Hyder Consulting PLC Annual Report 2012

Hyder Consulting PLC 

Annual Report 2012

Cover image: West Gate Bridge, Australia. 

Hyder Consulting PLC Annual Report 2012

Contents 

1 

Company 

Overview 

42 

Corporate Social 

Responsibility 

10 

Chairman’s 

Statement 

59 

General 

Information and 

Disclosures 

13 

Directors’ 

Report 

64 

Directors’ 

Remuneration 


13 

Business 

Review 

72 

Independent 

Auditors’ 


32 

35 

Directors and 

Advisors 

Corporate 

Governance 

73 

117 

Consolidated 

Financial 

Statements and 

Notes 


(Company) Financial 

Statements 

Hyder Consulting PLC Annual Report 2012

Our strategy 

Our aim is to be the trusted 

partner of valued clients 

creating exceptional solutions 

worldwide. 

Our vision is to be the next 

evolution in design and 

engineering consultancy. 

Overview: 

Our strategy is to offer core services to 

key clients; operating in geographies 

where market dynamics, our long 

established track record, and our 

professional expertise differentiate us 

from our competitors. 

We are differentiated through our 

ability to provide technical excellence 

from design teams located local to 

and remote from the client. By taking 

advantage of our common business 

systems, we can rapidly mobilise 

tailored design teams and collaborate 

geographically to solve client needs 

across our multinational network. 

We operate three design excellence 

centres to support our client facing 

operations in our five regions: a 

long-established design centre in 

the Philippines which undertakes 

the design of highways and property 

projects, a centre in India for the 

design of utility and rail projects, and 

a third centre in Bulgaria opened in 

2011 to support our German business. 

These centres now employ over 300 

people (8% of group headcount) and 

provide access to a pool of qualified 

engineering resources at a lower cost 

than in certain of our end markets. 

We anticipate further growth in these 

design excellence centres in the year 

ahead. 

We want to expand both organically 

and through strategic acquisitions 

which will enhance our professional 

expertise and competitiveness in core 

markets and sectors. During the year 

we have completed three strategic 

acquisitions in attractive markets 

and geographies: ESR Technology, an 

energy business in the UK, the SAK 

infrastructure business in Saudi Arabia, 

and GW Engineers in Australia which 

operates in the resources sector. 

Our strategy is underpinned by our 

determination to achieve a common 

culture and shared values with our 

people, clients and the communities in 

which we operate. 

By adhering to a common strategy and 

clear direction across the group, Hyder 

is now well positioned in its chosen 

markets with selected key clients. 

Hyder Consulting PLC Annual Report 2012 1

Our strategy continued 

Who we are: 

Hyder is a leading multinational design and 

engineering consultancy offering infrastructure, 

property, and environmental solutions. 

As one of the world’s longest established 

engineering consultancies, with a 150 year 

heritage, we have created landmark designs 

across the globe including the Sydney Harbour 

Bridge, the Cairo wastewater scheme and 

London’s Tower Bridge amongst many others. 

Whilst our history dates back more than 150 

years, in recent years we have designed the 

world’s tallest building, Burj Khalifa, Australia’s 

Go Between Bridge, Qatar’s Capital Market 

Tower, Frankfurt Airport’s new runway, Taiwan’s 

high speed rail network, and undertaken 

landscaping work on the ‘greening’ of Hong 

Kong. 

Where we operate: 

We have client facing offices in our five regional 

centres; the UK, Germany, the Middle East, Asia 

and Australia. We have been operating as a 

multinational for over a century outside the UK 

with more than 100 years experience in China, 

80 years in Germany, 70 years in Australia and 50 

years in the Middle East. 

We also operate three design excellence centres 

to support our client facing operations in the 

five regions: a long-established design centre in 

the Philippines which undertakes the design of 

highways and property projects, a centre in India 

for the design of utility and rail projects, and a 

third centre in Bulgaria opened in 2011 to support 

our German business. 

These design excellence centres provide the group 

with access to a pool of qualified engineering 

resources. 

Germany 

UK 

Bulgaria 

Asia 

Philippines 

Middle East 

India 

Australia 

Client facing market 

Design excellence centre 

2 Hyder Consulting PLC Annual Report 2012

Our markets: 

Our extensive regional and local expertise is currently managed through four sectors; transport, utilities, 

property, and environment. We are investing both organically and through acquisition in building skills 

and capabilities in two new emerging sectors: energy and resources. 

Our market sectors are underpinned by four strong global growth drivers – 

• urbanisation, including rural populations in Asia 

• mass transit, with increased investment in rail/metro schemes 

• climate change, driving low carbon design 

• water and power scarcity. 

We strive to utilise our understanding and expertise of these sectors and create innovative solutions 

for the social and commercial benefit of our clients in line with their priorities. Our approach also 

encompasses the highest quality standards and a continuous drive for technical excellence. 

Property 

Transport 

Utilities 

Environment 

Energy 

Resources 



Our structure: 

Our business is managed regionally through locally based and empowered management teams who not only 

understand their local culture and markets, but also have insights into client pressures and opportunities. 

Our five regions are led by managing directors who are all local to their respective regions benefiting from 

local knowledge, client relationships and experience. Each regional managing director sits on the group 

executive board. The executive board also comprises the chief executive, group finance director, commercial 

and major bids director, group technical director and the human resources and communications director. 

Our people: 

We want to combine the professional 

expertise and multi-disciplinary 

experience of our people from across the 

group. Hyder’s people are empowered 

to provide a comprehensive range of 

planning, engineering, environmental and 

management consultancy services. 

As a reflection of our multinational 

approach, we employ local qualified staff 

together with a mix of international experts. 

Our people are motivated to enhance their 

careers by working on projects around the 

world, and to share their expertise across 

sectors. We invest in coaching, training 

and personal development for our people, 

and strive to work together to achieve high 

levels of performance and engagement. 


Our client-centred approach: 

We view our clients as valued partners and 

seek to build trust and develop partnershipstyle 

relationships with key clients. We strive 

to differentiate our services in three ways: 

• tailoring our services and 

implementation to meet the specialist 

needs of our key clients – striving for 

excellence as defined by them and not 

by us 

• developing unique skills, design tools 

and capabilities to enhance 

the commercial advantage of our key 

clients 

• we seek from within the group new 

ideas and solutions to problems faced by 

our clients. 

Our investment of company resources to grow 

our market position, order book and revenue 

is a reflection of the proactive approach we 

take to client development in both existing 

and targeted new key client accounts. 



Our strategy is underpinned by our corporate values: 

Client focus 

we differentiate through our 

tailored skills and depth of 

client understanding. 

Excellence 

we strive for excellence, 

recognising that excellence 

is defined by our clients. 

People 

we create the environment 

for people to realise their full 

potential. 


we take responsibility for our 

performance and for safety. 

Trust 

we build and retain relationships 

of trust with our clients, 

colleagues and business partners. 

Teamwork 

we work together as a team for 

the group not just the individual. 


Awards - received in the year 

We have won more awards this year, including the following: 

• The Queen’s Award for Enterprise: International Trade 

2011 

• The Hong Kong Institute of Landscape Architects: 

Merit Award for project - Siu Sai Wan Complex, Hong 

Kong 

• ROSPA Gold Medal Award 2011: Our ninth gold medal 

for our sustained achievement in health and safety 

performance in the UK 

• Engineers Australia (Queensland Division): Project 

infrastructure over $50 million - Go Between Bridge 

• The Construction Week Architect Awards 2011: Highly 

commended for sustainable design of the year - The Palm 

Jumeirah, Dubai, UAE 

• SAI Global OHS Systems Awards: OHS Systems 

Excellence Australia 

• The Big Project Award 2011: Best Water Conservation 

Initiative - Winner, “Luftkissendüker Pforzheim” 

• 10th Tien-Yow Jeme Award 2011: Winner, Lai Chi Ko 

Viaduct (section of the Tsing Sha Highway) 

• FTSE4Good Index Series: Certificate of Membership, 

meeting globally recognised standards of responsible 

business practice 

• Engineers Australia (Queensland Division): Project 

management - Go Between Bridge 

• Thames Water 2011 Award for Excellence: Health & 

Safety performance 

• Designer of Excellence: Forte Land Real Estate, 

Jonathan King (ACLA) 

• CEEQUAL: Whole project award ‘Excellent’ 81.6% - M40 

Junction 15 Improvement Scheme 

• Consult Australia Awards for Excellence: Transport 

and Civil - West Gate Freeway Alliance, Certificate of 

recognition 

• Kempen/SNS SRI Universe: Commended, for our 

business ethics, social performance and environmental 

performance 

• Consult Australia Awards for Excellence: APP Client of 

choice - Winner 

• Chartered Institute of Logistics and Transport: Young 

professional of the year - Laura Norman 

• Constructing Excellence in Wales: Project of the year - 

A40 Penblewin to Slebech Park Improvements 

• Consult Australia Awards for Excellence: Building 

Services - Cochlear Global HQ Silver Award (highest in 

the category) 

• German Society for Trenchless Technology GSTT: 

Outstanding projects - Winner, innovative infrastructure 

project “Luftkissendüker Pforzheim” (in consortium with 

Sonntag Bau) 

• CEEQUAL: Interim client and outline design award 

‘Excellent’ 87.3% - A477 St Clears to Red Roses 

Improvement 

• RTPI Cymru Planning Awards - Commendation: RCT 

Homes Open Spaces Project 

• National Rail Awards: Project of the year- North 

London Railway Infrastructure Project (TfL and 

Network Rail accepted the award Hyder was the 

supplier to Carillion) 

• IHT ‘Large Highway and Transportation project 

2011’: M40 - J15 project 

• Young consultant of the year ACE/NCE Awards 

2011: Outstanding achievement - Pete Harrison a 

finalist (NW Bicester eco-development) 

• CEEQUAL Award: Achieved ‘Excellent’ 79.3% - A2 

Maydown to city of Derry Airport 

• Michelmores and Western Morning News 

Commercial Property Awards: Project of the year - 

South Devon College 

• Construction only Award: Lee Valley White Water 

Canoe Centre 

• CEEQUAL: CQA179 - A2 Maydown to City of Derry 

Airport 

Stratford Mine, Australia 


Key Performance Indicators 

2012 2011 change 

Order book (£m) 362.8 312.3 16.2% 

Revenue (£m) 277.3 290.3 (4.5%) 

Adjusted operating profit* (£m) 21.0 20.3 3.4% 

Adjusted operating profit margin* (%) 7.6 7.0 8.6% 

Adjusted net operating margin* (%) 8.7 8.1 7.4% 

Profit before tax (£m) 17.6 18.2 (3.3%) 

Adjusted diluted EPS* (p) 44.34 43.34 2.3% 

Dividend per share (p) 9.0 7.75 16.1% 

Net cash (£m) 15.6 13.1 19.1% 

*Adjusted numbers exclude amortisation of acquired intangibles, acquisition costs and exceptional items 

Inner West 

Busway, 

Australia 


Regional Key Performance Indicators 

Revenue (£m) Adjusted operating profit *(£m) 

2012 2011 2012 2011 

Australia 90.2 91.8 13.8 13.9 

Asia 22.1 22.2 0.9 0.5 

Middle East 63.8 65.5 3.9 2.6 

UK 75.0 87.2 4.0 5.5 

Germany 26.2 23.6 1.5 1.1 

*Adjusted numbers exclude amortisation of acquired intangibles, acquisition costs and exceptional items 

Employee numbers 

UK Germany Asia 

Middle 

East 

Australia 

31 March 2012 1,084 404 457 1,110 719 

31 March 2011 1,139 366 433 1,026 733 

Average 2012 1,118 405 442 1,036 670 

Average 2011 1,204 371 436 1,072 776 


Chairman’s Statement 

“I am pleased to report 

another good set of 

results in what have been 

mixed market conditions.” 

Sir Alan Thomas, Chairman 

Results 

The order book increased substantially to £362.8m (2011: 

£312.3m) following a number of large and important contract 

awards in the second half year. Approximately 60% of the 

current year’s forecast revenue is in the order book. 

Revenue amounted to £277.3m (2011: £290.3m); net revenue, 

after deduction of sub-consultant costs, was £241.8m (2011: 

£251.4m). 

Adjusted operating profit was £21.0m (2011: £20.3m), after 

absorbing £1.5m of redundancy costs (2011: £2.9m), and after 

foreign currency translation gains of £0.9m. The adjusted net 

operating profit margin grew to 8.7% (2011: 8.1%). During 

the year exceptional costs of £1.5m were incurred (2011: £Nil) 

in relation to (i) vacant properties in the UK (£1.3m) and (ii) 

the closure of the UK defined benefit scheme to future accrual 

(£0.2m). Operating profit was £17.1m (2011: £18.2m). 

Adjusted profit before tax rose to £21.6m (2011: £20.3m). 

Profit before tax was £17.6m (2011: £18.2m). 

Adjusted diluted earnings per share increased to 44.34p (2011: 

43.34p). Diluted earnings per share were 35.96p (2011: 38.63p). 

Funding 

At 31 March 2012 the group had net cash of £15.6m (2011: 

£13.1m). Cash balances at the year end amounted to 

£23.2m with unutilised facilities of £45.8m. 

Operating cash flow was £15.6m (2011: £19.2m), after 

making contributions of £3.9m towards the pension deficit 

(2011: £3.0m). Cash conversion for the year was 76% before 

accounting for these contributions, reflecting the greater 

working capital requirements of the Middle East operations 

where our order book has grown significantly. 

The UK pension scheme was closed to future accrual on 30 

April 2011. At 31 March 2012 the deficit had reduced to 

£16.3m (2011: £17.3m). 

We look to expand both organically and through strategic 

acquisitions which will enhance our professional expertise 

and competitiveness in core markets and sectors. We 

completed three acquisitions during the year at a net 

cost of £2.5m; ESR Technology, a specialist energy, water 

and space consultant operating in the UK and Abu Dhabi; 

SAK infrastructure consultants in Saudi Arabia; and GW 

Engineers, a resources consultancy in Australia. All three are 

performing well. 

Dividend 

In recognition of the group’s financial performance, the 

board proposes an increase in the final dividend to 7.00p per 

share (2011: 6.00p). The full year dividend amounts to 9.00p 

per share (2011: 7.75p), an increase of 16.1% this year and 

a doubling over the last three years. The full year dividend 

is covered 4.9 times by adjusted diluted earnings per share 

(2011: 5.6 times). 


Operating highlights 

Westfield 

Shopping, 

Sydney, 

Australia 

Asia-Pacific 

Regional revenues were £112.2m (2011: £114.0m); 

adjusted operating profits were £14.7m (2011: 

£14.4m). 

In Australia, our transport division performed well in the 

second half. We have secured significant new highway 

and rail contracts, and continued to work successfully on 

a number of Alliance contracts. Our commercial property 

division completed work on the Sydney Centrepoint 

development which was opened during the year; market 

conditions remain subdued and competitive. We have grown 

our resources business organically and acquired a local 

resources consultancy, GW Engineers. We are confident of 

good growth in this market in the coming year. In China and 

Vietnam we have invested in growing our geographical and 

market presence, including the opening of a new office in 

Chongqing, China. 

Middle East 

Revenue was £63.8m (2011: £65.5m); adjusted 

operating profits increased by 50.0% to £3.9m 

(2011: £2.6m). 

Results have improved as work begins on new contracts and 

our investment in key clients comes to fruition. In Qatar we 

have secured important projects with Ashghal, Kahramaa and 

Qatar Metro as part of the country’s 2030 infrastructure 

development goals and in preparation for the 2022 FIFA 

World Cup. In Saudi Arabia we have recently completed 

the acquisition of SAK, building our market presence and 

increasing our exposure to the growing infrastructure 

market there. We have already started benefitting from 

this increased presence in the Kingdom through the recent 

award of a three year advisory commission from Jeddah 

Municipality. Elsewhere we have undertaken major utilities 

projects including Step Tunnel in Abu Dhabi and Muharraq 

waste water treatment works in Bahrain. 

Europe 

Revenue was £101.2m (2011: £110.8m); adjusted 

operating profits were £5.5m (2011: £6.6m). 

In the UK we have grown our rail business in a competitive 

market and have been appointed designers on London 

Bridge station, undertaken further work for Crossrail, and 

implemented platform extension works for Network Rail. 

The highways market has been particularly challenging 

with lower workload which affected utilisation rates. 

More recently we have won a number of projects with the 

Highways Agency under framework agreements. Results in 

the utilities sector have improved as workload has built up 

during the AMP5 programme. In Germany results are ahead 

of last year, with Ingenieur Consult, and our industrial 

property business performing ahead of expectations. 

Dubai Yacht 

Club, CMA Tower, 

Emirates Towers, 

Middle East 


Chairman’s Statement continued 

M25, UK 

People 

We now employ 3,774 people across our regions, an increase 

of 2.1% on the previous year. We have increased headcount 

in the Middle East by 8.2% as our workload there has grown, 

offset by a reduction in numbers in the challenging UK 

market. 

