Half year results for the six months ended 30 September 2016

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View the video interview with Uwe

Good overall results, with underlying profit before tax up 14.0%, full year outlook unchanged.

Design, engineering and project management consultancy WS Atkins plc (Atkins or the Group) today announces its unaudited results for the six months ended 30 September 2016.

FINANCIAL SUMMARY

Key performance indicators      
  Note Six months to
30 Sept 2016
Six months to
30 Sept 2015
Change
Income Statement - unaudited
Revenue   £994.7m £904.6m 10.0%
Underlying operating profit 1 £65.3m £59.0m 10.7%
Underlying operating margin 2 6.6% 6.5% 0.1pp
Underlying profit before tax 3 £63.6m £55.8m 14.0%
Underlying profit after tax £47.7m £43.0m 10.9%
Underlying diluted EPS 4 48.2p 42.8p 12.6%
       
Statutory operating profit £23.5m £60.0m (60.8)%
Statutory operating margin   2.4% 6.6% (4.2)pp
Statutory profit before tax £22.4m £53.8m (58.4)%
Statutory diluted EPS 22.6p 42.9p (47.3)%
         
Dividend 5 12.5p 11.7p 6.8%
People
Staff numbers at 30 September 6 18,339 18,609 (1.5)%
Average staff numbers 18,335 18,506 (0.9)%
Net (debt)/funds 7 £(90.3)m £141.1m (164.0)%
Work in hand 8 84.1% 84.3% (0.2)pp

HIGHLIGHTS

Financial highlights

  • Revenue up 10.0% to £994.7m, up 4.0% on a constant currency basis
  • Underlying operating profit up 10.7%, underlying constant currency operating profit up 4.3%
  • Underlying profit before tax of £63.6m, up 14%
  • Underlying diluted EPS up 12.6%, interim dividend up 6.8%
  • Net borrowings of £90.3m at September 2016, following acquisition of EnergySolutions’ project, products and technology (PP&T) business

Operational summary

  • Significant increase in UK and Europe profit, up 32.2% supported by strong markets and improved operational delivery
  • Good first half performance in North America, underpinned by two major transportation projects
  • Middle East impacted by more difficult transportation and infrastructure markets and demobilisation of metro projects; good wins in Dubai property market
  • Energy business continues to face challenging market conditions in oil and gas, North American oil and gas impairment of £23.3m in the period
  • First major PP&T project in US (DUF6) secured and integration progressing well

Commenting on the results, Uwe Krueger, chief executive officer, said:

"Despite challenges in some markets, we have delivered good underlying profitability and the near term outlook in our UK and North American businesses is particularly positive. We are confident that our focus on differentiation in nuclear, digital innovation and advisory will deliver further growth over the longer term. Our outlook for the full year is unchanged."

Notes:

  • Underlying operating profit is profit before exceptional items (£2.8m), impairment of goodwill (£18.5m), amortisation and impairment of acquired intangibles (£18.7m), and deferred acquisition payments (£1.8m).
  • Underlying operating margin is the value of underlying operating profit expressed as a percentage of revenue.
  • Underlying profit before tax additionally excludes profit on disposal of business of £0.6m (2015: loss £3.0m).
  • Underlying diluted EPS is based on underlying profit after tax and allows for the dilutive effect of share options.
  • Interim dividend declared for the six months to 30 September.
  • Staff numbers are shown on a full-time equivalent basis, including agency staff.
  • Net debt/funds comprise cash and cash equivalents plus financial assets and loan notes receivable less borrowings.
  • Work in hand is the value of revenue to date plus contracted and committed work at 30 September that is scheduled for the remainder of the financial year, expressed as a percentage of the forecast revenue for the year.
  • Constant currency is used as a comparative measure to remove the impact of foreign exchange.

Enquiries

Heath Drewett, Group finance director + 44 (0) 20 7121 2000
Kate Moy, Group investor relations director + 44 (0) 20 7121 2000
Matt Graydon, Group PR director + 44 (0) 20 7121 2000

Notes to editors

1. Atkins
Atkins (www.atkinsglobal.com) is one of the world’s most respected design, engineering and project management consultancies, employing some 18,300 people across the UK, North America, Middle East, Asia Pacific and Europe. We build long-term trusted partnerships to create a world where lives are enriched through the implementation of our ideas. You can view Atkins’ recent projects on our website.

2. Attachments
Attached to this announcement are: the overview of the period, business review, financial review, table of principal risks and uncertainties, statement of going concern, statement of directors’ responsibilities, the unaudited: consolidated income statement, consolidated statement of comprehensive income, consolidated balance sheet, consolidated statement of cash flows, consolidated statement of changes in equity, notes to the condensed consolidated interim financial information and the independent auditor’s review report.

3. Analyst Presentation
A presentation for analysts will be held today at the Lincoln Centre at 0830. Dial-in details are available from +44 (0) 20 7353 4200 for those wishing to join the presentation by conference call. A webcast of the presentation will be available via the Company’s website, www.atkinsglobal.com.

4. Cautionary Statement
This announcement has been prepared for the shareholders of Atkins as a whole and its sole purpose and use is to assist shareholders to exercise their governance rights. In particular, this announcement has not been audited or otherwise independently verified and no warranty is given as to its accuracy or completeness (other than any such warranty which is mandatorily implied by statute). Atkins and its directors and employees are not responsible for any other purpose or use or to any other person in relation to this announcement and their responsibility to shareholders shall be limited to that which is imposed by statute.

This announcement contains indications of likely future developments and other forward looking statements that are subject to risk factors associated with, among other things, the economic and business circumstances occurring from time to time in the countries, sectors and business segments in which the Group operates. These and other factors could adversely affect the Group’s results, strategy and prospects. Forward looking statements involve risks, uncertainties and assumptions. They relate to events and/or depend on circumstances in the future which could cause actual results and outcomes to differ materially from those currently expected. No obligation is assumed to update any forward looking statements, whether as a result of new information, future events or otherwise. Nothing in this announcement should be construed as a profit forecast.