TIDMHYC
Annual Results
HYC.L
Hyder Consulting PLC (HYC.L)
Annual results announcement for the year ended 31 March 2009
Hyder Consulting, the multi-national advisory and design consultancy, today announces its annual financial results
for the year ended 31 March 2009.
Highlights
* Order book up 22% to GBP384.0m
* Revenue up 37% to GBP319.0m
* Adjusted operating profit(i) up 16% to GBP17.4m
* Adjusted profit before tax(i) up by 8% to GBP15.6m
* Final dividend up 50% to 4.5p per share
* Cash conversion 88%, with net debt of GBP5.7m (2008: GBP11.1m)
(i) Adjusted operating profit and profit before tax are before amortisation of intangible assets arising from
business combinations and exceptional items.
Sir Alan Thomas, Chairman of Hyder Consulting PLC commented:
"I am pleased to report another strong year for the Group with results ahead of last year and of market
expectations. Our leaner structure and low gearing, together with our geographic and market spread, equip us well
to manage the challenges ahead and to take advantage of the opportunities which will arise."
Press contacts:
Hyder Consulting PLC
Ivor Catto, Chief Executive Tel: +44 (0)20 7904 9011
Russell Down, Finance Director Tel: +44 (0)20 7904 9020
Biddicks
Shane Dolan Tel: +44 (0)20 7448 1000
Chairman's Statement
I am pleased to report another year of growth for the Group with both profits and cash ahead of last year and of
market expectations.
Results
Revenue grew to GBP319.0m (2008: GBP233.7m), an increase of 37%, 25% on a constant currency basis. Net revenue, after
deduction of sub-consultant costs, increased by 37% to GBP269.9m (2008: GBP196.9m).
Adjusted operating profit grew by 16% to GBP17.4m (2008: GBP15.0m), although the economic climate affected the net
revenue margin at 6.4% (2008: 7.6%). In the second half of the year, GBP8.6m was incurred in restructuring the
Group, resulting in exceptional costs for the full year of GBP9.1m. Operating profit after exceptional items and
amortisation amounted to GBP5.0m (2008: GBP13.4m).
Profit before tax, exceptional items and amortisation of acquisition intangibles rose by 8% to GBP15.6m (2008:
GBP14.4m).
The effective rate of tax on adjusted profits was 13.9% (2008: 13.6%), due to profits earned in zero tax
jurisdictions in the Middle East and Research and Development tax credits in both the UK and Australia. A tax
credit of GBP0.3m was recognised in the year (2008 charge: GBP1.6m).
Adjusted fully diluted earnings per share increased by 4.5% to 34.87p (2008: 33.36p). Fully diluted earnings per
share after exceptional items and amortisation was 9.12p (2008: 30.91p).
Funding
At 31 March 2009 net debt reduced to GBP5.7m (2008: GBP11.1m) due to a much improved cash conversion rate of 88%
(2008: 23%). Cash balances at the year end amounted to GBP18.1m and our principal banking facilities of GBP38m are
committed until 2012/13 contributing to considerable headroom. The Group operates comfortably within its banking
covenants which we expect to continue.
Dividend
The Directors are pleased to propose a final dividend of 3.15p per share (2008: 2.10p) making a full year dividend
of 4.5p per share (2008: 3p), a rise of 50%. The full year dividend is covered 7.7 times by adjusted fully
diluted earnings per share (2008: 11.1 times).
Operating highlights
In the UK our transportation business performed strongly. In the rail sector, we were approved for all seven of
the Crossrail frameworks, and won a major project on the North London Line. Hyder is client representative on the
M25 widening DBFO contract and works closely on projects with Transport for London and the UK Highways Agency. The
UK's utilities business has also performed well and we retain a strong presence in the water sector. Severn Trent
Water has already appointed Hyder on its AMP5 programme, and our water and marine engineering teams have been
engaged on a number of London 2012 Olympics projects. In Northern Ireland we completed our design for the GBP120m
Project Omega PFI programme. We have made important progress too in the energy and environment sectors. Though the
commercial property market has softened considerably, we have reorganised to present a co-ordinated,
multidisciplinary approach towards development planning and design - meeting the needs of land developers and
regional development agencies. In Germany, our recent acquisitions, Voigt and Seib, have performed well and have
now been merged with our existing business into a single entity bearing the Hyder Consulting brand. The business
has a strong profile in airports and public sector infrastructure, and secured two major contracts at the new
Berlin Brandenburg International Airport. In highways, we were awarded the design approval and construction
supervision role on the A5 autobahn PPP project in south west Germany. This third motorway PPP win increases our
reputation as the leading PPP consultant in the country.
In the Middle East our business performed particularly strongly with overall net revenue increasing by 70%. Only
25% of the business is related to the Dubai property sector and over 55% of our fee income from the region comes
from the oil and gas based economies of Abu Dhabi, Qatar and Bahrain where our longstanding presence has helped us
win major projects in the highways, infrastructure and water sectors. Our work on Burj Dubai, the world's tallest
building, and the surrounding infrastructure is progressing well. Although the Dubai market slowed in the latter
half of the year, which affected cash collections, we have adapted by downsizing our operations and moving work
offshore whilst reinforcing our longstanding client relationships. Holford Associates, which we acquired in 2008,
has integrated well and enables us to offer clients a multi-disciplined capability from concept through to
commissioning. The property sector in the Northern Gulf and Abu Dhabi continues to be strong. Our offshore
production centre in Manila, where we now have 200 staff, is becoming an increasingly important competitive asset.
In Australia, Hyder is part of high profile alliances working on the West Gate Freeway Upgrade for the Victoria
State Government and the Ipswich Motorway Upgrade for the Queensland State Government and is competing for five
other high profile transport infrastructure schemes. Recent significant contracts include: a role on the
Government's 'Building the Education Revolution' programme, part of its economic stimulus package; lead designer
on the large Royal North Shore Hospital scheme; and Australian interstate water trading reform. Hyder was also
part of the winning team for the prestigious Te Wero Bridge competition in New Zealand. In China, government
stimulus packages aim to develop cities and infrastructure to cater for the growing trend in urbanisation which we
expect to create significant opportunities. In Hong Kong, a major public sector expenditure programme,
particularly transport infrastructure, is underway. We have already secured a role on the Mass Transit Railway,
with further opportunities in the pipeline. Our Landscape and Planning business (ACLA) has performed well across
Hong Kong, China and Vietnam. Its work on the Hong Kong Greening Master Plan won Sustain Magazine's International
Project of the Year award. During the year, Hyder won ten awards which is testimony to the international spread of
its engineering expertise and reputation.
Strategy
Our central objective is to enhance shareholder value and our first task is to grow and sustain our operating
margins. To do so, we shall strive to maintain and enhance relationships with our clients, concentrating on those
sectors and applications where we have specialist capabilities and are able to offer a differentiated service. We
shall combine this market approach with close attention to high standards of project management and tight control
over staff utilisation and overheads. We are attaching high priority to the conversion of profit into cash and
have introduced new procedures to ensure we utilise best practice throughout the Group.