After a period of restructuring we have given particular 

attention to the training and development of our people 

and, where practical, provide them with opportunities 

to gain experience in different geographies and sectors, 

thereby strengthening the skills base and widening 

opportunity. 

Outlook 

The large proportion of our revenues and profits earned 

overseas has enabled the group to perform well in mixed market 

conditions. Hyder’s strong order book, balance sheet and 

prospective opportunities give us confidence for the year ahead. 

I would like to express our appreciation to our clients for 

their confidence in us and to thank every member of Hyder’s 

staff for their efforts and for their contribution to another 

year of strong results. 

Sir Alan Thomas 

Chairman 

13 June 2012 

Northparkes 

Mine and 

Stratford Mine, 

Australia 


Directors’ 


Business 

Review 


Directors’ Report Business Review continued 

Hyder is a leading 

multinational design and 

engineering consultancy 

with a 150 year heritage. 

Our business is managed 

through three primary regions: 

Asia-Pacific (Australia and 

Asia), the Middle East, and 

Europe (UK and Germany). 

Fraport, 

Frankfurt, 

Germany 


Asia-Pacific 

Regional revenues were £112.3m (2011: £114.0m) and 

adjusted operating profit £14.7m (2011: £14.4m), although 

the latter was 5.4% lower on a constant currency basis after 

absorbing £0.5m of redundancy costs. 

Australia 

Our results improved in the second half year following the 

award of infrastructure projects which had previously been 

delayed as a result of state elections and the effect of the 

Queensland flooding. 

Our transport division has performed particularly well in 

the second half following major project wins including two 

sections of the Pacific Highway upgrade; from Titenbar 

to Ewingsdale, and Oxsley to Kempsey, and the Southern 

Expressway in Adelaide. We have continued to work on 

Alliance contracts for the M80 motorway in Victoria, and 

the Hunter Expressway in New South Wales which have 

again contributed to the good results. The Westgate 

Freeway Upgrade Alliance in Melbourne, completed in the 

last financial year, was awarded the Australian construction 

achievement award. We have invested in developing our rail 

business and recently started work on a significant regional 

rail link project in Melbourne. 

In the property sector we successfully completed our work 

on the Eclipse Tower and Centrepoint Tower in Sydney, and 

the Hilton Hotel on the Gold Coast. We have secured new 

work on the Eastland’s shopping centre in Melbourne and 

the Fiona Stanley hospital in Perth. Though the private 

property sector remains subdued, the division is working 

with clients in the resources sector, completing several 

townships and mining camps for Alpha Coal, among others. 

Our utilities business has grown and we are now working 

on projects across Australia. We have won important new 

projects in the Queensland coal seam gas sector. 

Following recent project awards our forward order book has 

increased to £58.1m, up 21.8% from £47.7m the previous year. 

This combined with the recent acquisition of GW Engineers in 

the resources sector positions us well for the year ahead. 

Asia 

In Hong Kong, we have secured further Greening Master Plan 

projects in the New Territories, and a framework contract for 

the Hong Kong housing association. In mainland China our 

revenue has grown, and we have invested in growing our market 

presence opening a new office in Chongqing during the year. 

Major projects: 

• Regional Rail Link package E, Australia 

• Southern Expressway, Adelaide, Australia 

• Pacific Highway Upgrade, Oxley highway to Kempsey, 

Australia 

• Titenbar to Ewingsdale Upgrade, Australia 

• Kenya North coal seam gas projects, Australia 

• Eastland’s shopping centre, Melbourne, Australia 

• Fiona Stanley hospital, Perth, Australia 

• Alpha Coal village and rail camps design, Australia 

• Greening Master lans, New Territories, Hong Kong 

• Hong Kong Housing Authority slope maintenance term 

consultancy, Hong Kong 

2012 2011 

Australia Asia Total Australia Asia Total 

Revenue (£m) 90.2 22.1 112.3 91.8 22.2 114.0 

Adjusted operating 

profit (£m) 

13.8 0.9 14.7 13.9 0.5 14.4 

Margin 15.3% 4.1% 13.1% 15.1% 2.3% 12.6% 

Order book (£m) 58.1 34.5 92.6 47.7 29.7 77.4 

People 719 457 1,176 733 433 1,166 



Middle East 

Regional revenues were £63.8m (2011: £65.5m), up 0.3% 

on a constant currency basis. Adjusted operating profits 

increased 50.0% to £3.9m (2011: £2.6m), after absorbing 

£0.3m of redundancy costs. 

We have opened new and larger offices in Qatar and Saudi 

Arabia, which are investing heavily in new infrastructure 

programmes for our key clients. This investment temporarily 

suppressed margins, but led to improved profitability in 

the second half, and our order book increased by 34.1% to 

£135.2m (2011: £100.8m). In the second half of the year, 

we were awarded a number of large new contracts in Qatar 

with Ashghal, to undertake all infrastructure design and 

supervision services for a 75 square kilometre area north 

of Doha over the next five years, and with Kahramaa, 

to design a number of mega reservoirs to increase the 

security of water supply. In Saudi Arabia, following the 

recent acquisition of SAK, we have recently secured a 

framework contract with Jeddah Municipality to provide 

engineering consultancy services for the next three years. 

The acquisition is integrating well and providing new 

opportunities for the group in the Kingdom. 

We have grown our rail expertise in the region during the 

year and particularly in Qatar as the country develops new 

schemes in advance of the 2022 FIFA World Cup. We are 

currently working on a number of tender design packages for 

Qatar Metro. 

Working capital in the region has increased slightly over the 

year due to slower payment terms with public sector clients 

on new contracts in Qatar and Saudi Arabia. We have 

received £7.9m from a client in Qatar subsequent to the year 

end, and made good progress in resolving delayed contract 

settlements in the region. 


• Ashghal contract 2, Qatar 

• Kahramaa mega reservoirs, Qatar 

• Qatar Metro tender design, Qatar 

• Qatar Integrated Rail Programme, Qatar 

• Bright Start Resort, Dubai 

• Hydraulic network modelling, Abu Dhabi 

• Jeddah municipality engineering consultancy services 

framework, Saudi Arabia 


Revenue (£m) 63.8 65.5 

Adjusted operating profit (£m) 3.9 2.6 

Margin 6.1% 4.0% 

Order book (£m) 135.2 100.8 

People 1,110 1,026 

Scada Automation 

of Treated Sewage 

Effluent (TSE) 

System, Qatar 

Abu Dhabi Sewerage 

Scheme, UAE 


Europe 

Regional revenues were 8.7% lower at £101.2m (2011: 

£110.8m). Adjusted operating profits were £5.5m (2011: 

£6.6m), 16.7% lower reflecting the challenging market 

conditions in the UK. 

UK 

In the UK, we have performed well in what has been a 

competitive rail market, winning new contracts with 

Crossrail, TfL, Network Rail, and for London Bridge station 

with Costain. In the highways sector whilst we had 

secured new frameworks with the Highways Agency at the 

end of the prior year, workload was slow in the first half 

which affected utilisation rates. Later in the year we won 

a number of commissions under framework agreements 

including design works on the managed motorway delivery 

hub and site assurance works. 

We have been appointed sole provider of consultancy 

services to British Waterways under a framework agreement. 

This supplements our work in the water sector, notably on 

AMP5 frameworks with South West Water, Thames Water 

and Severn Trent Water. In addition, we have continued to 

support Thames Water in damage assessment and mitigation 

measures relating to those assets critical to the supply of 

energy and water-related utilities which will be affected 

by Crossrail’s tunnels and stations, and by the proposed 

Thames Tunnel. We are continuing to support major Thames 

Tideway upgrade projects at Crossness and Beckton sewage 

treatment works. Our profile in the utilities sector continues 

to grow as a result of these important project awards. 

In the property and environment sectors, the market 

has been subdued, although we have been appointed to 

frameworks in both existing and new market segments, 

including with the National Grid. Planning applications were 

approved on substantial Infrastructure Planning Commission 

and urban regeneration schemes, which will provide good 

future workload. 

Germany 

Operating profits improved, and we carried out assignments 

for a number of Hyder’s key accounts including Siemens, 

BMW, Hochtief and Deutsche Bahn, the latter on the ICE 

high speed rail, section 21. Our international presence is 

giving us opportunities to work with these clients outside 

Germany, for example in Qatar and in China, and in the 

rail sector more widely. Our property division performed 

particularly well during the year and Ingenieur Consult, 

which we acquired last year, was integrated successfully and 

performed ahead of our expectations. 


• London Bridge station, UK 

• British Waterways engineering term contract, UK 

• Sussex train lengthening package 3, UK 

• Managed motorway delivery hub, UK 

• Traffic management technology framework, UK 

• Crossrail Thames Water delivery partner, UK 

• ICE high speed rail, section 21, Germany 


UK Germany Total UK Germany Total 

Revenue (£m) 75.0 26.2 101.2 87.2 23.6 110.8 


profit (£m) 

4.0 1.5 5.5 5.5 1.1 6.6 

Margin 5.3% 5.7% 5.4% 6.3% 4.7% 6.0% 

Order book (£m) 106.2 28.8 135.0 98.9 35.2 134.1 

People 1,084 404 1,488 1,139 366 1,505 


On the right track: Crossrail 

Capital value: £240M 

Client: Crossrail 

Scope: Station design (including new 

concourse connecting all London 

Underground and Overground lines, fit 

out of two new 240m platforms and two 

30m deep shafts) and management of 

interfaces, adapting RIBA C+ scheme 

design to RIBA F ready for tender. 

In September 2009, a multi-disciplinary team led 

by Hyder Consulting were appointed by Crossrail to 

design two major infrastructure schemes that will 

serve one of the busiest areas in East London. The 

Crossrail project is the largest civil engineering 

project in Europe and the largest single addition to 

the London transport network for over 50 years. 

Benefits 

These significant contracts for the design of a new rail station 

at Whitechapel will provide connections for Crossrail, London 

Underground and the London Overground services. Not only 

will this project contribute to improving Britain’s railway 

infrastructure, but it also reaffirms the success of our strategy 

of partnering with key clients in our core market sectors. Our 

hands-on approach and close working relationships with our 

client and project teams naturally develops strong and positive 

business relationships. 

Once complete, Crossrail will promote vital links to meet the needs 

of people and businesses throughout the South East and London’s 

financial and business centre in particular. As the largest civil 

engineering project in Europe, Hyder’s association with this world 

class project and upgrade to London’s Transport System provides 

invaluable career-defining experience for our people. 

Achievement and outcomes 

Whitechapel station is one of six major underground stations in 

the central underground section of the Crossrail scheme. It is a 

busy interchange between the recently upgraded and extended 

London Overground, the Hammersmith & City, District and 

London Underground lines. The station is situated in a vibrant 

and growing local community, close to the newly extended 

Royal London Hospital. Connection to the Crossrail scheme has 

led to major improvements to Whitechapel station area as the 

project is seen as being a catalyst for urban regeneration along 

Whitechapel Road. 

The Crossrail team identified an opportunity to redesign the 

station to achieve a simplified layout, redesigning it entirely to 

make the passenger routes more direct thus improving customer 

experience. This meant a smaller station footprint with more of 

the passenger flow being above ground, resulting in a smoother 

flowing station. Substantial cost savings – potentially of up to 

13% of the initial construction cost estimate were achieved. 

The development of this option and the production of the final 

design were completed within the original programme. This 

change not only produced a better station layout but it saved 

the client in excess of £60m. 

The integrated client, delivery partner and design team’s 

excellence, expertise and innovation were demonstrated by 

their teamwork and strong grasp of the key issues at an early 

stage in the design process. Post contract award, Hyder worked 

with Crossrail’s delivery partners to further explore ideas and 

agree design improvements. 

When Crossrail opens, Whitechapel station will become 

an important transport hub connecting the new line to the 

District, Hammersmith & City lines as well as the new London 

Overground line. 

Even before on site work commenced on the 

project, the following awards had been won: 

• Crossrail award for Value for Money 

• Crossrail award for Value for Safety 

• Fire Safety Engineering Award - 2011 Fire Excellence 

Critical success factors 

Meeting the obligations of the Crossrail Act and requirements of 

planning authorities is essential to the success of the scheme, 

particularly during and after construction. The potential impacts on 

local residents living in apartments overlooking the station and the 

nearby Swanlea School have heavily influenced the design. With 

utility diversions and enabling works to be carried out in a highly 

constrained inner-city location, this is a complex and demanding 

project. 


People and Culture 

- nurturing talent for 

outperformance 



Our people philosophy 

• We strive to attract and retain highly 

talented people who have the 

necessary aptitude and development 

potential. 

• We aim to create a professional 

environment for staff which meets the 

highest international standards and in 

which they will thrive and grow. 

• We value an individual’s ability to work 

in multiple international environments, to 

work collaboratively and to adapt rapidly 

to new environments and demands. 

• We aim to provide professional training 

in client care, project execution, 

relevant new technologies and 

commercial management. 

• We attach the highest importance to 

personal integrity, mutual respect and 

the proper recognition of individual and 

team performance. 

• We will continue to develop a strong 

cadre of senior consultants who have 

specialist know-how in our targeted 

sectors and who are able to develop 

close and productive client relationships. 

Encouraging employee 

mobility 

By actively encouraging the movement of our 

people between regions, we can mobilise specialist 

talent to resource projects whilst also offering our 

people international experience, development of 

their skills base and work on prestigious, crossdiscipline 

projects. 

Employee training and 

development 

We directly invest approximately 1% of annual revenues in 

training, and significant amounts of time are also dedicated 

to on the job technical training and coaching from peers. 

Over the last year we have introduced the Hyder Learning 

Academy as a comprehensive response to providing support 

for the training and career progression of our people. The 

Learning Academy is designed for staff in all career streams 

and grades, and offers a structured learning curriculum 

which allows people to take an independent approach to 

their own learning based around their current role and 

desired career pathway. The curriculum is divided into four 

main areas of learning: 

• building or refreshing professional and technical skills 

• building commercial business skills and acumen 

• developing client relationship skills 

• developing personal impact. 


Hyder group induction 

A comprehensive corporate induction programme 

to assist new staff in understanding the Hyder 

culture and strategy. The induction also covers 

the business plan, our systems, formal and 

informal networks, policies and the support tools 

available to help people succeed in their job. 

Project management 

We run comprehensive project management 

training for our project managers in order to share 

best practice and lessons learned on our major 

projects. Training includes planning, risk, value, 

collaboration, client feedback and negotiation 

skills. 200 of our people completed project 

management training throughout the year. 

Apprenticeship programme 

We are developing future leaders of tomorrow 

apprenticeship programmes providing talented 

people (who are otherwise not able to attend 

university) with an opportunity to build a 

professional engineering career. Hyder UK received 

the first Greater London Authority Responsible 

Procurement Award for ‘Skills and Employment’ and 

an award from a London college for ‘Outstanding 

support to Apprentices’. There are currently 64 

apprentices and students employed across the 

group. 

Accelerated skills 

development programmes 

These programmes are designed to accelerate the 

development of skills and competencies of our 

highly talented professionals, preparing them for 

future senior professional and leadership roles. 

50 of our top people have already taken part in 

comprehensive action learning programmes with 

more scheduled for 2012-13. 

Graduate and professional 

development programmes 

Hyder’s Graduate Development Programme guides 

graduates through their first three years at Hyder 

and provides interactive and structured training 

plans to develop relevant business acumen when 

they achieve chartered status. There are currently 

182 staff undertaking our graduate programmes. 

For other more experienced staff, we ensure they 

are not only extended in their particular field, 

but receive professional skills and leadership 

training through a combination of challenging 

assignments, coaching and career mentoring. 

Professional networks and 

development 

Our people are encouraged to join professional 

associations and groups to facilitate chartered 

engineer status, and provide development and 

networking opportunities. 

Our Professional Excellence Groups have been 

set up to provide support and collaboration 

between technical experts. These and the other 

informal networks throughout the company, 

mean our people can become involved in local 

or international client opportunities and ideas 

exchanges that foster innovation and excellence. 



Remuneration, recruitment and 

managing for performance 

We aim to fairly incentivise, reward and recognise our 

people based on their performance and contribution to 

Hyder. We undertake research in our local marketplaces to 

inform our remuneration strategy, taking into consideration 

industry benchmarks, as well as regional economic and 

business forecasts. In addition to salary, we also offer 

comprehensive benefits, performance-related bonuses for 

senior roles, share incentive plans and employee recognition 

programmes. 

Our Professional Development Review process is designed 

to ensure all our people have clear objectives which align 

with Hyder’s corporate objectives. In addition, everyone 

has tailored personal and professional development plans to 

enable them to grow and develop in their careers. Published 

position descriptions and job competencies help staff 

identify the qualities and capabilities that are required 

to take the next step in their careers. As a result of this 

approach to managing for performance, our people have 

indicated in this year’s engagement survey that they know 

what is expected of them in their role (93% favourable 

response) and they also believe that their work helps Hyder 

achieve its objectives (97% favourable). 

