatever the market has to 
offer us
russell clements
chief executive officer
28 january 2011
chief executive officer’s review 
for the year ended 28 november 2010 continued