Following a review of operations early in 2009, we restructured the business in order to align our services more
closely with our core markets, to improve our operational efficiency and to deal with changes in market
conditions. As a result, we have reduced our headcount by about 8% and incurred one-off, exceptional costs of
GBP8.6m in the second half of the year. We forecast that this will result in annualised cost savings of GBP19m,
including overhead savings of approximately GBP4m per annum.
We have simplified the management structure, and regional operations have been organised on a client-facing,
market-sector basis covering transportation, utilities, property, and environment. This lean structure aligns our
resources and capabilities with clients' needs, allowing regions to draw upon the resources of the Group to
increase their competitive capability. This will help us build deeper client relationships and respond with
greater agility to market opportunities.
People
We currently employ approximately 4,700 people across our regions, c. 4,500 on a full time equivalent basis, which
is lower than the half year as a consequence of the restructuring. The retention and development of staff remains
a key priority and we are continuing targeted recruitment at graduate level and for specific project
opportunities. We want our people to benefit from the best career opportunities and fill vacancies by internal
promotions wherever possible. We actively encourage staff to gain experience in different regions and there was a
15% increase in regional staff transfers during the year.
Board of Directors
There were a number of important changes to the Board during the year. Ivor Catto was appointed CEO in December
2008 having been recruited from WS Atkins where he had headed its largest division. His experience and the steps
he has already taken give the Board confidence that we have the leadership necessary to address the Group's
priorities. Russell Down was promoted to the Board as Finance Director in December 2008, an experienced internal
appointment to complement Mr Catto. Tim Wade, former Chief Executive, and Simon Hamilton-Eddy, former Financial
Director, retired in November and December 2008 respectively, and Keith Reynolds, former Executive Director,
resigned in February 2009; we wish them well.
In addition, as announced on 1 May 2009, Peter Morgan, our senior independent director, has indicated his
intention to retire from the Board, effective from the end of the 2009 Annual General Meeting on 23 July 2009. I
would like to express the Board's appreciation for his much valued contribution. In anticipation of Mr Morgan's
retirement, Jeffrey Hume has replaced Mr. Morgan as Chairman of the Audit Committee; and Paul Withers has replaced
Mr Morgan as Chairman of the Remuneration Committee and Senior Independent Director.
Outlook
With over two thirds of net revenue earned overseas, the Group is broadly spread across both geographies and
market sectors. Our order book has increased by 22% to GBP384m, the largest growth coming from our international
markets. We have already secured approximately 60% of our budgeted revenue for the year ahead.
The economic climate remains uncertain and the private property market has declined. However, we are confident
that we have taken the necessary action to respond to these market conditions and are encouraged that Governments
in all regions intend to maintain or expand their expenditure on infrastructure which should lead to increased
demand in the transportation and utilities sectors. Our leaner structure and low gearing, together with our
geographic and market spread, position us strongly to manage the challenges ahead and to take advantage of the
opportunities which will arise.
Finally, on behalf of the Board, I would like to express thanks to our clients for their cooperation and support
and to our hardworking staff for enabling us to report these results.
Sir Alan Thomas
Chairman
Business Review
UK / Europe
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Key Performance Indicators 2009 2008
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Revenue GBP128.2m GBP118.2m
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Adjusted operating profit GBP8.3m GBP9.7m
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Adjusted operating margin 6.5% 8.2%
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Order book GBP145.3m GBP151.5m
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Number of employees 1,926 1,983
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Regional revenues have increased by 8% this year, primarily as a result of prior year acquisitions, although our
profits have declined due to the current economic climate in the UK and project related write downs in our German
property business.
Our UK transport business has performed well, with the investment in rail bearing fruit. We secured a major win
with the North London Line and were the only consultant to be approved for all seven of the Crossrail frameworks.
We are also working on a number of other high profile contracts for Network Rail and its partners.
We retain our reputation for strong technical implementation. We are working in the client representative's role
on the M25 widening DBFO contract and work closely with Transport for London as a framework supplier. In addition,
we are working on other major road schemes in the UK, Ireland and Eastern Europe, as well as successfully
providing services on a number of high profile frameworks for the UK Highways Agency. We are also supporting a
number of large multidisciplinary projects within the Middle East.
In our utilities business, we retain a strong profile in the water sector and have already been signed up for an
advance component of the AMP5 programme with Severn Trent Water. Our water, marine and geotechnical engineering
teams are working with a number of contractors to prepare sites and facilities which will be used for the London
2012 Olympics.
In Northern Ireland we have completed our design services for the GBP120m Project Omega PFI programme for the
Department of the Environment Water Service working with our partners Laing O'Rourke and Veolia. The energy side
of our utilities business shows good signs of growth. We entered into a partnership with specialist nuclear
advisors Bradtec, and have subsequently secured important commissions for Magnox South and North and the Nuclear
Decommissioning Agency. We have completed the strategic environmental assessment for selection of several new
build sites announced in April 2009. In addition we completed the concept and outline design of a 60MW biomass
power station in the north east, wind power installations in Wales and Scotland and tidal lagoon energy facilities
in the Severn Estuary.
Our new structure allows the environment business to provide a wide range of specialist disciplines in a well co-
ordinated offer. The business is supporting more public sector clients including major opportunities with the
Highways Agency, Welsh Assembly and the Waste and Resources Action Programme. In the private sector, the team are
working with a range of clients on sustainability related issues.
Our reorganisation has also allowed us to present a more co-ordinated approach towards development planning and
design - servicing the needs of land developers, and regional development agencies, through a multidisciplinary
service. We are also supporting the Building Schools for the Future programme in a number of locations. Our strong
contractor relationships are helping us secure national scale contracts and urban regeneration, coupled with
underlying demand for social and private residential development, and will provide us with good opportunities for
the future.
In Germany, the integration of Hyder Acerplan, with our recently acquired entities Voigt and Seib has progressed
well with all three companies trading as Hyder Consulting from 1 April 2009.
The business has built on its strong profile in airports and public sector infrastructure, securing two major wins
at the new Berlin Brandenburg International (BBI) Airport covering supervision and site management of the airport
business park, together with the implementation and management of the plan-approval procedure for the northern
part of the airport and western apron. Our relationships with Fraport AG and FBS GmbH, the company behind the
construction of BBI, ensure a good workflow from ongoing projects.
In highways, we were awarded the design approval and construction supervision role on the A5 autobahn PPP project
in south west Germany. This was our third motorway PPP win and increases our reputation as the leading PPP
consultant in the country.
Middle East
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Key Performance Indicators 2009 2008
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Revenue GBP106.9m GBP53.9m
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Adjusted operating profit GBP8.3m GBP4.6m
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Adjusted operating margin 7.8% 8.5%
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Order book GBP167.0m GBP116.5m
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Number of employees 1,599 1,497
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With our 45 year presence, geographic spread and established client relationships, we have a strong position in
the region. Whilst total revenue almost doubled, adjusted operating profits increased by 80%. These results also
benefited from the weakness of sterling during the year.