Positive engagement and action 

in Corporate Social Responsibility 

Hyder’s people are strongly committed to Corporate Social 

Responsibility (CSR). They have been resourceful in many 

of its manifestations such as sustainable design, reducing 

waste, conserving resources and by volunteering their 

expertise to charitable activities that directly and positively 

influence the local communities in which they operate. This 

commitment and resourcefulness has been recognised by the 

FTSE4Good Index. Following a review of our CSR Report, our 

Annual Report and our website, Hyder has now been included 

in the index of companies deemed to have met globally 

recognised corporate responsibility standards. This will make 

it easier for ethical funds and investors to find suitable stock 

that align with their investment criteria in the area of CSR. 

More information is outlined in our CSR report. 

Communications 

We aim to provide opportunities for staff to get involved in 

and have a voice on matters of concern to them. In response 

to feedback, we have improved and increased the channels 

via which we communicate and consult with our people. We 

encourage one-on-one communication between employees 

and line managers and offer individuals the chance to make 

their views known through feedback at regular presentations 

by senior managers. Other communication channels include 

office and team meetings, intranet, weekly and monthly 

staff bulletins or newsletters, topical podcasts, the chief 

executive ‘Ask Ivor’ page, and our CSR ideas forum. 

Upholding diversity and equal 

opportunities 

Hyder is an equal opportunities employer and has a diverse, 

multinational and multi-disciplined workforce. Individuals 

are assessed on the basis of the job requirements, their 

relevant aptitudes, skills and abilities, and their ability 

to uphold Hyder‘s values. We aspire to best practice in 

equal opportunities and anti-discrimination wherever we 

operate. Local legislation prescribes minimum standards 

which we follow and, where appropriate, seek to surpass. 

Hyder’s diversity and inclusion policy underlines the 

group’s commitment to promoting diversity and inclusion 

in all areas of recruitment, training and promotion, and 

to ensuring equality of opportunity and elimination of 

discrimination. 

We expect high standards of conduct from our people and 

have introduced group-wide education on the policies 

we have set for conduct and business ethics. We monitor 

understanding of these policies and compliance with the 

group’s equal opportunity policy, which offers equality of 

opportunity and support for disabled members of staff. 

We are committed to giving full and fair consideration to 

applications for employment made by disabled persons, and 

to encourage the training, career development, promotion 

and involvement in the workplace of disabled persons. 

Where applicable, we offer retraining to disabled staff to 

ensure that they can continue to perform work appropriate 

to their aptitudes and abilities. 


Taking the highway: 

The Hunter Expressway 

Client: Roads and 

Maritime Services (RMS) 

Contract value: 

AUD30M (Hyder) 

Services: Complex bridge 

and highways designs, civil 

structures and geotechnical 

engineering. 

The Hunter Expressway is currently the largest 

road project underway in New South Wales, 

Australia. The AUD1.7 billion project will form part 

of a new bypass route that will benefit regional 

and long haul traffic. 

The Expressway involves the construction of a 40 kilometre dual 

carriageway to be built under two contracts; the eastern and 

western packages. Hyder forms part of the Hunter Expressway 

Alliance - along with the state government’s Roads and Maritime 

Services (RMS), Thiess and Parsons Brinckerhoff – which will 

deliver the eastern section. This section is 13 kilometres long and 

includes building three viaducts through the rugged terrain of the 

Sugarloaf Range. 


Hyder’s expertise, combined with the proactive approach adopted 

by all alliance partners, enabled the team to successfully address 

technical, constructability and environmental requirements in the 

design. 

As an example, approximately two kilometres of viaduct through 

the Sugarloaf Range were originally designed to be built using 

the incremental launch method. However, by reverting to a 

balanced cantilever approach, bridge span lengths could be 

increased and environmental benefit brought to the Aboriginal 

cultural heritage and flora in the area. 

Managing the remedial treatment to old mine workings in the 

area was a major technical risk for the client and the future 

operation of the expressway. The client’s decision to engage the 

Alliance team to develop a solution was validated when the team 

delivered one under time and budget. 

Benefits 

When complete, the project will provide a new route between the 

west of Newcastle and urban growth centres in the Lower Hunter, 

cutting travel times between Newcastle and Branxton by up to 

28 minutes, and improving efficiency of the highway network 

between Sydney, Newcastle and Brisbane. 

Results and achievements 

Working alongside the alliance partners, including two key clients 

(RMS and Thiess), Hyder has showcased technical excellence, 

reinforced value through design solutions and strengthened 

relationships. 

The project is an impressive embodiment of Hyder’s core values 

- trust, teamwork and excellence. Complex geological issues, 

sensitive cultural areas and the imposition of strict vegetation 

clearing limits were overcome with innovative thinking and 

best practice engineering, facilitated through a collaborative 

alliancing approach. 

Hyder continues to provide site-based design support during the 

construction phase, and the project is on track to meet its target 

completion date in 2013. 


24 Hyder Consulting PLC Annual Report 2012 

Financial 

Review

Financial Review 

The group’s geographic diversity has enabled us to report 

another good set of financial results, in what have been 

mixed market conditions. Our Australian business has 

continued to perform well and benefited from the strength 

of the Australian dollar. In the Middle East our results have 

improved as new projects have been secured, following 

our investments in Qatar and Saudi Arabia. The UK, and 

particularly the highways sector has been challenging, 

however our results have held up well and we are now well 

positioned for the year ahead. 

Cash balances have improved in spite of the current liquidity 

pressures, and more onerous payment terms that exist 

with public sector clients in the Middle East, where we 

are growing. At the year end our net cash balances were 

£15.6m, up from £13.1m the year before. 

Revenue and profit 

Revenue for the year was £277.3m (2011: £290.3m), 4.5% 

lower. Net revenue, after deduction of sub-consultant 

costs, was 3.8% lower at £241.8m (2011: £251.4m). On a 

constant currency basis revenue and net revenue decreased 

by 6.1% and 5.5% respectively. The reduction in revenue is 

principally due to the challenging market conditions in the 

UK, and particularly the highways market. 

In presenting the group’s adjusted profit below, 

amortisation of acquired assets, acquisition costs and 

exceptional items have been excluded as the directors 

believe that this assists with understanding the underlying 

performance of the group: 

2012 

£’000 

2011 

£’000 

Change 

% 

Operating profit 17,070 18,156 (6.0%) 

Add back: 

Amortisation on 

acquired intangibles 2,462 2,147 14.7% 

and acquisition costs 

Exceptional items 1,499 - - 


profit 

21,031 20,303 3.6% 

Net finance costs (353) (443) (20.3%) 

Net pension interest 

income 929 466 99.4% 

Adjusted profit before 

taxation 21,607 20,326 6.3% 

Adjusted operating profit increased 3.6% to £21.0m (2011: 

£20.3m). The adjusted operating margin on net revenue 

increased to 8.7% from 8.1%. 

Redundancy costs of £1.5m (2011: £2.9m) have been 

absorbed within adjusted operating profit following actions 

to more closely align our resource levels with the mix of 

projected workload. The redundancy costs were primarily 

incurred in the UK (£0.6m), Australia (£0.5m), and the 

Middle East (£0.3m). Foreign exchange gains of £0.9m have 

been recognised within operating profit from translation of 

overseas profits, largely in Australia. 

Adjusted profit before taxation increased 6.3% to £21.6m 

(2011: £20.3m). 

Exceptional items 

Exceptional items incurred in the current year relate to UK 

vacant properties (£1.3m) and costs related to the closure 

of the UK defined benefit pension scheme to future accrual 

(£0.2m). The vacant property costs in the UK comprise 

rental costs for the remaining life of the lease where due 

to structural changes the offices are no longer required for 

future use. The exceptional cost taken in the current year 

will lead to overhead savings in future years. In order to 

reduce the rate of growth of the UK defined benefit scheme’s 

liabilities, and the volatility of the deficit, the scheme 

was closed to future benefit accrual on 30 April 2011. This 

resulted in closure costs of £0.2m being incurred. There 

were no exceptional items in the prior year. 

Taxation 

The taxation charge for the year was £3.7m (2011: £3.3m), 

equating to a tax rate of 21.1% (2011: 18.1%). The tax rate 

on adjusted profit before tax was 20.5% (2011: 17.9%). 

The increase in the tax rate is a result of a change in the 

mix of the group’s profits, with more of the group’s profit 

being earned in higher rate jurisdictions. The current rate 

is lower than the UK rate of 26% reflecting research and 

development tax credits in both Australia and the UK, and 

lower tax rates in the Middle East. 

Earnings per share 

Basic earnings per share amounted to 36.48p (2011: 39.29p); 

diluted earnings per share was 35.96p (2011: 38.63p). The 

weighted average number of ordinary shares during the year 

was 38.2m (2011: 37.9m), reflecting the shares issued to 

satisfy options exercised during the year offset by shares 

purchased by the company’s employee benefit trust. After 

adjusting for the amortisation of acquired intangibles, 

acquisition costs and exceptional items, fully diluted 

earnings per share increased by 2.3% to 44.34p (2011: 

43.34p). 



Dividends 

In recognition of the group’s financial performance, the 

board has proposed a 16.1% increase in the full year 

dividend to 9.0p (2011: 7.75p). A final dividend of 7.0p per 

share (2011: 6.0p) is proposed for the year to 31 March 2012 

which, if approved by the shareholders, will be paid on 10 

August 2012 to shareholders on the register at 13 July 2012. 

The full year dividend is covered 4.9 times by adjusted fully 

diluted earnings per share (2011: 5.6 times). 

Acquisitions 

In the current financial year the group made three 

acquisitions for cash consideration of £3.1m; ESR, a specialist 

energy, water and space consultant operating in the UK 

and Abu Dhabi; SAK infrastructure consultants in Saudi 

Arabia (£1.1m); and GW Engineers, a resources consultancy 

in Australia (£2.0m). Further contingent consideration of 

£2.6m may be payable in relation to the acquisition of GW 

Engineers dependent on business performance. 

The charge for amortisation of acquired intangibles was 

£1.8m (2011: £2.1m). In the current year £0.7m (2011: £Nil) 

of costs were incurred in relation to legal and due diligence 

fees on completed acquisitions. 

Goodwill on acquired businesses is carried forward at cost, 

and reviewed annually for impairment. There has been no 

impairment to the carrying value of goodwill this financial 

year and details of the assumptions used in the calculations 

are shown in note 8. 

Capital structure 

During the year the company issued 94,250 10p ordinary 

shares in relation to exercised share options. As at 31 March 

2012 there were 38,634,530 (2011: 38,540,280) fully paid 

10p ordinary shares in issue. 

During the year to 31 March 2012 shareholders’ equity 

increased by 6.8% to £86.9m (2011: £81.4m) primarily 

reflecting retained earnings for the year. 

Shareholder return 

At 31 March 2012 the net asset value per share was 225p 

(2011: 211p). The closing share price on 31 March 2012 

was 414p per share (2011: 362p); market capitalisation was 

£159.9m (2011: £139.5m). 

Financing 

At the year end the group had net cash balances of £15.6m 

(2011: £13.1m). Cash balances increased to £23.2m (2011: 

£22.2m) and total borrowings reduced to £7.6m (2011: £9.1m) 

providing substantial headroom against available facilities. 

The group’s principal committed banking facilities totalling 

£47.6m are with HSBC and Barclays in the UK which include 

revolving credit facilities of £22.5m and £18.0m expiring in 

December 2015 and February 2013 respectively, and other 

long term facilities of £7.1m. In addition the group has 

access to a number of overseas and on demand facilities 

of a further £5.3m, and leasing facilities of £0.5m. Total 

facilities amount to £53.4m, all of which are unsecured. 

Under the terms of its principal banking facilities the group 

is required to operate within certain financial covenants. 

In line with market practice these are related to net debt, 

EBITDA, debt service costs and interest cover. The group 

had significant headroom within all of these covenants 

throughout the year. 

The net finance costs of the group, before pension interest 

income, amounted to £0.4m (2011: £0.4m). Pension interest 

income amounted to £0.9m (2011: £0.5m) and is discussed 

in further detail below. 

Cash flow 

Net cash was £15.6m at 31 March 2012 (2011: £13.1m) the 

movement is shown below: 


£m 

2011 

£m 

Net cash 1 April 13.1 3.6 

EBITDA 25.8 25.5 

Working capital 

(5.9) (2.6) 

movements 

Other movements (0.4) (0.7) 

Cash from operations 19.5 22.2 

before pension deficit 

contributions 

Pension deficit 

(3.9) (3.0) 

contributions 

Cash from operations 15.6 19.2 

Interest (0.5) (0.3) 

Tax (4.5) (4.5) 

Acquisitions (2.5) (0.4) 

Capital expenditure (net) (2.2) (2.2) 

Dividend (3.0) (2.4) 

FX / Other (0.4) 0.1 

Net cash 31 March 15.6 13.1 


The Bearing Active 

Preload system for 

use on Alphasat, 

and Europe’s 

EDRS satellite 

communications 

constellation, ESR 

Technology, UK 

Cash generated from operations before pension deficit 

contributions of £3.9m (2011: £3.0m) was £19.5m (2011: 

£22.2m). The proportion of EBITDA converted into operating 

cash flow in the year was 76% (2011: 87%). 

The working capital outflow amounted to £5.9m during the 

year (2011: £2.6m), principally due to settlement of prior 

year payables, accruals and liabilities acquired. Underlying 

trade debtor and work in progress balances reduced by 

£4.0m, before inclusion of acquired balances of £1.8m, 

largely in the UK and Europe offset by an increase in the 

Middle East due to slow contract settlements. We have 

received £7.9m from a client in Qatar subsequent to the year 

end, and made good progress in resolving delayed contract 

settlements in the region. 

Tax payments in the year, principally in Australia, amounted 

to £4.5m (2011: £4.5m). Cash consideration paid for 

acquisitions was £3.1m (2011: £1.1m) with cash balances 

acquired of £0.6m (2011: £0.7m). 

Post employment benefits 

The group operates both defined benefit and defined 

contribution schemes as detailed in note 26. 

The principal defined benefit scheme is the AGPS, for which 

the sponsoring employer is Hyder Consulting (UK) Limited. 

There are no group guarantees in place in relation to the 

AGPS. Following a consultation period with members the 

scheme’s trustees consented to close the scheme to future 

accrual with effect from 30 April 2011. 

The gross deficit in the scheme at 31 March 2012 reduced 

to £16.3m (2011: £17.3m); the deficit net of deferred 

tax reduced to £13.1m (2011: £13.5m). The reduction in 

the deficit reflects better than expected asset returns 

and deficit contributions of £3.9m in the year, offset by 

actuarial losses due to reduced discount rates. A triennial 

valuation of the scheme as at 1 April 2011 has recently been 

concluded. Fixed contributions for the current year will 

amount to £1.8m; in the next two years fixed contributions 

increase by £0.1m per annum; increased by RPI plus 1% 

thereafter. Contingent contributions may become payable 

annually up to a cap of £0.7m, dependent on the cash 

performance of the UK business. 

The main assumptions in valuing the deficit are disclosed in 

note 26. 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 Decrease / 

by 0.5% increase by 9% 

Rate of inflation Increase / decrease Decrease / 

by 0.5% increase by 6% 

Longevity Increase by 1 year Increase by 2-3% 

The group also operates certain overseas post employment 

benefit schemes, which principally relate to benefits payable 

to staff when they leave in the Middle East which have been 

actuarially valued for the first time this year. Net liabilities 

in relation to overseas and annuitants schemes increased 

to £7.9m (2011: £6.7m) as a result of ongoing service costs, 

a reduction in discount rates and the acquisition of SAK 

during the year. 

The net finance income for pension schemes amounted to 

£0.9m in the year (2011: £0.5m). In 2013 this is anticipated 

to reduce to £0.7m. The application of the changes to IAS 

19, ‘Employee Benefits’, from 2014 will affect the pension 

financing charge; if the change were applied in 2013 this 

would result in a pro-forma pension financing charge of 

approximately £1.0m. 

Principal risks and uncertainties 

The group is broadly based, both internationally and across 

market sectors, which provides considerable resilience to 

and mitigates against economic and political risks. The 

group’s risks are regularly monitored by the board. Risk 

management and internal control systems provide a means 

of identifying, evaluating and managing the significant 

risks facing the group. These systems can only mitigate risk 

rather than eliminate it completely. 

The group’s principal risks have been identified as follows: 



RISK 

Changes in market conditions 

The group’s business environment is competitive 

and we recognise that the actions of 

competitors or potential competitors may affect 

our business. 

Challenging market conditions can arise due to 

changes in social, economic or political factors, 

as well as increased competition. 

Contracts may be secured at lower margins, 

or the order book could decrease as fewer 

opportunities are secured. Cash generation 

could be affected and lower staff utilisation 

could result in reduced profitability. 

Management of projects 

Managing clients’ and our own projects is core 

to our business. 

Inadequate project management could lead 

to financial loss, increased risk of contractual 

disputes and claims and reputational damage. 

Contractual disputes and claims 

Disputes and claims can arise if we do not meet 

our contractual commitments, and where project 

solutions are inadequate or do not perform as 

intended. 

Disputes and claims could result in material 

settlements against the group, damage to our 

client relationships and limit our ability to 

secure future contracts. 

