Riyadh Metro, one of Atkins’ two big transport schemes in the Gulf (Source: YouTube)

Companies

Atkins results buoyed by nuclear demand and Middle Eastern metros

11 June 2015 | By David Rogers | 0 Comments

Atkins’ full year results to 31 March has shown a flat turnover of $2.8bn but a 4% increase in operating profit, from $177m to $184m.

Profit after tax fell 11% from $149m to $133m. However, the company’s underlying profit rose 15%, from $164m to $189m.

In his presentation of the results, Uwe Krueger, the firm’s chief executive, stressed the progress Atkins had made towards reaching its goal of an 8% profit margin. In the latest results it stands at 7.6% compared with 6.7% the year before.

We benefited from our new focus on transport, infrastructure and property. We are focusing on Saudi Arabia, the Emirates and Qatar– Uwe Krueger, chief executive

“If you look at the last half year of our performance, our margin was at 8.7% so that’s clearly very significant,” he said.

In terms of geographical areas, revenue fell by about 10% in the UK and Europe, where the firm does most of its business. 

There was strong growth in the Middle East, where turnover rose 29% from $260m to $336m.

Krueger said: “This has a very, very strong year. We performed well on the two projects that are still continuing – the Riyadh Metro and the Doha Red Line. We benefited also from our new focus on transport, infrastructure and property. And we are focusing on Saudi Arabia, the Emirates and Qatar.”

Regarding Asia Pacific, he said the company had done well in its traditional base of Hong Kong, has consolidated its position in China and had expanded into South-east Asia as a result of its developing relationship with Chinese contractors. 

Revenue in this region grew 9%, from $157m to $171m and profit increased 23% from $12m to $16m. Atkins is expecting growth here to be hit by slowing demand in mainland China over the next six months. 

In North America, Krueger said Atkins had a “transformational year”. 

“We decided on a substantial reorganisation,” he said. “At the core of it was the Technical Professional Operation which units such as strategic ventures, transport and public and private. We are growing in the US and we have been strong in transportation in Georgia, Texas, Florida and Colorado.”

Turnover fell by 10% in North America, although profit in this region actually increased from $29m to $31m.

Krueger added that the performance of Atkins global design centre in Bangalore had been a factor in delivering major projects. 

The best performing sector was energy: Atkins’ profit rose 35% here, from $23m to $31m, with a surge in demand for nuclear work and a good performance in the renewables sector offsetting a decline in capital expenditure by oil and gas companies. 

The firm made two acquisitions in the energy sector: Houston Offshore Engineering and Nuclear Safety Associates.