Over 55% of our work in the region comes from the oil and gas based economies of Abu Dhabi, Qatar and Bahrain
where we have a long standing presence. Hyder has good relationships and reputation in these locations for its
highways, infrastructure and water capabilities which represent significant opportunities. Recent project wins in
these areas include the Diyaar Al Muharraq mixed use development in Bahrain and a number of Abu Dhabi Sewerage
Services Company (ADSSC) improvement schemes. Meanwhile, significant infrastructure projects in Qatar, including
Lusail and Education City, continue to increase in scale. Our success in infrastructure projects this year in
these areas has led us to recruit almost 100 new employees to resource work effectively.
Our work on Burj Dubai, the world's tallest building, and the surrounding infrastructure is progressing well and
other significant projects we have been working on in Dubai this year include Jumeirah Garden City, Dubai Mall,
and Labour City.
The Dubai market slowed in the latter half of the year and liquidity issues have resulted in slower payments,
increasing our level of working capital. Through our longstanding presence in the region and key client
relationships we are well placed to overcome these challenges. We have downsized our Dubai operations but also
minimised our exposure to the market by previously restricting our growth and moving work offshore. In addition,
our strategy of building strong relationships, and working almost exclusively for Dubai Government related
entities on projects which have good viability leaves us well placed.
Our management advisory team, with support from the UK, has secured roles in restructuring procurement for several
PPP contracts for water supply and wastewater services for the cities of Jeddah, Medinah / Taif, Mecca and Greater
Dammam in Saudi Arabia. We have also supported Samsung of Korea in submitting significant tender design schemes
for two GBP200m contracts as part of the Abu Dhabi STEP Tunnel programme.
Holford Associates, which we acquired in 2008, is integrating well into the business and enables us to offer
clients a holistic concept to commissioning capability. This, together with our strong property offering,
particularly in high rise which has been well received in Abu Dhabi and Qatar, provide us with good opportunities
outside Dubai.
Our offshore production centre in Manila, where we employ over 200 staff, enables us to provide good quality
design work in a flexible and cost effective manner which is important in an increasingly competitive market.
Asia Pacific
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Key Performance Indicators 2009 2008
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Revenue GBP83.8m GBP61.6m
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Adjusted operating profit GBP4.5m GBP3.7m
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Adjusted operating profit 5.4% 6.0%
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Order book GBP72.2m GBP46.0m
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Number of employees 1,169 1,276
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Revenue has increased by 36% predominantly in Australia as a result of infrastructure contracts, which has
resulted in adjusted operating profits increasing by 22%. Margins have fallen as a result of lower utilisations in
the current economic climate and increased overhead costs to drive growth.
We have secured major project wins in the transport sector. Alliancing, and design and construction (D&C)
contracts are the predominant means of implementation in Australia and Hyder has a good reputation in this area,
being part of the high profile M1 Alliance working on the West Gate Freeway Upgrade for the Victoria State
Government, and the Ipswich Motorway Upgrade, a D&C contract for the Queensland State Government. We are also
participating in bidding teams for five other high profile Australian transport infrastructure schemes.
Although we have scaled back our property offering, in line with market demand, we have recently secured
significant contracts from the Australian Government's 'Building the Education Revolution' programme which is part
of a major national economic stimulus package worth over GBP6bn invested over three years. We have been appointed
lead designer on the large Royal North Shore Hospital scheme which puts Hyder in prime position in the shift
towards social infrastructure in the property sector and to capture more work from the new hospitals programme.
Our work with the Council of Australian Governments, as part of interstate water trading reform, has been well
received. Water remains a key issue in Australia and presents us with good opportunities for the year ahead.
Hyder was part of the winning team for the prestigious Te Wero Bridge competition in Auckland, New Zealand. Our
innovative design was praised by the judging panel and will form an important connection between the city centre
and the waterfront area.
In China, government stimulus packages aim to develop cities and infrastructure to cater for the growing trend in
urbanisation. We see significant opportunities arising from this with both public and private sector clients. In
Hong Kong, a significant public sector expenditure programme, with particular emphasis on transport infrastructure
is underway. We have already secured a role on the Mass Transit Railway programme, with further opportunities in
the pipeline.
Our Landscape and Planning business (ACLA) has performed well across Hong Kong, China and Vietnam. We continue
our work on the Hong Kong Greening Master Plan which won Sustain Magazine's International Project of the Year
award.
We have restructured our East Asian operations to align with our key sector strengths in transport and property.
We have developed differentiated service offerings in Hong Kong, Shanghai, Beijing and Hanoi in landscape and
planning, transport planning and facades, and our relocation to new larger offices in Beijing and Shanghai has
enabled us to grow the teams in those cities. In Vietnam we see opportunities in both the property, and landscape
and planning sectors.
People and culture - being an employer of choice
At the year end we had 4,694 employees across all our regions. We have maintained recruitment in targeted growth
sectors, despite a number of redundancies in the Group, in order to ensure that we resource projects and clients
effectively. We are committed to providing our people with the best possible career development opportunities and
raising Hyder's profile as an employer of choice.
Upholding equal opportunities
We recruit the right people for the right job, regardless of gender, age and origin and we promote employees based
on their skills, qualifications, abilities and aptitudes.
As an international consultancy, we aspire to best practice in dealing with our staff (including equal
opportunities and anti-discrimination) within each jurisdiction in which we operate. Local legislation lays down
minimum standards and, where appropriate, we aim to surpass it.
Consistency in career development
In line with our HR strategy and our new structure, we have sought to bring greater clarity and consistency to all
our roles including revising our career paths and introducing a new grading system.
These actions recognise the multi-national nature of our business and will assist our people when transferring
between regions by providing a consistent framework.
Training and development
We have undertaken a number of other HR initiatives to facilitate career development for our people:
* we provided Leadership Blueprint training in all regions for senior managers to help them develop the
necessary skills and behaviours to be successful and high performing leaders;
* we have developed our talent management strategy and formalised our high potential employee programmes
across the Group;
* we have incorporated an assessment centre into our graduate recruitment programme - a feature which is
highly valued by graduates;
* we are replicating our UK graduate development programme, including the Graduate of the Year competition,
across all our regions; and
* we have revised the personal development review (PDR) process to introduce consistency across all regions
and roles. Through this process, we are better able to identify appropriate training, coaching and mentoring to
help each employee's development.
Empowering our managers
Our restructure has streamlined management and brought greater accountability and empowerment to divisional heads.
They now have full profit and loss responsibility and will lead in driving a culture of successful client
relationship management and high performance. We have launched a training programme to assist them in this and
enhance their commercial and management skills.
Encouraging employee mobility
We want to ensure that our people benefit from the best career opportunities and seek to fill vacancies by
internal promotions wherever possible. We actively encourage employee mobility between all regions and this year
we have seen a 15% increase in employees taking up new roles in offices in other geographies.
Employee engagement a key driver to success
This year we carried out an employee engagement survey which was a significant step beyond our previous employee
satisfaction surveys; research has shown a clear link between employee engagement and performance/retention.