Recruitment, utilisation and retention of key 

staff 

Failure to attract and retain high quality staff 

will constrain the ability of the group to win 

contracts and grow the business. It could 

increase the risk of contractual disputes and 

claims. 

MITIGATION 

• Our strategy of service differentiation, key client 

management and international growth has enabled the 

group to avoid being dependent on individual markets, 

sectors or clients. 

• The international spread and sector diversity of the group 

provides protection against market changes in specific 

geographies or sectors. 

• The development of our design excellence centres in India, 

the Philippines and Bulgaria provides additional flexibility 

to respond to local market movements. 

• The group also recognises that its competitiveness is 

enhanced by the recruitment and retention of key staff 

members (see below). 

• We operate established bid processes to manage 

profitability and mitigate risks. 

• Technical and project reviews are undertaken regularly; the 

group’s internal systems and controls facilitate this process. 

• Regular project management training is provided and the 

group ensures that appropriately technically skilled staff 

are used on projects. 

• Established project and technical review procedures are in 

place to minimise any potential exposure. 

• Should disputes arise they are dealt with at a local level 

wherever possible, to protect and enhance our relationship 

with clients and suppliers. Where this is not possible 

disputes are escalated to regional or group management for 

resolution as swiftly as possible. 

• Arbitration or mediation services are used where possible. 

• A global insurance programme, at commercially acceptable 

rates, is maintained with appropriate limits of indemnity. 

• The group aims to offer competitive compensation 

packages to give it the opportunity to recruit and retain 

people of sufficient calibre. 

• We ensure that our staff obtain appropriate and relevant 

experience to develop further, which assists with their 

retention. 

• The human resources function plays a central role in 

succession planning, staff development and recruitment 

and staff retention strategies. 

• We regularly monitor our forward order book against our 

resource levels and plan accordingly in order to maximise 

staff utilisation rates. 

• We regularly review utilisation rates throughout our 

business and monitor them against pre-set targets taking 

prompt action where appropriate. 


RISK 

Management of working capital, particularly in the 

Middle East 

The majority of costs, including payroll, are paid before 

fees are settled by clients. It may take us longer to get 

paid than we anticipated through poor payment terms, 

late invoicing or poor collection of debts. 

Insufficient working capital could constrain growth 

and lead to increased use of banking facilities with 

the resultant costs. In the extreme we may breach our 

banking covenants. 

Defined benefit pension schemes 

The group’s main defined benefit pension scheme, the 

AGPS, has a deficit. 

The deficit is exposed to risk of changes in interest 

rates and asset values, as well as inflation and the life 

expectancy of the members. The cash cost of funding 

the existing deficit could increase in the future. 

Crisis event/business continuity 

A crisis event or business continuity issue could lead to 

a loss of staff and/or interruption to service delivery. 

We rely on our IT and office infrastructure in order to 

operate. 

The loss of IT systems, or being unable to access offices, 

could affect our performance. 

Health and safety 

The construction industry entails significant health and 

safety risks. 

There is a consequent risk to staff and clients, and also a 

risk of reputational damage to the group. 

MITIGATION 

• We develop and maintain close working relationships 

with clients and seek advance payments where 

possible. 

• Global cash requirement forecasts are regularly 

prepared and debt and work in progress levels with 

clients are monitored. 

• Cash management performance indicators are 

reviewed regularly at project, sector and regional 

level and have helped to develop a strong cash 

culture within the group. 

• The group maintains strong relationships with its 

principal bankers. The group currently has £41m of 

committed facility headroom. 

• The AGPS closed to new members in 2001 and future 

benefit accrual ceased in April 2011. 

• The group maintains a good relationship with the 

trustees and a revised funding plan has been agreed 

following the triennial valuation on 1 April 2011. 

• Disaster recovery plans are in place and are reviewed 

regularly. 

• 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. 

• Where systems are identified as critical to the 

business their performance, resilience and security is 

reviewed regularly in order to provide assurance as 

to availability. 

• Health and safety is an essential element of all 

Hyder’s operations. 

• As a group we are committed to conducting our 

activities in such a way as to ensure the health and 

safety of our staff and anyone who may be affected 

by our operations. 

• We will comply with all relevant legislation and 

aim continually to improve our health and safety 

performance; all staff are expected to contribute to 

this goal. 

Kurt-Wabbel- 

Stadion, Germany 



RISK 

Foreign exchange movements 

The group reports its results in sterling, however only 

approximately 30% of the group’s revenue is generated 

in sterling. The remaining balance is generated in 

Australia, the Middle East, Germany, China and Hong 

Kong where revenue is normally denominated in the 

relevant local currency. 

Significant movements in foreign exchange rates will 

affect the sterling profits reported by the group and the 

value of assets and liabilities denominated in foreign 

currencies on the balance sheet. 

Global regulatory environment and business conduct 

The group operates in many jurisdictions and is subject 

to a wide range of rules and regulations, including the 

UK Bribery Act. Non-compliance could have significant 

consequences for our operations or reputation. 

MITIGATION 

• Established procedures exist to monitor foreign 

exchange risks in accordance with policies set by the 

board. A summary of the group’s key risk exposures 

and the use of derivative and financial instruments 

are given in note 15. 

• The revenue and costs of our international 

operations generally arise in the same currency and 

therefore the exposure to exchange fluctuations is 

not usually 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. 

• Regional management review their operations 

regularly including ethics, employment practices, and 

health and safety to ensure they have appropriate 

controls to monitor and prevent potential breaches 

of group policies and local legislation. 

• The group maintains a global ethical business 

code and has provided training on identifying and 

preventing bribery. 

Ivor Catto 

Chief Executive 


Russell Down 

Group Finance Director 


Hilton 

Hotel, 

Surfers 

Paradise, 

Australia 


Alba Water 

Transmission, 

Bahrain 


Directors and Advisors 

The Hyder Consulting PLC Board 

Directors 


Ivor Catto 

Russell Down 

Jeffrey Hume 

Paul Withers 

Chairman 

Company Secretary 

Neil Hunt 



Non-Executive Director 

Non-Executive Director 

Registered office 

29 Bressenden Place, London, SW1E 5DZ, UK 

Company registration number 

Hyder Consulting PLC is registered in England and 

Wales with company number 768087 

Auditors 

PricewaterhouseCoopers LLP 

1 Embankment Place, London, WC2N 6RH, UK 

Solicitors 

Wragge & Co LLP 

55 Colmore Row, Birmingham, B3 2AS, UK 

Registrars 

Capita Registrars Limited 

Northern House, Woodsome Park, Fenay Bridge, Huddersfield, 

HD8 0LA, UK 

Brokers 

Numis Securities Limited 

10 Paternoster Square, London, EC4M 7LT, UK 

Financial Advisors 

Investec Bank plc 

2 Gresham Street, London, EC2V 7QP, UK 

Principal Bankers 

HSBC Bank plc 

70 Pall Mall, London, SW1Y 5EZ, UK 

Head Office 

29 Bressenden Place, London SW1E 5DZ, UK 

Telephone: 020 3014 9000 

www.hyderconsulting.com 


Directors’ Biographies 

Sir Alan Thomas Chairman 

Sir Alan was previously President and CEO of Raytheon Europe International; 

Head of the British Government’s Defence Export Services Organisation (DESO); 

CEO of Data Logic; a Director of Powergen plc; Chairman of Three Valleys Water 

plc; Chairman of Global Design Technologies LLC; a Senior Industrial Advisor to 

the Water Regulator; a Member of the Engineering Council; and Chairman of the 

University of Westminster. He is a Chartered Engineer, Chartered Management 

Accountant and an Hon DSc. 

Ivor Catto Chief Executive 

Mr Catto was appointed as Chief Executive in December 2008. Prior 

to joining Hyder, Mr Catto was a member of the Executive Board of 

WS Atkins plc and previously held roles at Scottish Power plc and 

Babtie Group. He is a Chartered Engineer, a Fellow of the Institution 

of Mechanical Engineers, and a graduate of Harvard Business School’s 

Advanced Management Program. 

Russell Down Group Finance Director 

Mr Down was appointed as Group Finance Director in December 2008. He 

joined the group in 1997 as Finance Director for the Middle East region, 

based in Dubai, and subsequently held the roles of Group Financial Controller 

and Group Head of Finance and Development. He is a Fellow of the Institute 

of Chartered Accountants in England and Wales, having qualified with KPMG. 

Paul Withers Non-Executive Director 

Mr Withers was appointed as a Non-Executive Director in September 

2006. He is also a Non-Executive Director of Premier Farnell plc and 

Devro plc and was a Group Managing Director of BPB plc between 2001 

and 2006. He is a Chartered Engineer and a graduate of the Sloan 

Fellowship programme of the London Business School. 

Jeffrey Hume Non-Executive Director 

Mr Hume was appointed as a Non-Executive Director in May 2007. He is also 

a Non-Executive Director of Dover Harbour Board, Moat Homes Limited and 

a member of the London Stock Exchange’s Primary Markets Group. He is a 

Fellow of the Institute of Chartered Accountants in England and Wales and of 

the Association of Corporate Treasurers. He is a former Group Finance Director 

of TDG plc, AWG plc, Alfred McAlpine plc and Howden Group plc. 



Northparkes 

Mine, Australia

Directors’ 


Corporate 

Governance 


Chairman’s introduction 

I am pleased to introduce Hyder Consulting’s 2012 Corporate 

Governance Report. 

I would like to affirm at the outset that Hyder Consulting 

is committed to maintaining high standards of corporate 

governance and that its board fully supports the principles 

of the UK Corporate Governance Code (“Code”) as they apply 

to the company. The Code can be found on the FRC website 

(www.frc.org.uk). 

The report below and the Directors Remuneration Report 

(see pages 64 to 71) provide a detailed commentary on 

the activities of the board and its committees throughout 

the year and together explain how we have applied the 

principles of good governance as detailed in the Code. I 

can also confirm that the company has complied with the 

provisions of the Code relevant to smaller listed companies 

throughout the year. 

We are conscious of our responsibility to maintain a balance 

of skills, experience and knowledge on the board and its 

committees in order to manage the company and execute 

its strategy successfully. We believe that our small and 

very experienced board has discharged this responsibility 

effectively during the past year. Looking ahead, and in 

view of the proportion of our business in Asia-Pacific, we 

began a search for a new non-executive director who has 

substantial experience of the region and who may be based 

there. An appointment will also refresh the board, increase 

its diversity, and help enable orderly board and committee 

succession. 

The Code does not require the board members of smaller 

companies to submit to annual re-election; however the 

board is proposing for the first time to offer all its members 

for re-election at the forthcoming AGM. 


Chairman 

Directors and the board 

As at the date of this report the board comprises the 

chairman, two executive directors and two independent 

non-executive directors. A list of the individual directors, 

their biographies and other significant commitments are to 

be found on pages 32 and 33. 

As recommended by the Code the roles of the chairman 

and chief executive are held separately and there is a clear 

division of responsibilities between each position. 

The senior independent director (“SID”) is Jeffrey Hume who 

succeeded Paul Withers in this role on 6 May 2011. It is the 

board’s current intention that the role is held on a two year 

rotation. 

The board’s primary responsibility is to its shareholders for 

the group’s financial and operational performance whilst 

fulfilling its obligations to its clients, to its staff and to the 

communities it serves. Its task is to provide entrepreneurial 

leadership, to formulate an effective competitive strategy 

and to execute it successfully. 

Whilst the board has delegated the normal operational 

management to the chief executive, the board has a formal 

schedule of matters that are specifically reserved for its 

decision. The schedule is reviewed annually and updated as 

necessary and includes the following matters: setting the 

group strategy and direction, results and financial reporting, 

company dividends, corporate governance arrangements, 

group policies, approval of material contracts, approval of 

changes to the capital structure of the company, internal 

controls and risk management systems and approval of 

acquisitions and divestments. 

Under the guidance of the chairman, board meetings operate 

to a standing agenda ensuring that financial, operational, 

strategic and other matters requiring regular periodic 

review are given sufficient time for debate and scrutiny. The 

chairman is responsible for ensuring that adequate time is 

available for discussion of all agenda items, in particular 

strategic issues, and there are regularly scheduled reviews 

of the company’s strategy. The chairman holds meetings 

from time to time as he considers appropriate with the nonexecutive 

directors without the executive directors present. 

Several such meetings were held during the year. 

On appointment, directors receive an induction tailored to 

their needs taking into account their previous experience. 

This includes financial and business information about the 

group, information about the role of each director and the 

board as a whole and the matters reserved to it, the terms 

of reference of and the powers delegated to the board 

committees. The induction also includes access to senior 

management and office visits to help the new directors 

familiarise themselves and gain an understanding and 

appreciation of the group’s business. 

The annual schedule of board meetings provides for certain 

meetings to be held at different group offices, both within 

the UK and overseas. Two meetings are scheduled jointly 

with the executive board which greatly assists in the 

relationship and understanding between the board and the 

group’s senior executives as well as the board’s knowledge 

of the group’s international operations. The chairman makes 

regular visits overseas to meet clients and staff and the 

board as a whole makes bi-annual visits to group offices, to 

meet with local senior management and staff and to receive 

presentations on the local business. These visits greatly 

assist directors’ ability to keep in touch with the pressures, 

priorities and opportunities in the group. 

The company provides the necessary training and resources 

for developing and updating the directors’ knowledge and 

capabilities, including briefings from external advisors 

where necessary. 

The directors have access to the advice and services of the 

company secretary and are empowered to take independent 

professional advice in the furtherance of their duties at the 


company’s expense as appropriate. No such independent 

professional advice was sought during the year. The 

company secretary also provides advice and support to 

each of the board’s committees and to the chairman on all 

corporate governance matters. 

The number of formal scheduled board and committee 

meetings held and attended by directors during the year 

was as follows: 

Board Audit Nomination Remuneration 

Scheduled Meetings 10 3 1 4 

Sir Alan Thomas (N) 10 - 1 - 

Ivor Catto 10 - - - 

Russell Down 10 - - - 

Jeffrey Hume (A,N,R) 10 3 1 4 

Paul Withers (A,N,R) 10 3 1 4 

Notes: 

(A) audit committee, (N) nomination committee, (R) remuneration 

committee. 

In addition to the formal scheduled meetings, additional 

ad hoc board and committee meetings were held during the 

year to consider time critical matters. 

Evaluations 

A formal performance evaluation is carried out annually for 

the board, the audit committee, the nomination committee 

and the remuneration committee. Each director completes 

a board evaluation questionnaire in a form consistent with 

previous years to allow comparative analysis, the results 

of which are collated by the company secretary, reviewed 

by the chairman and a summary of the principal findings 

is presented to and discussed at the board. The board also 

evaluates each of the board committees. 

Overall, the evaluation process concluded that the board 

and its committees were working effectively. The main 

area for consideration identified from this year’s evaluation 

process related to deepening further the non-executives’ 

understanding of markets and sectors in which the 

group operates, especially in the Asia-Pacific region. The 

initiatives we have taken are explained elsewhere in this 

section. 

The chairman reviewed the performance and development 

needs of each of the executive and the non-executive 

directors taking into account the views of the other 

directors. The non-executive directors’ performance 

evaluations also addressed their capabilities, time 

commitment and effectiveness in their role and the pattern 

of their future service. The performance of the chairman was 

reviewed by the independent non-executive directors led 

by Jeffrey Hume as the SID, having taken into account the 

views of the executive directors. 

Independence 

In compliance with the requirements of the Code, the board 

considered the independence of each of Jeffrey Hume and 

Paul Withers who served during the year as non-executive 

directors. 

After careful consideration, the board determined that they 

were free from any business or other relationship that could 

materially interfere with their respective judgement and 

that they had each demonstrated the required degree of 

independence, both in character and judgement, taking into 

account all the relevant circumstances. 

Election and re-election 

The board has determined that all directors should retire 

annually at the AGM and where eligible, seek re-election. 

All directors will therefore be subject to annual re-election 

at the 2012 annual general meeting (“2012 AGM”). This will 

also satisfy the requirements of the company’s articles of 

association regarding retirement of directors by rotation. 

All executive directors’ service contracts and letters of 

appointment for the chairman and the non-executive 

directors are available for inspection by shareholders during 

normal business hours at the company’s registered office 

address and will also be available for inspection at the 2012 

AGM. 

Non-executive directors are appointed for an initial term 

of three years, which are capable of extension for up to a 

further two, three-year terms. Each of the current nonexecutive 

directors is in their second three year term. 

Following review and on the recommendation of the 

nomination committee, the board agreed to extend Paul 

Withers’ term to expire at the AGM in 2013. He will continue 

as chairman of the remuneration committee and a member 

of both the audit committee and nomination committee. 

Subject to any further extension, Jeffrey Hume’s current 

term expires in May 2013. 

Insurance 

The company maintains an appropriate level of directors 

and officers insurance in respect of legal actions against the 

directors. 

Board committees 

The board has formally delegated specific responsibilities to 

three committees of the board, namely: audit, nomination 

and remuneration. Each committee operates under written 

terms of reference which clearly outline its authority 

and duties. The terms of reference are reviewed annually 

and copies are available on the company’s website www. 

hyderconsulting.com. 


