Spring Group says UK recruitment market 'robust'

LONDON, Aug 6 (Reuters) - British recruitment company Spring Group SPGR.L said demand for its services was holding up despite more uncertain economic conditions in the UK. "Our market is still proving to be robust," Chief Executive Peter Searle told Reuters after the group posted a 52 percent rise in first-half profits earlier on Wednesday.

The group, which mainly supplies IT staff, had little exposure to areas of the economy being hit hardest by the credit crunch, he said.

"Our exposure is across the UK, and while 20 percent of our business is to banks, it is mainly in the retail area rather than in investment banking," he said. "Our customers such as National Grid (NG.L) and Network Rail remain robust."

Spring has also diversified outside the UK by opening offices in France, Italy, Germany and Australia, and Searle said the group planned more.

"Europe is a big target area," he said. "We believe deregulation in France and Germany is a massive opprotunity for growth."

Spring's shares were up 8 percent at 44.5 pence at 1133 GMT, as the market responded to the group's confident outlook.

"With 80 percent of net income profit coming from temporary placements, and much of the business delivered under (managed solution) RPO contracts or long-term project management contracts, Spring is well positioned to weather a slowdwon," Collins Stewart analyst Julian Carter said in a note.

Spring posted pretax profit of 3.4 million pounds ($6.65 million) for the six months to June 30, against 2.2 million pounds for the same period a year ago.

Revenue was up 31.5 percent at 250.5 million pounds, and the gross margin improved to 13.6 percent, from 12.3 percent, thanks to a focus on higher quality business, Searle said. (Reporting by Paul Sandle, editing by Will Waterman)