Having conducted the survey, we are better able to understand employees' motivations and loyalty towards Hyder and
how we can build on this.
The survey generated a high response rate and positive results which reflect our people's strong loyalty and
commitment to Hyder. It has also enabled us to pinpoint the areas we need to improve and each region has developed
action plans to address the major factors inhibiting employee engagement that will enhance the employee experience
at Hyder.
Remuneration
We remain committed to ensuring our remuneration policies and arrangements are competitive and have introduced a
new bonus scheme for employees with a profit and loss responsibility. This supports our move to increasing
employee accountability and driving a culture of performance management.
Awards - testimony to our success
Hyder has been recognised in 2009 with a number of prestigious awards, set out below, which showcase our talented
people, innovation and strong market position.
NCE - International Consultant of the Year finalist: having won the award for International consultant of the year
in 2007 we were pleased to be nominated as a finalist for the award this year.
Sustain Magazine - International Project of the Year 2009: awarded for developing and implementing Hong Kong's
Greening Master Plan for the Central district. The Hong Kong Greening Master Plan is the single largest landscape
and urban improvement project which aims to improve the quality of life and environment for Hong Kong's citizens.
Hong Kong Institute of Landscape Architects - Certificate of Merit for Excellence: awarded for our work on the RF
You Yi Cheng Park, Beijing. This 12 hectare park project takes its design direction from Beijing scale, climate
and user activities. Particular emphasis was placed on landform creation to define special character.
Te Wero Bridge design competition - winner: design by Hyder Consulting, Denton Corker Marshall and Kenneth Grubb
Associates selected as winning entry by Auckland City Council. The judging panel was impressed by the high level
of design innovation, the dramatic effect of the bridge opening and closing and the landmark impact the bridge
design would create.
Institution of Structural Engineers - Heritage Award for Infrastructure: awarded for our work on the Westminster
Bridge fascia replacement project.
Institution of Highways and Transportation/ Centre for Protection of National Infrastructure - Security in the
Public Realm Award 2008 - awarded to West One, together with Westminster City Council and the Cabinet Office for
their work on the Whitehall Streetscape Project.
Urban Development Institution of Australian NSW Awards for Excellence - Sustainability: awarded for the design
measures used in the New Rouse Hill development north west of Sydney. Our innovative approach of using water
modelling in developing design solutions resulted in initiatives that were new to the area and also delivered
community and environmental benefits.
Investors in People: we are proud that this award recognises our continuing commitment to our greatest asset, our
people.
RoSPA Gold Medal Award 2009: awarded to Hyder for sustained achievement in Health and Safety performance in the
UK; five consecutive gold awards.
MEP Middle East - Training Award: awarded to Hyder Consulting Middle East Ltd in recognition of the holistic
internal training programmes which help Hyder to provide clients world class services consistently.
Principal risks and uncertainties
The Group faces a number of risks, which are regularly monitored by the Board. The risk management and internal
control systems provide an ongoing process for identifying, evaluating and managing the significant risks facing
the Group. However these systems can only operate to mitigate risk rather than eliminate risk completely. The
Group's principal risks are as follows :
Key markets, sectors and clients
The Group's workload is dependent on economic factors in the markets in which we operate and the relationships
built up with our clients. Our strategy of international growth, key client management and acquisition has
resulted in a strongly diversified Group which is not dependent on individual markets, sectors or clients, leaving
us well placed in the current economic climate. We continue to drive our strategy of differentiation and
diversification to further strengthen our resilience.
Resources
The maximisation of staff utilisation rates, and the ability to manage quality staff resources is critical to the
Group's ability to win and execute projects and future profitability. We regularly review utilisation rates
throughout our business and monitor these against pre-set targets taking prompt action where appropriate. Our
human resources function plays a key role in assisting the business to develop recruitment and retention
strategies, and with staff development and succession planning.
Contractual disputes and claims
The Group employs a Risk Manager who continues to review and enhance our risk management procedures in order to
minimise claims. Whilst the risk of claims and pressure to assume more onerous contractual terms can increase in
an economic downturn, established procedures exist to deal with these and minimise any exposure. It is the
Group's policy to mitigate its exposure to key contractual risks through insurance at commercially acceptable
rates for appropriate limits of indemnity.
Foreign exchange movements
Approximately two thirds of the Group's revenues are earned in currencies other than sterling. The revenue and
costs of our international operations largely arise in the same currency. Established procedures exist to reduce
exposure to currency fluctuations in accordance with the policy set by the Board. The Group does not hedge
translation exposure to foreign currencies.
Funding
The Group recognises the importance of cash management and regularly forecasts global cash requirements and
monitors debt and work in progress levels with clients. In the current economic environment there is an increased
credit risk with clients, particularly in Dubai, which is mitigated through developing close working relationships
and seeking advance payments where possible. The Group maintains strong relationships with its principal bankers.
Integrity and sustainability of IT networks and core business systems
The Group's IT networks and core business systems are maintained and supported to provide assurance on data
integrity and minimise the risk of data loss. An upgrade of our core business systems is being progressively
implemented on a regional basis using an in-house project team and third party consultants as appropriate. This
regional implementation programme is designed to minimise the potential for disruption in the business.
Competitors
The Group operates in a competitive business environment and whilst we are strongly diversified we recognise the
impact that the actions of competitors or potential competitors may have on our business. In order to mitigate
the effects of competition we seek to differentiate ourselves through our service offering, outstanding people and
strong client management.
Financial Review
Revenue and Profit
Revenue for the year increased by 37% to GBP319.0m (2008: GBP233.7m). Net revenue, after deduction of sub-consultant
costs, increased by 37% to GBP269.9m (2008: GBP196.9m). Organic growth in revenue and net revenue was 25% and 26%
respectively.
In presenting the Group's adjusted operating profit below, amortisation of intangible assets arising on business
combinations and certain one off exceptional items have been excluded as the Directors believe that this assists
with understanding the underlying performance of the Group:
2009 2008
GBP'000 GBP'000
Group operating profit 5,008 13,415
Add back :
Amortisation on business combinations 3,241 1,802
Exceptional items 9,139 (180)
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Adjusted operating profit 17,388 15,037
Net finance costs (1,796) (667)
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Adjusted profit before taxation 15,592 14,370
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Adjusted operating profit increased 16% to GBP17.4m (2008: GBP15.0m) and adjusted profit before taxation increased 8%
to GBP15.6m (2008: 14.4m), benefiting from the weakness of sterling during the year. The adjusted operating margin
on net revenue declined to 6.4% from 7.6% reflecting the current economic conditions in our markets which impacted
on utilisation levels and project margins, and an increase in overhead costs. The restructuring of our operations
in the second half of the year has sought to address these issues.
Exceptional items
Exceptional costs of GBP8.6m were incurred in the second half of the year with the restructuring of the Group to
streamline and better align our service offerings with the markets and sectors in which we operate, and address
areas of market weakness. The cash impact in the year amounted to GBP2.3m, approximately GBP2.9m was deferred to the
new financial year, with the balance relating to property provisions which will be paid out over the remaining
lease terms. An analysis of the restructuring costs for the full year of GBP9.1m is shown in Note 1. In the prior
year a gain of GBP0.2m was recognised as a result of members transferring out of the Acer Group Pension Scheme
(AGPS).