Directors’ Report Corporate Governance continued 

Audit committee 

During the year the audit committee comprised the two 

independent non-executive directors and had three formally 

scheduled meetings. The external auditors attended two of 

the three meetings. The chairman, chief executive, group 

finance director, group financial controller and the head of 

internal audit attend meetings by invitation. The committee 

takes the opportunity to seek the views of the external and 

internal auditors without any executives present at least 

twice a year. 

Appointments to the committee are made by the board, 

on the recommendation of the nomination committee. 

Appointments are for a period of three years, subject to 

extension by up to two additional three-year periods. 

The audit committee is chaired by Jeffrey Hume and the 

board has satisfied itself that he has the necessary recent 

and relevant financial experience required by the Code. 

During the year the committee’s activities included: 

i. a review of the draft Annual Report and Financial 

Statements and 2011 half year report concentrating 

on the main areas of judgement; reviewing the 

report of the external auditors on their audit of the 

Annual Report and their review of the half 

year report; 

ii. considering the external auditors’ plan for the year 

and their scope of work and proposed 

fees; evaluating their effectiveness, objectivity and 

independence; reviewing their terms of engagement; 

making a recommendation to the board for their 

reappointment; and the approval of their fees; 

iii. reviewing the company’s policy for the external 

auditors providing non-audit services; 

iv. reviewing the company’s treasury, and anti-fraud 

policies, its ethical business code, and the procedures 

and policy for whistleblowing; 

v. reviewing the role and effectiveness of the internal 

audit function and reviewing its proposed annual audit 

plan; 

vi. receiving and considering reports from the internal 

audit function on compliance with group systems and 

controls and management responses to those reports; 

vii. receiving and considering reports on changes to the 

group’s risk register and management of key risks; 

viii. receiving and considering an annual report on the internal 

controls for managing risks operated by the group; 

ix. reviewing the company’s accounting policies; and 

x. reviewing the committee’s terms of reference. 

The internal audit function operates to an agreed annual 

programme of reviews of the internal control system, 


usiness processes and compliance with company systems 

and procedures across the group. The reports seek to identify 

any control weaknesses and make recommendations for 

improvement. Audit committee members receive copies of 

the reports or executive summaries and the head of internal 

audit attends audit committee meetings and is available to 

answer any questions on the content or recommendations 

within reports. 

In order to safeguard the objectivity and independence of 

the external auditors, the company has a policy regulating 

their provision of non-audit services. The policy is reviewed 

annually by the audit committee. The policy categorises 

services into three types by reference to the nature of the 

work: those that are authorised; those that are subject to 

specific pre-approval; and those that are prohibited. In the 

first category the approvals required escalate by reference 

to the proposed fee, from local management, to the group 

finance director and ultimately to the audit committee. In 

the second category the approvals are structured as between 

the group finance director and the audit committee. Audit 

and non-audit fees paid or payable to the auditors in the 

year under review are set out on page 85. Having considered 

the nature and extent of non-audit fees in the year, the 

committee is satisfied that these did not compromise the 

auditors’ objectivity or independence. 

The auditors were originally appointed in March 2002 and 

have been annually re-appointed by shareholders at each 

annual general meeting since then. To preserve auditor 

independence the lead audit partner is periodically changed 

and was last changed following the audit in 2011. 

Nomination committee 

The nomination committee comprised the chairman, who 

chairs the committee, and the two independent nonexecutive 

directors. In addition to the formal scheduled 

meeting, the committee held several informal meetings on 

board composition during the year. 

The committee’s activities include reviewing the structure, 

size and composition of the board and board succession. 

The committee supervises the recruitment process for all 

potential appointments to the board, agreeing the person 

specification, selecting any external recruitment consultants, 

considering all candidates whether internal or put forward by 

external consultants, and (following interviewing shortlisted 

candidates) making recommendations to the board for 

appointment. In selecting candidates the committee gives 

due regard to the benefits of diversity (see below). All 

recommendations made by the committee are made on 

merit against objective criteria. The committee manages 

the selection process for all board appointments in a 

formal, rigorous and transparent manner and in accordance 

with the procedure detailed above. The committee also 

makes recommendations to the board in respect of the 

reappointment of each director at the AGM. 

The annual review of the structure, size and composition 

of the board by the committee concluded that the board 

remained well balanced and was operating effectively. The 

committee was satisfied that the current board members had 

the necessary range of skills, experience and qualifications 

and acknowledged the value of adding further Asia-Pacific 

MTR, Wong Chuk 

Hang, Hong Kong 


Directors’ Report Corporate Governance continued 

experience. No individual or small group dominated the 

board’s decision-making process. 

The committee has made positive recommendations to the 

board in respect of each of the directors who are standing 

for reappointment at the 2012 AGM recognising the valuable 

skills, knowledge and experience each bring to the overall 

effectiveness of the board. 

Under the Companies Act 2006 each director has a duty to 

avoid a situation in which he has, or can have, a direct or 

indirect interest that conflicts, or possibly may conflict, 

with the interest of the company. This duty is not infringed 

if the situation cannot reasonably be regarded as likely to 

give rise to a conflict or if the conflict has been authorised 

by the board. The company’s articles of association allow 

un-conflicted directors to authorise conflict situations 

in appropriate circumstances. The company has a 

procedure for the disclosure of any such conflicts and, if 

appropriate, authorisation of the same. The procedure 

permits any authorisation to be granted subject to terms 

or conditions. The nomination committee also reviews any 

potential conflict of interest for any prospective director 

and all continuing authorisations annually and makes 

recommendations to the board. Authorisations may be varied 

or revoked at any time. 

The company maintains a register of any conflicts of interest 

of a director including the date of grant of the authorisation 

and any limitations or terms and conditions that apply. 

Diversity 

The group is an equal opportunities employer committed 

to promoting diversity and inclusion in the workplace at all 

levels and strives to build an open climate in which all staff 

are treated fairly, with dignity and respect. Group policy is 

to treat both members of staff and job applicants on the 

basis of individual merit, qualifications and competence. 

Access to all aspects of employment and promotion is on 

the basis of fulfilling the job requirement and demonstrating 

the required abilities and competencies related to the job. 

The board recognises the importance of diversity in the 

boardroom and the valuable contribution to the group’s 

overall performance that diversity across backgrounds, 

experience, knowledge, skills and gender can bring. 

In making new board appointments the board will seek 

to select individuals who are best able to meet the 

requirements of the required role and improve the overall 

diversity of the board. 

The nomination committee will have regard to diversity 

when reviewing the composition of the board, managing the 

recruitment process and making recommendations in respect 

of any new board appointments. 

The board will monitor its success in improving board 

diversity as part of the annual evaluation process. 

Remuneration committee 

During the year the remuneration committee comprised the 

two independent non-executive directors and was chaired 

by Paul Withers. 

A report on the activities of the remuneration committee 

and the executive directors’ remuneration is set out on 

pages 64 to 71. 

Internal controls 

The board has overall responsibility for the group’s system 

of internal control and for reviewing its effectiveness. The 

group’s internal control system provides an ongoing process 

for identifying, evaluating and managing the significant 

risks faced by the group in accordance with the Code. 

However, the system is designed to mitigate risk rather 

than eliminate it and can only provide reasonable and not 

absolute assurance against material misstatement or loss. 

The key features of the system of internal control, which 

continued to operate throughout the year, are as follows: 

• Comprehensive financial planning and reporting to 

group-wide accounting policies and procedures, 

including a detailed annual budget, which is approved 

by the board, monthly regional reporting against 

budget and reforecast, and against group-wide key 

performance indicators. 

• Monthly regional reviews of performance and risks by 

the chief executive and group finance director. 

• Established procedures and controls within the group 

IT systems designed to protect the security of group 

data and provide disaster recovery arrangements in all 

regions with regular reviews and updates. 

• Board reviews for all acquisitions, investments and 

significant capital expenditure. 

• Established procedures for managing treasury activities 

and risks. 

• Maintenance of the ISO 9001 registration across the 

group, together with ISO 14001, BS OHSAS 18001 

and AS/NZS-4801 registrations in different regions 

within the group, drive the relevant business processes 

including regular checks, reviews, approvals and audits. 

• Procedures for escalation of material risks from the 

region through the executive management to the 

board. 

• Monthly review and reporting on health and safety 

matters across the group. 


• Established group-wide systems and processes for 

providing services, which include the requirement for 

bid reviews, technical reviews and project reviews. 

• Maintenance and regular review by regional 

management teams of operational risk registers and 

periodic review by the board of the group strategic risk 

register and individual strategic risks to identify and 

quantify risks and determine and monitor mitigation 

strategies. 

• Internal audit which reviews and tests different aspects 

of the group’s internal control and risk management 

systems and processes following a programme agreed 

with the audit committee. 

During the course of the year the audit committee reviewed 

the effectiveness of the internal control systems. Areas 

identified for improvement have been actioned. 

Share capital 

Information about the share capital of the company is 

included on page 60 of the section headed “General 

Information and Disclosures”. 

Financial reporting process 

Relations with shareholders 

The board recognises the importance of maintaining good 

communications with current and potential shareholders. 

The chief executive and group finance director have a 

programme for dialogue and presentations to shareholders, 

institutions, brokers and the media which include those 

around the announcement of the full and half year results of 

the Hyder group. The chairman and SID meet institutional 

shareholders from time to time and are readily available to 

do so if requested. The board receives regular feedback from 

institutional investors, external analysts’ reports and market 

and shareholder analysis. This information and feedback 

from directors’ meetings with shareholders ensures all 

directors develop their understanding and appreciation of 

the views of current and potential shareholders. 

The company’s website www.hyderconsulting.com provides 

regularly updated information in relation to the group’s 

activities and financial performance, which is also available 

via the regulatory information services. 

Shareholders are given at least 20 working days’ notice of 

the AGM and are encouraged by the chairman on behalf 

of the board to attend each AGM. Save in exceptional 

circumstances all directors attend the AGM and this provides 

an opportunity for all shareholders, both private and 

institutional, to meet and ask questions of the directors. 

The group has well documented accounting policies and 

procedures for use by all group entities in the preparation 

and submission of monthly financial reports and the 

submission of financial statements for half year and year 

end consolidation. The policies are well established and 

operated by all group entities and require compliance 

with the company’s internal controls and risk management 

processes. The policies have been developed to comply 

with International Financial Reporting Standards and 

are regularly reviewed and updated as necessary. The 

procedures detail the additional disclosures and information 

required for inclusion in half year and year end group 

financial statements and report. 

All group entities use a common accounting system, 

facilitating consolidation of group results and minimising 

risks of transferring financial information across systems. 

The consolidated financial statements are prepared by the 

group finance team under the direction of the group finance 

director. During preparation all significant judgments 

made by group entities and other risks associated with the 

preparation of the consolidated accounts are reviewed and 

challenged where necessary by the group finance team and 

group finance director before consideration by the audit 

committee. 

All financial information published by the company is 

subject to approval by the audit committee. 


Clarissa at the 

Tondo School 

Directors’ 


Corporate Social 


Clarissa before she started 

at the Tondo School (PCF) 


Introduction from Ivor Catto 

Corporate Social Responsibility (CSR) is fundamental to 

how we operate as a business. We take responsibility 

for the effect our work has on the environment and our 

stakeholders: our people, clients, communities, suppliers, 

partners and investors. Our overarching goal with CSR is to 

assist the wider communities in which we work to meet their 

social, economical and environmental needs. 

Our strategy 

Our strategy is to build strong and enduring client 

relationships in those markets and sectors where we 

have demonstrable competitive advantage. We aim for 

continuous improvement to enhance our performance and 

incorporate CSR principles into our everyday operations 

across the group as well decision making processes and 

responsible business practices. 

Our mission 

In all we do we aim to be a trusted partner of valued clients 

– creating exceptional solutions. Developing innovative 

sustainable solutions is an integral part of this approach, 

alongside our donations and ‘in kind’ support to charities 

where we offer our technical skills and knowledge. 

Recognition 

In April 2012 Hyder met the inclusion criteria for 

the FTSE4Good Index series achieving an overall ESG 

(environment, social and governance practices) of four 

out of five. The ratings use the FTSE4Good Index’s 

inclusion criteria as a framework to assign ESG scores to 

approximately 24,000 companies globally, and provide 

objective ESG risk and performance data for investors. Our 

FTSE4Good accreditation recognises the integration of our 

CSR policies within our business practices. 

Hyder also holds a sustainability rating award as a 

constituent of the Kempen Sense Fund/SNS SRI Sustainable 

Universe. With a commendation for our environment, 

social and governance practices, we received particular 

recognition for our “human capital development”, an area 

in which Hyder is considered as quite progressive. Our 

commendation is based on the provision of opportunities 

for all employees to develop their professional skills and 

leadership competencies through a combination of job 

experiences, skills coaching and career mentoring next to 

their technical training. This also includes our community 

involvement and participation in community development 

programmes. 

Charities 

As part of our CSR objective of donating time and expertise 

to charitable work, we have supported and encouraged 

our people to provide practical assistance to a number of 

charities. These include the following: 

• WaterAid Australia 

• WaterAid UK 

• Sowers International (East Asia) 

• Ingenieur Ohne Grenzen (Germany) 

• International Federation of Red Cross and Red Crescent 

Societies (India and the Philippines) 

• The Philippine Community Fund – Tondo School (Manila, 

Philippines) 

The content of this report reflects some of our CSR 

highlights and achievements over the last year. 

We have utilised the company intranet to communicate 

charity-related activities and to measure and monitor our 

collective progress. This has resulted across the year in 

4,800 hours of time devoted to charitable work and in many 

cases significant time commitment from dedicated teams in 

each of our regions. As well as directly funding £55,000 to 

the nominated charities listed above, an additional £35,500 

has been raised by staff for other charities located around 

the globe. 

Sustainability 

We promote sustainability as a guiding principle through 

all our operations and have introduced a new Sustainability 

Framework. This framework includes standards for 

implementing a sustainable approach to business and 

project development, in order to achieve social, economic 

and environmental targets and benefits. 


Directors’ Report Corporate Social Responsibility continued 

We acknowledge that real commitment to corporate 

sustainability can enhance our competitive edge by 

providing innovation and award winning sustainable design 

for our clients. Maintaining professional excellence and 

promoting sustainable projects have been an important 

theme throughout the year. 

Achievements 

Last year our objectives related to achieving sustainable 

practices across all our operations. Through the efforts of 

our people working in partnership with local communities 

and charities, specific achievements are as follows: 

• As a group our staff donated £35,500 in addition to 

Hyder’s corporate donation of £55,000 for charities 

and communities in and around the regions in which 

we operate, and devoted more than 4,800 hours of 

employee time to providing expertise and skills to 

charities and important causes; 

• In collaboration with one of our six charities, we 

created a dedicated CSR blog space and forum where 

Hyder people can collaborate across the group, provide 

valuable input to CSR initiatives, and brainstorm 

on innovative solutions to some of the many CSR 

challenges facing our business, clients, and the 

communities in which we operate; 

• We worked across the group to share knowledge and 

expertise in sustainability and apply this in our projects 

and work practices to the advantage of clients and 

communities in which we operate; 

• To date in excess of 90% of Hyder staff have 

participated in training associated with our ethical 

business code which includes anti-corruption. Our 

ethical business code is available to suppliers of 

services to Hyder on our website; 

• Our UK ‘Green Team’ has expanded to bring together 

Facilities, Procurement and Knowledge Management to 

more effectively reduce our carbon footprint. As part 

of this, we run regular staff competitions, seeking ideas 

for local and UK-wide initiatives; 

• We met last year’s objective to reduce our carbon 

footprint by 5% including our use of indirect/direct 

energy. 

The content of this report reflects some of our CSR 

highlights and achievements over the last year. By following 

industry principles that define report content, we are 

ensuring the quality of information is communicated openly 

and clearly, thereby demonstrating our accountability to 

internal and external stakeholders. 

Ivor Catto 



Australia 

supports 

WaterAid 


Our Corporate Social Responsibility Policy 

Hyder’s vision is to be the next evolution in engineering consultancy. We are 

committed to running our business in an ethical and responsible manner. We apply 

the principles of sustainability to all our business operations. 

Our clients 

From our advisory and design work through to the 

management of major projects, we strive to create innovative 

solutions for our clients that achieve environmental, social 

and economic benefits for society. 

Our people 

We aim to be an employer of choice in our industry by 

embracing diversity and fostering an open and inclusive 

learning culture. The group health and safety policy reinforces 

our commitment in this area and demonstrates that people’s 

wellbeing is of paramount importance. 

Our suppliers and partners 

We collaborate with our key suppliers, treat them fairly and, 

where appropriate, support them in developing their own 

practices around social responsibility. 

Our investors 

Hyder offers investors an opportunity for responsible 

investment, founded on our ethical approach to doing 

business for over 150 years. 

Local communities 

We support our people’s enthusiasm for helping local 

communities and contributing their expertise towards 

charitable work, educational and community programmes 

such as ending child labour. 

