(Adds CEO comments, peer performance, share movement)
By Esha Vaish
Dec 9 (Reuters) - Recruiter SThree said annual profit would exceed market expectations as strong growth in the United States and Europe more than made up for a slowdown in hiring in its domestic business following Britain's vote to leave the European Union.
SThree, which makes three quarters of its gross profit from outside Britain and Ireland, said it expected pretax profit for the year to the end of November to be slightly above the top end of market guidance of 37.3 million to 39 million pounds.
Strong demand for temporary workers in continental Europe and an improvement in U.S. conditions meant the staffing company generated a 2 percent rise in gross profit for the year, it said in a trading statement, sending its shares up 3.6 percent to 285 pence by 1110 GMT.
Staffing firms such as SThree, PageGroup, Hays and Robert Walters are seen as gauges of wider economic health because people tend to switch jobs more often when confidence rises. SThree is the first of the UK recruiters to report results spanning October and November.
Although most British staffing companies have been hit by uncertainty following the surprise Brexit vote in June, their international businesses have continued to offer protection.
SThree, which places staff with financial, energy, banking and pharmaceutical firms, said it would focus on hiring people for temporary jobs in Britain and Ireland.
The company was seeing fewer British jobs coming on to the market and companies hiring temporary staff for slightly shorter durations, depressing profitability for Britain and Ireland.
It noted a slowdown in finance and the public sector hiring after the Brexit vote and public sector reforms.
"Our effort and focus is on our contract business, which is generally more resilient in a downturn, but just as profitable in a good market," Chief Executive Gary Elden told Reuters.
"People are still not making decisions and until the issue around the Brexit is resolved, I think we're not going to have a clear sight of where the market is going," he said.
Gross profit in constant currency for the UK and Ireland fell 12 percent in the fourth quarter ended Nov. 30, marking the biggest quarterly drop for the year.
Larger rival Hays has said companies are still cautious about adding to staff levels because of uncertainty over Brexit, while PageGroup has said confidence among employers was "fragile" following the vote, with finance firms particularly holding off from hiring. (Reporting by Esha Vaish in Bengaluru; Editing by Keith Weir)