Financing
The net finance cost of the Group increased to GBP1.8m (2008: GBP0.7m) reflecting prior year interest income received
in relation to settlement of an overdue debt (GBP0.5m), and increased charges for financing costs on pension schemes
(GBP0.3m) and deferred and contingent consideration (GBP0.2m).
The Group's principal banking facilities totalling GBP47.1m are with HSBC and Barclays in the UK which include
revolving credit facilities of GBP20m and GBP18m expiring in April 2012 and February 2013 respectively, and other long
term facilities of GBP9.1m. In addition the Group has access to a number of overseas and on demand facilities of a
further GBP7.8m. All facilities are unsecured. Total committed banking facilities amount to GBP47.6m giving
substantial headroom with year end net debt of GBP5.7m.
In line with market practice, under the terms of its principal banking facilities the Group is required to operate
within certain financial covenants related to net debt (including guarantee liabilities), EBITDA, debt service
costs and interest cover. At the year end the Group had significant headroom within all of these covenants.
Taxation
In the year a taxation credit of GBP0.3m (2008: charge GBP1.6m) has been recognised. The tax rate on adjusted profit
before tax amounts to 13.9% (2008: 13.6%). The current low rate reflects increased profits in zero tax
jurisdictions in the Middle East and Research and Development tax credits in both the UK and Australia.
Earnings Per Share
Earnings per share are impacted by the amortisation of intangible assets arising on business combinations, and
other one off items. Basic earnings per share amount to 9.12p (2008: 30.91p); diluted earnings per share amount
to 9.10p (2008: 30.04p) reflecting the significant exceptional items in the year. The weighted average number of
ordinary shares during the year was 38.4m (2008: 36.1m). Adjusted fully diluted earnings per share increased by
4.5% to 34.87p (2008: 33.36p).
Dividends
A final dividend is proposed for the year to 31 March 2009 of 3.15p per share (2008: 2.10p) giving a 50% increase
for the year to 4.5p (2008: 3p). The full year dividend is covered 7.7 times by adjusted fully diluted earnings
per share (2008: 11.1 times). The dividend, if approved by the shareholders, will be paid on 7 August 2009 to
shareholders on the register at 10 July 2009.
Capital Structure
During the year the Company issued 57,500 10p ordinary shares, in relation to exercised share options and as at 31
March 2009 had 37,754,847 (2008: 37,697,347) fully paid ordinary shares in issue.
During the year to 31 March 2009 shareholders' equity increased by 18% to GBP58.8m (2008: GBP49.7m) reflecting
retained earnings for the year, foreign exchange gains and actuarial losses on defined benefit pension schemes.
Net debt amounted to GBP5.7m at 31 March 2009 (2008: GBP11.1m).
Shareholder Return
Equity has increased during the year to GBP58.8m (2008: GBP49.7m), equating to a net asset value of 156p per share
(2008: 132p). The closing share price on 31 March 2009 was 76p per share (2008: 410p) representing a market
capitalisation for the Group of GBP28.7m (2008: GBP154.6m).
Retirement benefit obligations
The Group operates both defined benefit and defined contribution schemes.
The principal defined benefit scheme is the AGPS, which was closed to new members in 2001, and for which a
pensionable salary freeze is currently in place until March 2012. The deficit in the scheme at 31 March 2009
increased to GBP26.5m (2008: GBP22.5m). The increase in the deficit reflects lower than expected asset returns,
partially offset by actuarial gains due to increased discount rates.
The sensitivities of the AGPS scheme liabilities to changes in these assumptions are shown below:
Assumption Change in assumption Indicative effect on scheme liabilities
=-----------------------------------------------------------------------------------------------------------
Discount rate Increase / decrease by 0.5% Decrease / increase by 9%
Rate of inflation Increase / decrease by 0.5% Increase / decrease by 6%
Longevity Increase by 1 year Increase by 3%
The Group operated a defined benefit scheme in Hong Kong which was closed during the year resulting in a
curtailment gain of GBP0.8m being recognised as an exceptional item.
The net finance costs for pension schemes amounted to GBP0.3m in the year (2008 income: GBP19,000).
The Board acknowledges that valuations of defined benefit schemes under IAS 19 are inherently volatile, and will
continue to take action where appropriate to reduce the AGPS deficit.
Overseas post employment benefits relate principally to benefits payable on termination to staff in the Middle
East and increased to GBP7.3m (2008: GBP4.2m) as a result of the increase in staff numbers during the year.
Cash Flow
Net debt amounted to GBP5.7m at 31 March 2009 (2008: GBP11.1m).
Cash generated from operating activities was GBP19.5m (2008: GBP4.2m), primarily reflecting improvements in working
capital procedures made during the second half of the year. Trade receivables and net work in progress increased
in the year from GBP72.9m to GBP85.0m primarily as a result of foreign exchange movements (GBP11.0m). The proportion of
EBITDA converted into operating cash flow in the year was 88% (2008: 23%).
Acquisitions
As a result of the Group's prior year acquisitions the charge for amortisation of intangible assets from business
combinations has increased in the year to GBP3.2m (2008: GBP1.8m). No acquisitions have been made in the current
financial year.
Treasury
Established procedures exist to monitor cash flow, currency and interest rate risks in accordance with the policy
set by the Board.
Approximately 30% of the Group's revenue is generated in Sterling. The remaining balance is generated in the
Middle East (mainly the UAE), Germany, Hong Kong and Australia where revenue is normally denominated in the
relevant local currency. The revenue and costs of our international operations generally arise in the same
currency and therefore the exposure to exchange fluctuations is usually not significant and consequently not
hedged. Where a mismatch does exist it is generally priced for in our customer contracts. Most of our overseas
operations maintain local currency overdraft and bonding facilities, which provide partial mitigation against
balance sheet risk. In spite of fluctuations in exchange rates which occur from time to time, it is not
considered necessary to hedge the net investment in overseas subsidiaries at this time.
Ivor Catto Russell Down
Chief Executive Finance Director
Condensed Financial Statements
Consolidated Income Statement for the year ended 31 March 2009
2009 2008
Note GBP'000 GBP'000
-------------------------------
Revenue 1 318,970 233,672
Cost of sales
Sub-consultant costs (49,067) (36,765)
Other operating costs (190,499) (139,325)
-------------------------------
Gross profit 79,404 57,582
-------------------------------
Administration expenses (74,396) (44,167)
-------------------------------
Group operating profit 1 5,008 13,415
-------------------------------
Analysed as:
EBITA (Pre-exceptional items) 18,677 16,041
Amortisation of intangible assets
- Software (1,289) (1,004)
- Business combinations (3,241) (1,802)
Exceptional items (9,139) 180
Group operating profit 1 5,008 13,415
Finance costs 2 (2,129) (1,641)
Finance income 2 333 974
-------------------------------
Profit before taxation 3,212 12,748
Taxation 291 (1,575)
-------------------------------
Profit for the year 3,503 11,173
-------------------------------
-------------------------------
Profit attributable to minority interest - 3
Profit attributable to equity holders of the parent 3,503 11,170
=---------------------------------------------------------------------------------------------
Earnings per share (pence)
Basic 3 9.12 30.91
Diluted 3 9.10 30.04
=---------------------------------------------------------------------------------------------
Equity - Ordinary 10p shares
Dividends (GBP'000) - Paid 4 1,295 823
Dividend per share (pence) 4 3.45 2.30
=---------------------------------------------------------------------------------------------
Dividends (GBP'000) - Proposed 4 1,172 792
Dividend per share (pence) 4 3.15 2.10
All activities are continuing.