Professional communities 

We are keen to promote our people’s involvement and 

participation in professional institutions and bodies. We play 

an active role in developing and implementing best practice 

and facilitating professional collaboration in all our technical 

fields. 

The environment 

We work to minimise the environmental impact of our 

own operations and those of the projects in which we are 

involved. We continuously aim for more efficient use of 

resources (such as energy), to help reduce greenhouse gas 

emissions and mitigate climate change. 

The board of Hyder Consulting PLC is responsible for 

communicating this policy, approving actions to be 

implemented, ensuring the necessary resources are made 

available, and for reviewing progress. Implementation is 

overseen by Hyder’s executive board. 

Governance 

We take an executive board overview of CSR and have 

appointed an executive board member, Misti Melville, as our 

CSR representative for the group. Throughout the year, Misti 

reports on Hyder’s performance at the executive board and 

is also involved in structuring the agenda at a regional and 

group level for a consistent approach to sustainability across 

the organisation. 

Hyder’s environmental experts and CSR representatives 

have been involved in shaping this report, with continued 

dialogue through the year on the development of our CSR 

agenda. 

Hyder undertakes Corporate 

Social Responsibility index 

benchmarking 

Following the benchmarking exercise last year, we 

set ourselves the objective of undertaking CSR index 

benchmarking again this year across the group to assess our 

CSR strategy, workplace and community management and 

environmental and social impact. 



Our strengths against the benchmark 

Hyder’s performance this year again highlighted the quality 

of our strategy against benchmark comparators in key areas, 

scoring above average in the following areas: 

• Corporate strategy 

• Integration 

• Community management 

• Environmental management 

• Marketplace management 

• Climate change 

• Waste management 

• Resource use 

• Corporate wellness and engagement 

• Employee development 

The results of the benchmark confirmed that Hyder’s CSR 

values are a core aspect of our corporate strategy. Key social 

and environmental principles are in place to recognise risks 

and opportunities in our operations and project work. More 

importantly, we effectively demonstrated the leadership 

responsibilities and commitment within the business to 

drive responsible business practices. 

We improved our stakeholder engagement through engaging 

our charity partners from a development perspective 

and supporting their operations with our expertise. Our 

commitment to partner with our staff, maintain a dialogue 

of regular updates, interactive tools and volunteer 

opportunities also supported this strategy. 

The various health and safety management programmes 

integrated within our corporate culture is highlighted as an 

organised and coordinated operation, supported by various 

staff wellbeing initiatives focussed on raising awareness 

about safety risks. 

Areas for improvement 

Hyder seeks to improve its benchmark score; therefore our 

CSR objectives for the next year will focus on: 

• Improving the process of setting up suppliers, giving 

performance feedback and where possible encouraging 

partnerships and increasing the practice of knowledge 

sharing. 

• Standardising our local supplier due diligence processes 

by including clear guidelines and the consideration of 

environmental and social factors on a project by project 

basis. 

Opportunities for Hyder 

Our commitment to operate in a socially and ethically 

responsible way naturally leads us to seek to improve our 

stakeholder engagement. As a result, we will encourage 

dialogue with both our internal and external stakeholders to 

discuss their needs and goals around environmental issues, 

while supporting them in their engagement and business 

plans. By actively promoting and sharing our experience 

in training and development, we aim to inspire our charity 

partners and other stakeholders to develop their own best 

practice and CSR agenda. 

Over the course of the next two years, we aim to reduce 

any adverse effect we have on the environment as a 

group and will support this by taking the lead from the 

UK and Australia regions by identifying an appropriate 

environmental management system in those regions 

(Germany, Asia and the Middle East) which are not yet 

ISO14001 accredited. 

10:10 

Hyder signs up for the 10:10 

campaign with teams in the UK 

pledging to reduce their individual 

and collective carbon footprints by: 

• making journeys using public transport that 

would otherwise have been by private car 

• wearing an extra layer of clothing so heating 

could be turned off at home 

• using energy-saving light bulbs 

• signing up to the car-share programme 

• turning off mobile phones, monitors and 

docking stations at the end of each day 

• opting to use internet communication tools 

for meetings to save on transportation costs 

• reducing food waste. 

This year the Hyder UK region’s mission is to 

spread the word and act as a catalyst for action 

that collectively makes a difference. As a 

result a large number of staff and the UK senior 

management team signed up to the pledge. We 

are proud of the role Hyder UK has played in such 

an important campaign and are keen to enhance 

our performance in next year’s campaign with 

other regions also joining in the challenge. 


Energy posters designed for Hyder offices by children of staff members 

A radical rethink to sustainable 

outcomes 

Hyder will begin to implement the ‘Hyder Heartbeat’, a 

common sustainability assessment method for rating projects 

throughout the planning process, across our regions from 

2012. The objective of the Hyder Heartbeat is to formalise 

the identification of sustainable practices early on in the 

project. This differs with the more traditional approach of 

‘scoring’ sustainable outcomes following a project. 

In utilising the Hyder Heartbeat, Hyder has developed an 

approach that quantifies and records what sustainable 

designs are implemented in projects. This allows the data 

gathered and the lessons learnt from each project to be 

accumulated, recorded and taken forward to the next project. 

The many benefits of our Hyder Heartbeat include: 

We are further developing this concept in 2012-13 so that 

our sponsored charities are encouraged to ask questions and 

collaborate with our people on solutions to the many issues 

they are facing. 

Bright ideas from the next 

generation 

Engaging and educating children on the environmental 

benefits of saving energy has been part of our agenda for the 

Tondo School. This year we also organised a competition with 

the children (aged six to 12) of our staff members and asked 

them to showcase their bright ideas around carbon saving. 

These ideas were translated into themed posters displayed 

around our offices to encourage staff to remember the 10:10 

pledge to cut carbon in the offices, on site and even at home. 

• achieving more sustainable outcomes for the client and 

community as well as continuous improvements to the 

project and future projects; 

• as information is shared, we are able to save time and 

costs for the client; 

• maximising supply chain development, local 

employment, education and training in the community; 

• developing a database of the best sustainable outcomes 

for a given climatic region. 

An innovative approach 

We know from the positive response to Hyder’s CSR agenda 

that our people feel strongly about CSR. In particular, they 

are keen to utilise their technical and leadership expertise 

to enrich communities around the world and create positive 

legacies for future generations. 

Hyder has been looking at where we can further innovate in 

CSR by creating an internal professional network. This is a 

forum where Hyder people collaborate across the group on 

CSR related issues. The forum is an opportunity for everyone 

to provide valuable input, and brainstorm on innovative 

solutions to some of the many CSR challenges facing our 

charities, clients, and the communities in which we operate. 

Wellbeing by Design 

The Wellbeing by Design programme 

continues to nurture a safety culture 

within the Australian region and has 

resulted in a reduction in incidents. 

Hyder has trained champions for ‘Safety Management 

Tasks’ (tasks we have identified that promote health, 

wellbeing and safety in our workplace) so they can 

share vital safety information within the business. We 

have also launched a Wellbeing calendar where we list 

monthly activities for staff, centred on improving their 

wellbeing and increasing knowledge around health and 

lifestyle. Our staff participate in challenging activities 

including pedometer challenges to encourage exercise 

and healthy lifestyle. 



Performance against our 2011-12 

targets 

Partnering with our charities 

In the last year, Hyder has committed its time, expertise 

and donated £55,000 directly to our six nominated charities. 

Our positive approach to engagement has been well received 

by our people as well as the charities. This has resulted 

in more than one hour per employee of time devoted to 

charitable work as well as an additional £35,500 raised by 

our staff and provided to charities and communities in and 

around the regions in which we operate. 

• WaterAid UK and WaterAid Australia: 

We have supported WaterAid’s objective to deliver safe 

water and sanitation to some of the world’s poorest 

communities. Both our UK and Australian regions 

have also supported WaterAid communities through 

significant volunteer work. For example, three highly 

motivated staff raised AUD2,500 for WaterAid by each 

undertaking their first Olympic-standard Triathlon. 

Hyder matched their fundraising dollar for dollar, 

raising a total of AUD5,000 for the charity. In the UK 

we have also appointed a dedicated WaterAid charity 

representative, who promotes the ways in which we 

can support WaterAid as well as build relationships 

with the charity. Both regions look forward to another 

year of exciting new opportunities to contribute to 

fundraising initiatives and to promote awareness for 

this important cause. 

• Sowers International: 

We believe that education is a powerful tool in helping 

the poor become more self-reliant hence our support 

of the educational development of poverty-stricken 

areas in China. Through various programmes, Sowers 

International support and plan the reconstruction 

of school buildings, provide education subsidies and 

also teacher training. This year, we sponsored five 

Hyder engineers from Hong Kong to help with the 

construction of several schools in a poverty-stricken 

area of the Guizhou Province, China: 

- Lixi Village Memorial Chan Hong Li SA-PH Primary 

School; 

- Paiguai Village SA-PH Primary School; and 

- Xiaoxi Village Kellogg-HKUST 2007 SA-PH Primary 

School 

Hyder’s staff also supported the charity through 

volunteer work – for example, taking part in a 

walkathon, a seven day cycle marathon along 

the legendary Silk Road, and a child sponsorship 

programme. 

• Ingenieur Ohne Grenzen (Engineers without 

Borders): 

Hyder’s donation is sponsoring the supply of water for a 

newly built school in Kadjebi, Ghana. The success of this 

school project has led to a subsequent project to build 

a school that benefits from renewable energy and green 

technology in Cameroon. Our staff are also engaged in 

monthly cake sales and office barbeques in our German 

offices to help raise money towards supporting a 

community in Tanzania. 

• International Federation of Red Cross and Red 

Crescent Societies: 

Our office in the Philippines was awarded a Platinum 

Plaque of Appreciation, the second in two years, in 

recognition of our assistance to the Philippine National 

Red Cross. As well as financial support, Hyder also 

donated 46 Red Cross disaster recovery kits to the East 

Rembo Elementary School in Makati City. Our pledge 

to increase voluntary aid saw 18 Hyder staff giving up 

their weekend to help build new homes for those who 

lost everything in the Ondoy disaster, a devastating 

typhoon which wiped out whole communities in 

the region. In Bangalore, Hyder donated disability 

equipment worth £3,000 to the Indian Red Cross 

Society Karnataka Branch in order to provide muchneeded 

help to the disadvantaged in the community. 

• Philippine Community Fund (Tondo School): 

Three years ago after several local engineering firms 

rejected a request for help, Hyder stepped in to support 

the Philippine Community Fund (PCF) build a school 

for over 1,000 local children living and working on the 

toxic Smokey Mountain dumpsite in Manila. Last year, 

as the Tondo School officially opened its doors to local 

children, Hyder pledged further expertise to the school 

as well as donating £25,000 to the school. Our donation 

covered the operating costs involved in educating a 

class of 35 students for the year, including all daily 

supplies; daily meals; teachers’ salaries; transportation; 

health checks and a field trip. 

Hyder people are very involved with the Tondo School 

and local community. Throughout the year, offices 

across the group purchased Winning Over Waste (WOW) 

recycled gifts, whilst some staff donated old school 

uniforms and equipment in the ‘Collect for a Cause’ 

campaign. Some dedicated staff also ran in a charity 

marathon - raising £3,000 for PCF. 

The most notable success in the year was the 

sponsorship by the company of two volunteers (both 

staff members) to live and work in Manila for three 

weeks supporting the school on the frontline. Read more 

about their experience in the case study on page 49. 

Case stud 


Katy and 

Sarah (Hyder 

employees) 

at the Tondo 

School 

Tondo School 

Supporting the communities in which we 

work and helping to end child labour. 

We realise that there is much more to do in supporting 

our charities than donating funds. Last year, as we 

strengthened our alliance with PCF, it was clear that Hyder’s 

time and expertise was just as valuable, if not more so, 

than financial support. We asked for volunteers to travel 

to Manila in the Philippines, to support the school Hyder 

helped to design and construct to witness first-hand the 

challenges of keeping the school running. 

Katy Roper (Ecologist) and Sarah Woodget (Geoarcheologist) 

both Hyder employees spent three weeks with the children 

and teachers of the Tondo School, teaching and organising 

practical lessons, chaperoning school trips and helping 

in the day to day running of the school. Sarah and Katy 

volunteered to share their skills and knowledge and bring 

back key learning to Hyder colleagues, they explain their 

experiences here: 

Hyder takes a big leap to actively support under privileged 

communities 

According to PCF, it is not common practice for corporate 

sponsors like Hyder to send staff out to volunteer at Tondo. 

Our presence in the school, around the children and visiting 

the dumpsite, was seen an opportunity for the charity to show 

outsiders what day-to-day life is really like for the children 

and their families living on the dumpsite and in the adjacent 

graveyard. 

What we hadn’t appreciated until we were in Tondo is how 

incredibly difficult it is to implement anything on the ground. 

What can seem like a very simple idea to us, for example 

composting leftovers from the school kitchen, represents an 

almost insurmountable hurdle. Because people have so little 

money and live so close to the breadline, they have very 

different priorities from ours. For example, they rely on food 

scraps we would think of as waste to feed their families and 

animals. 

hope of being able to escape their situation, it is necessary 

to provide at least some financial incentive so the school can 

obtain good teachers and social workers, and a variety of other 

staff who keep the school going. It is a constant balancing 

act for PCF - fundraising, improving the quality of life for the 

families and volunteers, and maintaining the focus on the 

children. 

Before we went, we had a number of lofty ideas for ‘projects’ 

to teach the students. Once we were there, implementing 

these were fraught with difficulty, and we discovered that you 

often feel that you haven’t achieved as much as you would 

like. Working in the Philippines presents all kinds of challenges 

which add to the difficulties of charity work – working through 

the red tape for example. What we did learn, however, is that 

just being there trying to help, is what really matters and 

makes a difference to the local community. 

What organisations like Hyder can do to help 

Obviously, the most important thing is raising and donating 

money! Seeing first hand why that money is needed and what 

it goes towards is very important in enabling this knowledge 

to be shared throughout the company, inspiring people to 

make a difference themselves and get involved. Fortunately, 

Hyder provides good encouragement and support for staff 

undertaking CSR activities and we’ve seen just how much of an 

impact this makes to these communities. 

Keeping our Hyder blog up to date while we were away kept all 

our colleagues across Hyder informed about our efforts. It was 

great to have so much positive feedback, people were obviously 

proud to be working for a company who were prepared to send 

volunteers out to really make a difference. It was encouraging 

to hear that we had inspired more staff to sponsor Tondo 

children as a direct result of reading about our experiences. 

Whilst people pay £20 a month to sponsor a child, it actually 

costs PCF over £60 a month. This is why continuing to recruit 

sponsors, volunteer and make financial donations is so critical. 

To find out more about PCF, or if you are interested in 

helping the Tondo School, please contact Nana Berchie 

(nana.berchie@hyderconsulting.com) or go to PCF’s website 

(www.p-c-f.org). 

Focused on what matters 

The main priority for PCF is the children. However, in order to 

provide an adequate education that will give the children some 



PCF handmade 

recycled 

jewellery made 

in the Tondo 

School 

Tondo School, building, 

wash area and canteen 

Katy and Sarah 

teach a class 

at the Tondo 

School 

Excellence for our clients: 

sustainability and preserving the 

environment 

At Hyder we know that sustainability is increasingly an 

important driver for many of our clients. Sustainability 

in design is not about the consideration of specialist 

‘optional extras’; it is the use of our skills and innovation 

to create good-quality designs which make the best use of 

resources and add value over the life of a scheme. Through 

our projects we aim to help our clients enhance their 

communities from a social and economic perspective and 

preserve or improve the environment. 

Sustainability wins: The Enzdüker water 

project awarded twice 

the city of Pforzheim, south of Germany, Hyder has been 

commissioned to improve and modernise the city’s drainage 

system. This project called on our team of water experts 

to develop an efficient concept using air-cushioned culvert 

technology, implemented only eight times previously in 

Europe. 

The main objectives of the project are to increase the 

hydraulic capacity of the city’s wastewater systems, 

improve environmental management by minimising polluted 

water entering the Enz and Nagold rivers, and reconstruct 

defective sections of the 100-year-old sewer system. 

Hyder has been widely recognised for our innovative 

approach and the positive impact created for the 

environment. The Enzdüker project won the 2011 German 

Society for Trenchless Technology (GSTT) gold medal and the 

award for “Best Water Conservation Project” in the 2011 Big 

Project + BGreen Awards. 

As part of a recent contract win of a water project by 


Conceptual Master Planning: Linyi Tusu 

Island 

Tusu Island is the biggest island on river Fang of Linyi 

city, China, a highly significant part of the Linyi eco 

city wetland system. Hyder/ACLA has been appointed to 

prepare a conceptual master plan to develop the island 

and surrounding area as a comprehensive ecotourism 

destination. Our design features a diverse and accessible 

waterfront environment and ecologically sound development 

with tourism and cultural industry as its principal drivers 

for economic growth. The overall vision is to integrate the 

development with the local eco system to create a vibrant 

and environmentally sustainable destination to live, work 

and play. 

Sustainable project of the year award: A40 

carriageway 

Hyder often works as part of an integrated team to improve 

the sustainability of projects. The A40 Penblewin-Slebech 

Park scheme is one such example, where our ecologists 

have worked in a long-standing partnership with Costain 

and Atkins. The team were awarded the ‘Project of the Year 

Award’ from Constructing Excellence Wales and the judges’ 

cited: 

“The project team demonstrated unrivalled best practice 

and partnership in the design and build of this new format 

carriageway ... Its approach to major environmental issues 

and its commitment and enthusiasm in relation to the 

surrounding community ... was exemplified by over 600 site 

visits hosted for members of the public and others. It has 

set new highways engineering standards in Wales”. 

Hong Kong Greening Master Plan 

After working successfully on the first four phases of the 

Greening Master Plan (GMP) for Hong Kong, Hyder/ACLA has 

now been awarded the fifth phase. The GMP is the single 

largest landscape and urban improvement project ever 

awarded by the Hong Kong Government. The master plan 

will realise the aspirations of Hong Kong residents for an 

improved quality of life and a better living environment. The 

before and after images show what a difference this master 

plan makes to the community and environment. 

CSR on the agenda 

Hyder’s senior management team is 

showing the way: 

Sustainability and issues related to the environment are 

now standard agenda items at Hyder UK management 

meetings. Critical issues and progress are regularly 

communicated to staff supported by articles in internal 

newsletters, on the intranet and posters to keep staff 

well informed. 

Our commitment to partnership 

CSR is ingrained in all aspects of our work. We recognise 

that Hyder’s expertise can make an important contribution 

to society and a positive difference to the communities in 

which we operate. 

Supporting our people 

We believe in investing in our staff’s careers, supporting 

their professional development and giving them the tools 

and training they need to become caring citizens wherever 

they work. We encourage Hyder people to work closely with 

communities in which we operate. We recognise that there 

are differences between our regions not only in legislation 

but also with local customs and values. However, all our 

staff are expected to meet strict guidelines around business 

ethics and conduct. 

Partnership with our clients 

A central objective of our work is to contribute to the 

realisation of long-term environmental, social and economic 

benefits for our clients and their communities, and to 

incorporate sustainable practices effectively into our 

activities. 

Before... ... After 

Landscape 

design, 

planning and 

greening, 

Hong Kong 



Working with our suppliers 

We strive to maintain sustainable economic, environmental 

and social practices in every aspect of our work and 

encourage our suppliers to do the same. Through our 

procurement policy, we actively manage the environmental 

and social consequences of our operations. Hyder undertakes 

responsible procurement and where possible, uses suppliers 

based within the country of operation, to contribute to the 

local economy and community. Every individual involved in 

purchasing and supply management processes, endeavours 

to ensure that our purchasing activities are accountable 

and auditable, economically effective, as well as ethically, 

environmentally and socially responsible. 

Our investors 

We are committed to the highest levels of ethical behaviour. 

Last year we reviewed and updated our corporate Ethical 

Business Code and ensured clear understanding of our 

policy through the introduction of targeted training and 

communications programmes. 

Supporting education 

Hyder does not participate in nor support child labour 

under any circumstances. We work with our community 

and charity partners to actively support the development, 

education and welfare of children and their families in 

several countries, particularly the Philippines where we have 

designed the Tondo School and donate money to sponsor a 

whole class for a year. 

Sharing our expertise 

We actively participate in professional 

communities, sharing our expertise and 

best practice. Here are some examples 

from last year: 

• Discussion paper, ‘Climate Change Adaptation 

Planning – Building Chinese Capacity’, presented at 

the China-Australia Building for Strategic Planning 

in Climate Change conference: Brad Searle and Sam 

Pollard; 

• Article in Young Engineer’s Australia newsletter, 

‘Nuclear Power Station Design’, the paper provided 

understanding on the structure of nuclear plants 

and steps taken to secure a site after a natural 

disaster such as in Japan: Elizabeth Smolinska; 

• Discussion paper, ‘Waste management overview of 

New Zealand’, written in the Chartered Institution 

of Wastes Management Journal (UK). Also 

presented at the Zero Waste 2011 Conference: 

Victoria Bond. 

Cycling for 

Education, 

Silk Road, 

Sowers 

Charity 

Hyder supports 

education in rural 

China 

School canteen 

of Lixi Village 

Memorial Chan 

Hong Li SA-PH 

Primary School, 

Guizhou Province 


Improving our economic, 

environmental and social 

performance 

We publish our corporate approach to social, environmental 

and economic considerations as part of our objective to 

communicate our accountability to internal and external 

stakeholders and to ensure consistency with the industry 

standard. 

Tracking our environmental performance 

Materials 

used 

Direct energy 

consumption 

by primary 

energy source 

Indirect 

energy 

consumption 

by primary 

source 

As a consultancy, Hyder’s principal 

material used is paper. Across the group 

101,582.6 kgs of paper was consumed 

which equates to 10.2 reams of paper 

per employee through the reporting 

period. 

Hyder uses natural gas in some of our 

offices. Use through the reporting 

period totals 4,098 GJ. This represents 

a decrease of 39.6% over the previous 

reporting period. The decrease in gas 

use is attributable to two main reasons: 

1. In previous reports Hyder has 

assumed a gas use figure for 

Germany based on the financial 

value of the bills received. This 

year we were able to extract the 

usage data directly. Gas use was 

over 60% lower than previous 

assumptions. 

2. Office consolidation over the past 

year and better use of available 

space in Hyder UK offices has added 

to the reduction in gas use with a 

UK decrease of 40%. 

Electricity is used in all Hyder offices. 

Usage amounts to 16,173 GJ per annum 

across the group, which assuming 

all electricity purchased comes from 

fossil fuel stations running at 40% 

efficiency, corresponds to 40,432.5 

GJ of primary energy. This usage 

corresponds to a reduction of 12.3% 

over the previous reporting period. As 

well as greater awareness of the need 

to reduce electricity use in our offices, 

this decrease also shows the results of 

better use and consolidation of office 

space including some office closures. 

Total direct 

and indirect 

green-house 

gas emissions 

by weight 

Other 

relevant 

indirect 

green-house 

gas emissions 

by weight 

Direct and indirect greenhouse 

emissions related to Hyder’s energy 

consumption total 3,310.8 TCO2 through 

the reporting period, which corresponds 

to 0.87 TCO2 per employee. Total output 

represents a decrease of 25.3% on the 

previous reporting period. Output per 

employee shows a decrease of 27.4%. 

This reduction is the result of the 

combination of decrease in direct and 

indirect energy use as explained above. 

Indirect greenhouse gas emissions are 

calculated for Hyder using air travel 

only. Greenhouse gas emissions arising 

from business related air travel totals 

2,108.2 TCO2 which corresponds to 0.56 

TCO2 per employee. This represents an 

increase of 28.8% and 25.5% over the 

figures reported for 2011-12. 

The air travel requirements of 

the business are driven by client 

requirements, the increase in travel is 

down to: 

• Increased travel from Germany 

to the Middle East in relation to 

specific projects including the Doha 

Metro and Siemens project in Saudi 

Arabia, as well as the establishment 

of a Global Excellence Centre in 

Sofia, Bulgaria. 

• Greater travel from all regions to 

Global Excellence Centres in Manila 

and Bangalore to support client 

projects. 

• An increase in travel from within 

Asia to support the growth in 

China. 



Data 

Energy Air Travel Total 

TCO 2 

TCO 2 

/ person TCO 2 

TCO 2 

/ person TCO2 TCO2 / person 

Australia 881.4 1.21 717.9 1.00 1,599.3 2.21 

Asia 283.5 0.57 239.8 0.52 523.3 1.09 

Middle East 880.8 0.82 593.2 0.53 682.0 1.35 

UK 1,018.7 0.91 391.5 0.36 1,410.2 1.27 

Germany 246.4 0.64 165.9 0.43 412.3 1.07 

Totals 3,310.8 0.87 2,108.3 0.55 5,419.1 1.43 

Change on 2011 (25.3%) (27.6%) 28.8% 25.2% (10.7%) (13.2%) 

Notes: Basis for calculations 

Headcount is the average rolling headcount number for the reporting 

period (April 1 2011 – March 31 2012). 

Energy use 

Data for the UK is based on figures from Hyder offices at Bristol, Cardiff, 

Exeter, Guildford, Plymouth, Stroud and Warrington and extrapolated 

to cover a full 12 months (where data was not available) and total UK 

headcount. 

Middle East data has been extrapolated to cover a full 12 month period 

where some data was not available. Middle East region also includes 

Manila operations. 

Conversion factors taken from the UK Department for Environment, 

Food and Rural Affairs (DEFRA) and also International Energy Agency 

publication – CO2 emissions from fuel combustion 2011 edition. 

Air travel 

Conversion factors have been sourced from DEFRA. 

Safety culture at Hyder 

We are committed to providing a high level of health 

and safety (H&S) for all staff, clients and stakeholders 

throughout all our regions. We have been awarded another 

Royal Society for the Prevention of Accidents (RoSPA) 

Gold Medal, reflecting our achievement in obtaining nine 

consecutive RoSPA Gold Awards in the UK. 

Hyder’s award for Systems Excellence and our Occupational 

Health and Safety management system in Australia, is 

a reflection of our business policy in rolling out good 

practice from our more established regions to other regions 

developing their own Health and Safety management 

system. 


The introduction of a new group induction programme 

ensures every employee is inducted into our H&S 

management system which lays out the procedure for taking 

responsibility for the individual’s safety as well as the safety 

of their colleagues’. 

This year our injury rates and number of incidents were 

reduced significantly, with only the Middle East region 

recording safety incidents. 

Injury Rate 

(IR)* 

Lost Day 

Rate (LDR) 

No. of 

incidents 

Australia - - - 

Asia - - - 

Middle East 179 - 1 

UK - - - 

Germany - - - 

*Notes: Basis for calculations 

IR = No. of incidents x 200,000/number of staff and LDR = number of lost 

days x 200,000/number of hours worked (days are work days, factor of 

200,000 used to derive injury rate). Refer to company overview for total 

workforce breakdown by region. The above figures do not include minor 

injuries. 

Knowledge sharing 

Hyder embraces modern technology to minimise the carbon 

footprint of our travel; our latest BIM (building information 

modelling) models for example, can be shared on multiple 

screens around the globe in real time during OCS conference 

calls. This use of VOIP technology is blended with highly 

skilled teams on the ground, so sharing our knowledge has 

never been easier or more sustainable.

Next year’s CSR objectives 

Donating and supporting our charities 

In 2012, we will support the following seven charities 

through donations totalling £55,000 and by providing our 

people’s skills and expertise to assist with their projects. We 

will also continue to support the Tondo School by donating 

£25,000 of the total charitable donations, towards the 

sponsorship of a class as well as other Tondo School-related 

projects. 

Region 

Australia 

Asia 

Middle East 

UK 

Germany 

The 

Philippines 

India 

Charity 

WaterAid Australia 

Sowers International & Habitat for 

Humanity (HfH) 

Shafallah Centre for Children with 

Special Needs 

WaterAid UK 

Ingenieur Ohne Grenzen 

The Philippine Community Fund 

(Tondo School) 

Red Cross 

Our objective is to increase our people’s engagement with 

our charities through direct involvement with each of the 

charities, a minimum of one hour per person. We also aim 

to generate and implement one initiative per charity via the 

CSR forum. 

Maintaining and sharing CSR best practice 

We are committed to upholding CSR best practice across 

Hyder. Our best practice objectives are as follows: 

• To review and refresh our existing Approved Supplier 

Database (ASD), and develop a supply chain risk 

assessment process, which improves our ability to 

demonstrate knowledge and expertise and performance 

feedback for our suppliers. 

• To develop initially in the UK, a comprehensive Project 

Environment Assessment framework that supports our 

project due diligence and strategic decision making 

process. 

• To further develop our Environmental Management 

System in each region, which will lead us to implement 

a structure suitable to obtaining ISO14001 within two 

years in Germany, Asia and the Middle East, following 

the UK and Australia’s example having already been 

accredited. 

• To further promote our CSR activities and support for 

our chosen charities through our CSR network and 

business forum, with an opportunity to measure staff 

response and business initiatives. 

• To empower staff to suggest, support and where 

appropriate implement sustainable practices across all 

our office locations, measured by a target of one new 

sustainable practice per office by the year end. 

• To monitor and report on social employment status 

(equality, diversity and inclusion). 

• To continually innovate and deliver sustainable 

designs, we aim to introduce concepts within the Hyder 

Heartbeat into all regions. 

• To undertake Corporate Social Responsibility Index 

benchmarking by completing an industry benchmarking 

report. 

• To comply with industry sustainability reporting 

standards in Hyder’s CSR reporting through the Global 

Reporting Initiative’s (GRI). 

Patrick James, 

Principal site 

ecologist inspects 

a tree for potential 

bat roosts 

Doormouse 

from Strawberry 

Banks, voluntary 

monitoring 



‘Tree Planting’ day, Hyder 

works with the Red Cross and 

local Philippine Army Platoon 

Hyder donates disaster 

recovery kits 

Building new homes for 

Typhoon Ondoy victims, 

Philippines 

Improving our environmental performance 

• To continue to reduce our carbon footprint through 

our ‘carbon profile’ for the vehicle fleet in each region, 

improvements to be phased in over the next three to 

four years as leases are renewed. 

• To implement a more consistent approach for capturing 

data and benchmark our performance as measured in 

2012-13 industry benchmarking. 

• To appoint a suitable individual to be the Regional 

Environmental Management Advisor (REMA) in each 

region, each REMA reporting directly to their Regional 

Board. 

• To set region-specific targets for environmental 

performance. 

Training and awareness 

• To further cultivate our stakeholder engagement around 

environmental issues, we will develop a stakeholder 

communication and engagement plan, from which we 

will develop an annual survey with our stakeholders to 

analyse our activities and improvement outcomes. 

• To encourage knowledge-sharing with our charity 

partners and stakeholders we will offer training places 

where suitable and extend our training programmes 

to include relevant business practices. Our target is to 

offer one training programme to each charity partner a 

year. 

• To increase awareness of reducing child labour by 

offering partners and clients the opportunity to learn 

about and donate to the charitable Tondo School. 

Hyder donates 

medical supplies 

and equipment 

through the Red 

Cross Society, 

India 


Our performance against 2011-12 objectives 

Last year’s CSR objectives 

We reviewed our approach for capturing data 

Reduced our carbon footprint by 5% 

We began a review of our procurement processes and actions in our other regions 

Further developed our environmental management system in the UK and Australia 

We undertook CSR Index benchmarking 

Our CSR report complied with industry reporting standards 

Regular promotion of Hyder’s CSR activities to our staff and the wider community 

In excess of 90% of staff participated in training associated with our ethical business code 

We developed a group sustainability policy framework for our clients and project work 

Targets 

met 

 

 

 

 

 

 

 

 

 

We produce an annual CSR report to demonstrate our commitment and progress towards becoming a more environmentally and socially 

responsible business. We recognise the resultant benefits for our clients, our people and for the communities in which we work and this report 

is written primarily for them. Unless otherwise stated, figures in this report relate to the 2011-12 reporting year and cover all the group’s 

operations. Our report has been written within the GRI sustainability reporting framework, disclosing outcomes and results within the 2011-12 

reporting period. 

Donating employee time, 

Philippines 


Improving the scenery: Hong 

Kong Greening Master Plan 

Before 

After 

The Hong Kong Greening Master Plans (GMPs) 

differ from most landscape design projects. Where 

other landscape design projects attempt to ‘retrofit’ 

an existing infrastructure that is in many instances 

hostile to greening and jammed with conflicting 

demands for limited available space - the GMP project 

seeks to define the greening framework of an area 

and its particular needs. The GMPs project provide a 

guide to the planning, design and implementation of 

greening works, to achieve extensive, consistent and 

sustainable greening works. 

To date, Hyder has been commissioned on six GMP assignments 

in Hong Kong. The majority of new greening we have proposed 

has been carried out on government land, mainly consisting of 

wide footpath areas, road medians and traffic islands. 

Benefits 

• trees will bring substantial benefits, enhancing the quality 

of urban environment and uplifting the aesthetic quality of 

the urban fabric 

• efficiently brings people closer to nature 

• educational value and health benefits 

• positive psychological benefits for the community 

• cultural value and financial value. 

Results and achievements 

Despite uniquely challenging physical constraints and public 

pressures, the GMPs have successfully resulted in the planting of 

25,160 trees and 5,295,000 shrubs in the urban areas to date, 

of which 23,910 trees and 4,995,000 shrubs were planted under 

Hyder contracts. 

The planting has been well received by the public largely 

because of the dramatic local environmental improvements 

brought about by the implementation of the GMPs. It is this 

social and psychological impact of the greening, and the 

localized shading and cooling effects that are the preeminent 

benefits. 