Adjusted earnings per share is disclosed in Note 3.
Consolidated Statement of Recognised Income and Expense
2009 2008
GBP'000 GBP'000
------------- ------------
Profit for the financial year 3,503 11,173
Exchange adjustments 12,250 3,156
Cash flow hedges recognised (506) (99)
Transfer from minority interest - 16
Actuarial (loss) /gain on defined benefit pension (6,242) 5,352
schemes
Deferred taxation on actuarial loss / (gain) 1,644 (1,682)
Effect of UK tax rate change - (663)
------------- ------------
Net income recognised directly in equity 7,146 6,080
------------- ------------
Total recognised income for the financial year 10,649 17,253
------------- ------------
------------- ------------
Attributable to:
Equity shareholders 10,649 17,250
Minority interests - 3
10,649 17,253
------------- ------------
------------- ------------
Consolidated Balance Sheet as at 31 March 2009
2009 2008
Note GBP'000 GBP'000
-------------------------------------
Non-current assets
Intangible assets 46,728 45,452
Property, plant and equipment 13,477 11,142
Deferred tax asset 12,240 8,559
----------------- --------------
72,445 65,153
----------------- --------------
Current assets
Trade and other receivables 138,139 102,718
Corporation tax recoverable 1,611 1,866
Cash and cash equivalents 18,129 14,823
----------------- --------------
157,879 119,407
----------------- --------------
Current liabilities
Trade and other payables (93,788) (64,461)
Current tax liabilities (1,742) (1,694)
Borrowings (2,512) (2,696)
Provisions (8,588) (2,930)
----------------- --------------
(106,630) (71,781)
----------------- --------------
----------------- --------------
Net current assets 51,249 47,626
----------------- --------------
Non-current liabilities
Borrowings (21,346) (23,252)
Retirement benefit obligations (34,520) (27,363)
Provisions (1,748) (367)
Deferred tax liabilities (4,316) (4,111)
Other non-current liabilities (2,914) (7,952)
----------------- --------------
(64,844) (63,045)
----------------- --------------
----------------- --------------
Net assets 58,850 49,734
----------------- --------------
----------------- --------------
Equity
Called up ordinary share capital 5 3,776 3,770
Share premium 5 28,840 28,667
Retained earnings 5 13,556 15,939
Other reserves 5 12,648 1,332
----------------- --------------
Equity attributable to equity holders of the parent 58,820 49,708
Minority interest 5 30 26
----------------- --------------
Total equity 58,850 49,734
----------------- --------------
----------------- --------------
Consolidated Cash Flow Statement
2009 2008
Note GBP'000 GBP'000
------------------------------------
Cash flows from operating activities
Cash generated from operations 6(a) 19,535 4,195
Interest received 333 974
Interest paid (1,546) (1,442)
Taxation paid (2,850) (1,805)
---------------- ---------------
Net cash from operating activities 15,472 1,922
---------------- ---------------
Cash flows from investing activities
Deferred and contingent consideration paid (3,361) (1,072)
Acquisition of subsidiaries (net of cash acquired) - (16,451)
Proceeds from disposal of property, plant and equipment 264 40
(incl. software)
Purchase of minority interests - (159)
Purchase of property, plant and equipment (incl. software) (6,759) (4,067)
---------------- ---------------
Net cash used in investing activities (9,856) (21,709)
---------------- ---------------
Cash flows from financing activities
Proceeds on issue of shares 99 4,320
Employee trust purchase of own shares (654) (300)
Repayments of obligations under finance leases (1,854) (1,665)
Proceeds on issue of new borrowings 30,807 31,619
Repayment of borrowings (32,130) (17,447)
Dividends paid 4 (1,295) (823)
---------------- ---------------
Net cash (used in) / from financing activities (5,027) 15,704
---------------- ---------------
Effects of exchange rate fluctuations on cash and cash
equivalents 2,717 243
---------------- ---------------
Net increase / (decrease) in cash and cash equivalents 3,306 (3,840)
---------------- ---------------
Cash and cash equivalents at 1 April 14,823 18,663
---------------- ---------------
Cash and cash equivalents at 31 March 18,129 14,823
---------------- ---------------
---------------- ---------------
1. Segmental analysis by location of operations
Reflecting the Group's management and internal reporting structure, primary segmental information is presented within
the Financial Statements in respect of geographical segments. The Group manages its business on a global basis with
operations in three main geographical regions, UK / Europe, Asia Pacific and the Middle East. The UK is the home
country of the parent. Inter-segment revenue relates to contracts priced on an arm's length basis. The secondary
reporting format is by business segment. The Directors consider that there is only one secondary business segment,
being engineering design, planning, environmental and management consultancy. Therefore, the disclosures for the
secondary segment have already been given in these Financial Statements.
(a) Segment revenue
Inter- Total Total
segment
revenue
2009 2009 2009 2008
GBP'000 GBP'000 GBP'000 GBP'000
-----------------------------------------------------------
UK / Europe - Continuing operations 129,472 (1,257) 128,215 113,051
- Acquisitions - - - 5,191
Asia Pacific - Continuing operations 85,286 (1,451) 83,835 60,964
- Acquisitions - - - 605
Middle East - Continuing operations 117,264 (10,344) 106,920 53,183
- Acquisitions - - - 678
-----------------------------------------------------------
332,022 (13,052) 318,970 233,672
-----------------------------------------------------------
-----------------------------------------------------------
(b) Segment results
Regional operating profit
UK / Europe - Continuing operations 8,306 8,799
- Acquisitions - 946
Asia Pacific - Continuing operations 4,472 3,543
- Acquisitions - 116
Middle East - Continuing operations 8,317 4,508
- Acquisitions - 56
Corporate overheads (3,707) (2,931)
----------------------------
17,388 15,037
Amortisation of intangible assets arising on business combinations
UK / Europe - Continuing operations (1,362) (672)
- Acquisitions - (389)
Asia Pacific - Continuing operations (979) (551)
- Acquisitions - (59)
Middle East - Continuing operations (900) (79)
- Acquisitions - (52)
Exceptional items
Redundancy costs (5,031) -
Vacant property costs (3,895) -
Other (213) 180
----------------------------
(9,139) 180
----------------------------
Group operating profit 5,008 13,415
----------------------------
----------------------------
1. Segmental analysis by location of operations continued
(c) Segment assets and liabilities
UK / Europe Asia Middle Total
Pacific East
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------------------------------
2009
Segment assets 84,787 51,615 93,922 230,324
Segment liabilities (83,230) (22,891) (65,353) (171,474)
---------------------------------------------------------------
1,557 28,724 28,569 58,850
---------------------------------------------------------------
---------------------------------------------------------------
2008
Segment assets 86,181 44,215 54,164 184,560
Segment liabilities (76,068) (21,121) (37,637) (134,826)
---------------------------------------------------------------
10,113 23,094 16,527 49,734
---------------------------------------------------------------
---------------------------------------------------------------
(d) Other information
UK / Europe Asia Middle Total
Pacific East
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------------------------------
2009
Capital expenditure - property, plant & 1,329 1,408 2,231 4,968
equipment
Capital expenditure - software 1,820 314 300 2,434
Depreciation 1,479 873 1,058 3,410
Amortisation - software 782 260 247 1,289
Amortisation - business combinations 1,362 979 900 3,241
2008
Capital expenditure - property, plant & 1,236 1,426 777 3,439
equipment
Capital expenditure - software 1,644 104 480 2,228
Depreciation 1,279 616 551 2,446
Amortisation - software 666 194 144 1,004
Amortisation - business combinations 1,061 610 131 1,802
2. Net finance costs
2009 2008
GBP'000 GBP'000
---------------------------------
Bank borrowings (1,377) (1,048)
Interest expense on tax balances (22) (149)
Finance leases (148) (237)
Bond facilities - (3)
Unwinding of discounts in provisions (20) (48)
Unwinding of discounts in deferred and contingent (314) (156)
consideration
Net finance cost on pension scheme (248) -
---------------------------------
Interest payable and similar charges (2,129) (1,641)
---------------------------------
Investment interest income 268 251
Interest income received on tax refunds 65 153
Interest income received on recovered debts - 537
Interest rate financial instruments - 14
Net finance income on pension scheme - 19
---------------------------------
Interest receivable 333 974
---------------------------------
Net finance costs (1,796) (667)
---------------------------------
---------------------------------
3. Earnings per share
(a) Number of shares
2009 2008
-------------- --------------
Weighted average number of shares in issue 38,405,272 36,132,838
Effect of dilution
Share options 103,232 1,051,573
-------------- --------------
Weighted average shares (diluted) 38,508,504 37,184,411
-------------- --------------
(b) Earnings used in the calculation of earnings per share
2009 2008
GBP'000 GBP'000
-------------- --------------
Profit attributable to equity shareholders 3,503 11,170
Add back / (less) exceptional items 9,139 (180)
Add back amortisation of intangible assets on business 3,241 1,802
combinations
Less tax on adjusted items (2,459) (386)
-------------- --------------
Adjusted earnings 13,424 12,406
-------------- --------------
-------------- --------------
(c) Earnings per share
2009 2008
Pence Pence
-------------- --------------
Basic earnings per share 9.12 30.91
Add back / (less) exceptional items 23.80 (0.50)
Add back amortisation of intangible assets and business 8.44 4.99
combinations
Add back tax on adjusted items (6.40) (1.07)
-------------- --------------
Adjusted basic earnings per share 34.96 34.33
-------------- --------------
-------------- --------------
2009 2008
Pence Pence
-------------- --------------
Diluted earnings per share 9.10 30.04
Add back / (less) exceptional items 23.73 (0.48)
Add back amortisation of intangible assets and business 8.42 4.84
combinations
Add back tax on adjusted items (6.38) (1.04)
-------------- --------------
Adjusted diluted earnings per share 34.87 33.36
-------------- --------------
-------------- --------------
4. Dividends
2009 2008
GBP'000 GBP'000
----------------------------------
Dividends charged to equity in the year 1,295 823
-------------- --------------
-------------- --------------
Equity - Per Ordinary 10p share
Final dividend paid (pence) 2.10 1.40
Interim dividend paid (pence) 1.35 0.90
The directors are proposing a final dividend of 3.15 pence per share (2008: 2.10 pence). In
accordance with IFRS the dividend has not been recognised in the Financial Statements but if
approved by shareholders will be paid on 7 August 2009 to shareholders on the register as at 10
July 2009.
5. Shareholders' funds and statement of changes in shareholders' equity
Share Share Retained Fair Total Minority Total
capital premium earnings value and interests
other
reserves
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
=----------------------------------------------------------------------------------------------------------------
At 1 April 2007 3,585 21,262 2,437 (1,592) 25,692 242 25,934
New shares issued 185 - - - 185 - 185
Premium on new shares issued - 7,405 - - 7,405 - 7,405
Profit for the year - - 11,170 - 11,170 3 11,173
Dividends paid - - (823) - (823) - (823)
Actuarial gains on defined benefit
pension schemes - - 5,352 - 5,352 - 5,352
Deferred tax on actuarial gains - - (1,682) - (1,682) - (1,682)
Effect of UK tax rate change - - (663) - (663) - (663)
Share option charges - - 179 - 179 - 179
Deferred tax on share option - - (47) - (47) - (47)
charges
Cash flow hedges recognised - - - (99) (99) - (99)
Incentives granted in the year - - - (300) (300) - (300)
Charge for the year - - - 167 167 - 167
Minority interest acquired - - - - - (195) (195)
Transfer to retained earnings - - 16 - 16 (16) -
Exchange adjustments - - - 3,156 3,156 (8) 3,148
---------------------------------------------------------------------------
At 31 March 2008 3,770 28,667 15,939 1,332 49,708 26 49,734
New shares issued 6 - - - 6 - 6
Premium on new shares issued - 173 - - 173 - 173
Profit for the year - - 3,503 - 3,503 - 3,503
Dividends paid - - (1,295) - (1,295) - (1,295)
Actuarial losses on defined benefit
pension schemes - - (6,242) - (6,242) - (6,242)
Deferred tax on actuarial losses - - 1,644 - 1,644 - 1,644
Share option charges - - 10 - 10 - 10
Deferred tax on share option - - (3) - (3) - (3)
charges
Cash flow hedges recognised - - - (506) (506) - (506)
Incentives granted in year - - - (653) (653) - (653)
Charge for the year - - - 225 225 - 225
Exchange adjustments - - - 12,250 12,250 4 12,254
---------------------------------------------------------------------------
At 31 March 2009 3,776 28,840 13,556 12,648 58,820 30 58,850
---------------------------------------------------------------------------
---------------------------------------------------------------------------
6. Notes to the Consolidated Cash Flow Statement
(a) Cash flows from operating activities
2009 2008
GBP'000 GBP'000
----------------------
Profit for the financial year 3,503 11,173
Adjustments for:
Taxation (291) 1,575
Depreciation 3,410 2,446
Loss on disposal of property, plant and equipment 57 -
Amortisation - Software 1,289 1,004
Amortisation - Business Combinations 3,241 1,802
Interest receivable (333) (974)
Interest payable and similar charges 2,129 1,641
Fair value gain on financial 239 (476)
instruments
Share option costs 323 388
Increase / (decrease) in provisions 7,039 (306)
Defined benefit scheme charges 4,877 2,598
Pension scheme curtailments (766) -
Pension scheme settlements - (350)
Contributions to defined benefit (5,080) (6,012)
schemes
Changes in working capital (excluding effects of acquisitions):
Increase in trade and other (32,522) (12,916)
receivables
Increase in trade and other payables 32,420 2,602
----------------------
Cash generated from operations 19,535 4,195
----------------------
----------------------
(b) Reconciliation of movement in net funds /(debt)
At 1 At 31
April Non Cash Exchange March
2008 Cash flow Movement Movement 2009
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------------------
Cash at bank 14,823 589 - 2,717 18,129
------------------------------------------------------------
Debt due within 1 year (1,105) 284 (584) (96) (1,501)
Debt due after 1 year (21,741) 1,039 584 (120) (20,238)
Finance leases due within 1 year (1,591) 1,854 (1,101) (173) (1,011)
Finance leases due after 1 year (1,511) - 456 (53) (1,108)
------------------------------------------------------------
(25,948) 3,177 (645) (442) (23,858)
------------------------------------------------------------
(11,125) 3,766 (645) 2,275 (5,729)
------------------------------------------------------------
------------------------------------------------------------
7. Related Party Transactions
The Group have entered into transactions on an arm's length basis with related parties, mostly joint
arrangements, during the year. Transactions relating to sales of consulting services to these joint
arrangements amounted to GBP13.0m (2008: GBP13.9m).
Net amounts due from these joint arrangements amounted to GBP3.6m (2008: GBP2.4m), and are included
within trade receivables, as the Group utilises these arrangements primarily as special purpose
billing vehicles on project related ventures with our partners. A listing of significant joint
arrangements is set out below:
Legal status Country of incorporation
/ Region of operation
------------------------------------------------------
McCarthy Hyder Consultants Limited(i) Incorporated Republic of Ireland
Hyder Halcrow JV Unincorporated UK / Europe
Maunsell Hyder JV Unincorporated Asia Pacific
Hyder Atkins JV Unincorporated Middle East
(i) The Group holds a 50% interest in the joint arrangement's ordinary share capital.
Unincorporated joint arrangements are normally operated from the relevant Hyder regional office.
8. Financial information
The information within this annual results announcement does not constitute statutory accounts within the meaning
of section 240 of the Companies Act 1985. The statutory accounts for the financial year ended 31 March 2009 will
be delivered to the Registrar of Companies following the Company's Annual General Meeting. The auditors have
indicated their intention to give an unqualified report which will not contain an emphasis of matter paragraph or
any statement under section 237 (2) or (3) of the Companies Act 1985.
The Company's Annual Report and Accounts for the financial year ending 31 March 2009 is expected to be posted to
shareholders on 23 June 2009 and will be available for viewing on the Company's website at www.hyderconsulting.com
thereafter.
9. Responsibility Statement
The Directors confirm that to the best of their knowledge:
* the financial statements within this annual results announcement, prepared in accordance with International
Financial Reporting Standards, give a true and fair view of the assets, liabilities, financial position and
profit or loss of the Company and the undertakings included in the consolidation taken as a whole;
* the management report, within this annual results announcement, includes a fair review of the development
and performance of the business and the position of the Company and the undertakings included in the
consolidation taken as a whole, together with a description of the principal risks and uncertainties that
they face.
10. Cautionary Statement
This report contains certain forward-looking statements with respect to the financial condition, performance,
results, strategy and objectives, operations and businesses of the Group. By their nature, these statements
involve uncertainty because they relate to future events and circumstances which are beyond the Group's control.
As a result the Group's actual future financial condition, performance and results may differ materially from the
plans or expectations expressed or implied within any forward-looking statement. Any forward-looking statements
reflect knowledge and information available at the date of preparation of this report and the Company assumes no
obligation to update or revise any forward-looking statement, resulting from new information, future events or
otherwise. Nothing in this report should be construed as a profit forecast.
Non- Statutory Information - Summary of Five Year Trading Results
The following information is illustrative only and does not form part of the Financial Statements.
31 March 31 March 31 March 31 March 31 March
2009 2008 2007 2006 2005
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------------------------
Consolidated Income Statement
Revenue 318,970 233,672 203,145 171,314 136,233
Net Revenue 269,903 196,907 167,445 139,213 112,858
Operating profit before 17,388 15,037 11,401 8,380 4,714
amortisation and other
adjustments
Amortisation of goodwill and (3,241) (1,802) (1,407) (671) 351
intangibles
Exceptional items and other adjustments (9,139) 180 4,338 2,057 (318)
----------------------------------------------------------
Profit before interest and 5,008 13,415 14,332 9,766 4,747
taxation
Net finance costs (1,796) (667) (983) (1,427) (2,154)
----------------------------------------------------------
Profit before taxation 3,212 12,748 13,349 8,339 2,593
----------------------------------------------------------
----------------------------------------------------------
=-------------------------------------------------------------------------------------------------------
Consolidated Balance Sheet
Goodwill and other intangibles 46,728 45,452 18,046 12,332 6,275
Fixed assets 13,477 11,142 9,443 8,364 6,830
Deferred tax 12,240 8,559 12,560 15,171 10,730
Current assets 157,879 119,407 96,671 81,171 62,232
----------------------------------------------------------
230,324 184,560 136,720 117,038 86,067
Current financial liabilities and trade
payables (106,630) (71,781) (63,471) (54,213) (34,005)
----------------------------------------------------------
Total assets less current 123,694 112,779 73,249 62,825 52,062
liabilities
Non-current liabilities and
provisions (64,844) (63,045) (47,315) (54,874) (45,249)
----------------------------------------------------------
Net assets 58,850 49,734 25,934 7,951 6,813
----------------------------------------------------------
----------------------------------------------------------
Called up share capital 3,776 3,770 3,585 3,266 3,233
Share premium account 28,840 28,667 21,262 12,515 11,701
Retained earnings 13,556 15,939 2,437 (8,232) (7,945)
Other reserves 12,648 1,332 (1,592) 72 (315)
----------------------------------------------------------
Total shareholders' equity 58,820 49,708 25,692 7,621 6,674
Minority interests in equity 30 26 242 330 139
----------------------------------------------------------
Total equity 58,850 49,734 25,934 7,951 6,813
----------------------------------------------------------
----------------------------------------------------------
=-------------------------------------------------------------------------------------------------------
Statistics
Adjusted net operating margin % 6.44 7.63 6.81 6.02 4.18
Adjusted diluted earnings per p 34.87 33.36 26.49 18.86 7.86
share
Basic earnings per share p 9.12 30.91 32.44 21.44 8.14
Dividends per ordinary share p 4.50 3.00 2.00 1.25 0.75
Average number of employees Number 4,643 4,257 3,798 3,203 2,864
Net (debt) / funds GBP'000 (5,729) (11,125) 8,221 6,214 4,451
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