GIS Data Management – A Geographic Information System 

(GIS) integrates hardware, software, and data for capturing, 

managing, analyzing and displaying all forms of geographically 

referenced information. We have been able to consolidate 

our wealth of experience as well as introduce our new and 

innovative mobile GIS system. Handheld iPAD units integrate 

more closely the actual on-site conditions with the design 

drawings, capturing and processing more accurately the vast 

amounts of data collected. 

Client: Civil Engineering and 

Development Building, The Government 

of the Hong Kong Special Administrative 

Region 

Period: 2005-ongoing 

Services: Investigation, feasibility study, 

master planning and detail design. 


Directors’ Report 

General Information 

and Disclosures 


Business Review 

The company is the holding company for the Hyder 

Consulting group of companies. Detailed information on the 

group’s principal activities and the other information which 

meets the requirements of the business review as required 

by section 417 of the Companies Act 2006 and which should 

be treated as forming part of this report by reference are 

to be found in the Business Review and in the Chairman’s 

Statement at pages 10 to 30 of this Annual Report. 

Results and dividends 

The results include those of Hyder Consulting PLC and its 

subsidiaries for the financial year ended 31 March 2012 

and are set out in the Financial Statements on pages 73 to 

116. The profit before taxation amounted to £17.6m (2011: 

£18.2m). Profit after taxation was £13.9m (2011: £14.9m). 

The directors recommend a final dividend for the year to 

31 March 2012 of 7.00p per share (2011: 6.00p), to bring 

the total for the year to 9.00p (2011: 7.75p), an increase of 

16.1% over last year. The full year dividend is covered 4.9 

times by adjusted fully diluted earnings per share (2011: 5.6 

times). The dividend, if approved by the shareholders, will 

be paid on 10 August 2012 to shareholders on the register 

on 13 July 2012. 

Dividend waivers 

A dividend waiver is currently in operation in respect of 

all shares held by EES Trustees International Limited, the 

trustee of the Hyder Consulting PLC Employee Benefit Trust. 

The trustee does not exercise its right to vote in respect of 

any of the shares held by it. As at 13 June 2012 the trust 

held 801,976 shares in the company (2.1% of the issued 

share capital). 

Directors and their interests 

Details of the directors of the company are given on page 32 

and 33. 

Details of directors’ interests in shares of the company are 

included in the Directors’ Remuneration Report on page 69. 

There were no significant contracts subsisting during or 

at the end of the year with the company or any of its 

subsidiaries in which any director is, or was, materially 

interested, other than the service contracts and letters 

of appointment referred to on page 68 of the Directors’ 

Remuneration Report. 

Corporate responsibility 

The company’s Corporate Social Responsibility Report for 

the year has been incorporated into this Annual Report and 

Financial Statements on pages 42 to 57. 

Share capital 

The company’s share capital comprises a single class of ordinary 

shares of 10p each and as at 31 March 2012 there were in issue 

38,634,530 (2011: 38,540,280) fully paid ordinary shares. 

Throughout the year, the ordinary shares were listed on the 

official list of the UK Listing Authority and remain so at the date 

of this report. There are no specific restrictions on the size of 

a shareholding or on the transfer of shares (apart from where 

a share is not fully paid up). The directors are not aware of any 

agreements between holders of the company’s ordinary shares 

which may result in restrictions on the transfer of shares or on 

voting rights. 

Directors’ powers in relation to allotment 

and buy-back of shares 

The powers of the directors to issue or buyback shares in 

the company are restricted to those approved each year at 

the company’s AGM or, if any intervening need arises for 

shareholders to grant any additional powers, those approved 

in a general meeting specifically convened for that purpose. 

The company did not buyback any of its shares in the 

financial period under review or to 13 June 2012. 

Rights attaching to shares 

General 

The rights attaching to the ordinary shares are set out 

in the company’s articles of association. The articles 

of association may only be amended or replaced with 

the approval of the company’s shareholders by a special 

resolution at a general meeting of the shareholders. 

A shareholder whose name appears on the register of 

members may choose whether their shares are evidenced by 

share certificates (i.e. are held in certificated form) or held 

in electronic form in CREST (i.e. un-certificated). 

If the company is wound up the liquidator may, with the 

sanction of a special resolution of the company, and 

any other sanction required by law, divide among the 

shareholders (excluding any shareholder holding shares 

as treasury shares) the whole or any part of the assets of 

the company. He may, for such purposes, set such value 

as he deems fair upon any property to be divided and may 

determine how such division shall be carried out as between 

the shareholders. The liquidator may also transfer the whole 

or any part of such assets to trustees to be held on trust for 

the benefit of the shareholders, but no shareholder shall be 

compelled to accept any assets on which there is a liability. 

Votes at general meetings 

Subject to the restrictions set out below, a shareholder 

is entitled to attend (or appoint another person as his 

representative to attend i.e. proxy) and to exercise all or 

any of his rights to speak and vote at any general meeting 


of the company. A shareholder may also appoint more than 

one representative. A representative need not also be a 

member of the company. 

To be valid, any form of proxy sent by a shareholder to 

the company or, where permitted, any proxy registered 

electronically in relation to any general meeting must be 

received at the address provided in the notice not later than 

48 hours before the time fixed for holding the meeting (or 

any adjourned meeting). 

Subject to any special terms regarding voting upon which 

any shares may for the time being be held, upon a show 

of hands every shareholder (or his representative) who is 

present in person at the general meeting shall have one vote 

and upon a poll every shareholder (or his representative) 

present in person shall have one vote for every share held 

by him on each resolution put to the meeting, save that, if 

a shareholder appoints more than one representative, the 

representatives appointed by that shareholder shall have 

only one vote between them and, if they purport to vote in 

different ways, their vote shall not be counted. 

If a person fails to give the company any information 

requested by a notice served on him under section 793 of 

the Companies Act 2006 (which gives public companies 

the power to require information to be supplied in respect 

of a person’s interests in the company’s shares) then the 

company may, not earlier than 21 days later, and after 

warning that person, serve a disenfranchisement notice 

on the registered holder of the shares or shares in respect 

of which the section 793 notice was given. Unless the 

information required by the notice is given within 14 days, 

the holder will not be entitled to receive notice of any 

general meeting or attend any such meeting and shall not 

be entitled to exercise, either personally or by proxy, the 

votes attaching to such share or shares in respect of which 

the disenfranchisement notice has been given unless and 

until the information required by the section 793 notice has 

been provided. 

Proceedings at general meetings 

At every general meeting each resolution shall be decided 

in the first instance on a show of hands unless on, or before, 

the declaration of the result of the show of hands, a poll 

is demanded by (a) the chairman of the meeting, (b) at 

least five shareholders present in person or by proxy having 

the right to vote on the resolution, (c) a shareholder or 

shareholders present in person or by proxy representing 

in aggregate not less than one-tenth of the total voting 

rights of all the shareholders having the right to vote on 

the resolution, or (d) a shareholder or shareholders present 

in person or by proxy holding shares conferring the right 

to vote on the resolution on which an aggregate sum has 

been paid up equal to not less than one-tenth of the total 

sum paid up on all the shares conferring that right. On a 

poll, every shareholder (or his representative) present at the 

meeting has one vote for every ordinary share in respect of 

which he is the registered holder, save that, if a shareholder 

appoints more than one representative, the representatives 

appointed by that shareholder shall have only one vote 

between them. 

Modification of rights 

If at any time the capital of the company is divided into 

different classes of shares, the rights attached to any class 

may be modified, abrogated or varied either (a) with the 

consent of the holders of three-fourths in nominal value of 

the issued shares of that class (excluding any shares of that 

class held as treasury shares) or (b) with the sanction of a 

special resolution passed at a separate general meeting of 

the holders of shares of that class. 

Appointment and removal of directors 

Directors may be appointed by shareholders (by ordinary 

resolution at a general meeting) or by the board. Any 

director appointed by the board may only hold office until 

the date of the next AGM, at which time the director must 

stand for election by shareholders. 

The articles of association require one-third of the directors 

to retire by rotation at each AGM. The directors to retire 

are selected by reference to those who have been in office 

longest since their election or last re-election. Any director 

who has been in office for more than three years since 

their election or last re-election must offer themselves for 

re-election at the next AGM. The board has determined that 

going forward all directors should retire and where eligible, 

seek re-election annually at the AGM. This will also more 

than satisfy the retirement by rotation requirements of the 

articles of association. 

The company may by ordinary resolution remove any 

director before the expiration of his period of office. 

Amendments to the company’s articles of 

association 

The company’s articles of association may be amended by 

way of a special resolution at a general meeting of the 

shareholders. 

Substantial shareholdings 

As at 8 June 2012, the company had, in accordance with the 

Disclosure Rules and the Transparency Rules of the Financial 

Services Authority, been advised of the following notifiable 

interests in the shares of the Company which exceeded the 

3% notification threshold: 

Shareholding Percentage 

BlackRock Inc 2,260,120 5.85% 

JP Morgan Asset 

Management 

Holdings Inc 2,184,017 5.65% 

T Rowe Price 

Associates Inc 2,062,165 5.33% 

Legal and General 

Group PLC 1,260,871 3.26% 


Directors’ Report General Information and Disclosures continued 

Annual general meeting 

The notice of the 2012 AGM to be held on 2 August 2012 

and an explanation of the resolutions proposed are set out 

in the separate circular sent to those shareholders who have 

opted to continue receiving paper communications, which 

is also available to other shareholders and the public on our 

website at www.hyderconsulting.com. 

Policy on the payment of suppliers 

It is the group’s policy to seek to agree terms of payment 

with suppliers when agreeing the terms of a transaction and 

to abide by those agreed terms of payment. Where payment 

terms are not negotiated and agreed the company and 

group endeavour to adhere to suppliers’ standard terms. The 

average payment period was 53 days (2011: 57 days) and the 

ratio of amounts owed to trade creditors at the end of the 

year to the aggregate amounts invoiced by suppliers during 

the year was 15% (2011: 16%). 

Financial instruments 

As at 31 March 2012 the group had a number of financial 

instruments, and disclosures for these items can be found in 

note 15 to the Financial Statements on pages 96 to 100. The 

group’s approach to financial risk management can be found 

on page 96. 

Research and development 

The group strives to develop and implement innovative 

technical solutions for its clients. In the year this has 

resulted in research and development tax credits in the UK 

and Australia, which have contributed to the group’s current 

low tax rate. 

The group’s global intranet, community interest groups and 

databases help our people to identify, develop and share 

these technical advancements. 

Charitable and political donations 

During the year donations made for charitable purposes 

amounted to £55,000 (2011: £55,083). No political 

donations were made during the year (2011: nil). 

Employment practices and policies 

Details of the company’s employment practices and policies 

are set out in the business review on pages 20 to 22. 

Health and safety 

We believe that the wellbeing of our people is of paramount 

importance. Our commitment to health and safety is 

demonstrated by our group health and safety policy, with its 

supporting framework and reporting structure. This is further 

enhanced by the appointment of regional health and safety 

staff, and locally based systems in all of our geographies. 

Safe working practices are emphasised throughout the group. 

We provide health and safety services to clients in all sectors 

under the Construction (Design and Management) Regulations 

in the UK. 

Significant agreements 

Under section 416 of the Companies Act 2006, the company 

is required to identify significant agreements that take 

effect, alter or terminate upon a change of control of the 

company following a takeover bid and the effects of any such 

contracts. The group’s principal banking facilities contain 

provisions which allow the relevant bank to terminate its 

facility and demand repayment of all sums due to it under 

the facility either on a change of control of the company or 

alternatively on an application being made for a delisting of 

the company’s shares following such a change of control. 

The group’s share schemes also contain provisions relating 

to the vesting of awards/options in the event of a change of 

control of the company. 

Post balance sheet events 

There are no post balance sheet events that require 

disclosure in this Annual Report. 

Statement of directors’ responsibilities 

The directors, as listed on page 32, are responsible for 

preparing the Annual Report and the group and the company 

Financial Statements in accordance with applicable law and 

regulations. 

Company law requires the directors to prepare financial 

statements for each financial year. Under that law the 

directors have prepared the group Financial Statements in 

accordance with International Financial Reporting Standards 

(IFRS) as adopted by the European Union and the company 

Financial Statements in accordance with applicable law and 

United Kingdom accounting standards (United Kingdom 

Generally Accepted Accounting Practice (UK GAAP)). Under 

company law the directors must not approve the group and 

company Financial Statements unless they are satisfied that 

they give a true and fair view of the state of affairs of the 

group and the company and of the profit or loss of the group 

and the company for that period. 


In preparing those Financial Statements, the directors are 

required to: 

• select suitable accounting policies and then apply them 

consistently; 

• make judgements and estimates that are reasonable 

and prudent; 

• state that the group Financial Statements comply with 

IFRS as adopted by the European Union and with regard 

to the company’s Financial Statements that applicable 

United Kingdom accounting standards have been 

followed, subject to any material departures disclosed and 

explained in the respective Financial Statements; and 

• prepare the group and company Financial Statements 

on the going concern basis unless it is inappropriate 

to presume that the group will continue in business, in 

which case there should be supporting assumptions or 

qualifications as necessary. 

The directors are responsible for keeping adequate 

accounting records that are sufficient to show and explain 

the company’s transactions and disclose with reasonable 

accuracy at any time the financial position of the company 

and the group and enable them to ensure that the Financial 

Statements and the Directors Remuneration Report comply 

with the Companies Act 2006 and, as regards group 

Financial Statements, Article 4 of the IAS Regulation. They 

are also responsible for safeguarding the assets of the group 

and the company and for taking reasonable steps for the 

prevention and detection of fraud and other irregularities. 

The directors are responsible for the maintenance and 

integrity of the corporate and financial information included 

on the company’s website. Legislation in the United 

Kingdom governing the preparation and dissemination of 

Financial Statements may differ from legislation in other 

jurisdictions. 

The directors confirm that, to the best of their knowledge: 

(a) the group and the company’s Financial Statements 

in this Annual Report, which have been prepared in 

accordance with IFRS and UK GAAP respectively, give 

a true and fair view of the assets, liabilities, financial 

position and profit or loss of the group and the 

company taken as a whole; and 

(b) the management report (which comprises the 

Chairman’s Statement and the Directors’ Report) 

includes a fair review of the development and 

performance of the business and the position of the 

group and the company taken as a whole, together with 

a description of the principal risks and uncertainties 

that they face. 

Going Concern 

After making enquiries, the directors have a reasonable 

expectation that the company and the group have adequate 

resources to continue in operational existence for the 

foreseeable future and therefore continue to adopt the 

going concern basis in preparing the Financial Statements. 

Auditors 

PricewaterhouseCoopers LLP has indicated its willingness 

to continue as independent auditors to the group and a 

resolution for its reappointment will be proposed at the 

2012 AGM. 

Disclosure of information to Auditors 

In accordance with section 418 of the Companies Act 2006 

each of the directors, as listed on page 32, confirms that, 

so far as he is aware, there is no relevant audit information, 

that is, information needed by the company’s auditors 

in connection with preparing their report, of which the 

company’s auditors are unaware, and that he has taken all 

steps that he ought to have taken (as detailed in section 

418) in order to make himself aware of any relevant audit 

information and to establish that the company’s auditors are 

aware of that information. This confirmation is given and 

should be interpreted in accordance with section 418 of the 

Companies Act 2006. 

Cautionary statement 

This Annual Report and Financial Statements has 

been prepared solely for the benefit of the company’s 

shareholders, as a body. The company, the directors and 

employees accept no responsibility to any other person 

for anything contained in them. They may contain 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 forwardlooking 

statement reflects knowledge and information 

available at the date of preparation of this Annual Report 

and Financial Statements 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 Annual Report and Financial 

Statements should be construed as a profit forecast. 

This Directors’ Report (including the content of the 

Chairman’s Statement which is deemed incorporated 

into this report by this reference) has been drawn up 

and presented in accordance with and in reliance upon 

applicable English company law and the liabilities of the 

directors in connection with this report shall be subject to 

the limitations and restrictions provided by such law. 

By order of the board 

Neil Hunt 

Company Secretary 



Directors’ 

Remuneration 



This report has been prepared by the remuneration 

committee and has been approved by the board. Not all of 

the information in this report is required to be audited and 

the information is not covered by the auditors’ report unless 

otherwise indicated. A resolution will be proposed at the 

2012 AGM inviting shareholders to approve this report. 

Committee membership and meetings 

The remuneration committee comprises non-executive 

members of the board of directors with written terms of 

reference, which are available on the company’s website 

www.hyderconsulting.com. Members who served on the 

committee during the year were Paul Withers, its chairman, 

and Jeffrey Hume both of whom the board has determined 

are independent. 

The committee has responsibility for setting the 

remuneration policy and remuneration packages of the 

chairman, the executive directors, the company secretary 

and senior executives below the board who report to the 

chief executive. This includes assessing awards under annual 

incentive schemes, establishing performance targets for 

future annual incentive schemes, and the grant of options 

under the company’s share schemes. 

The committee met four times during the year covered by 

this report. The chairman, chief executive, group finance 

director and group HR and communications director attend the 

meetings by invitation as appropriate. No director is present 

when a decision relating to their own remuneration is made. 

During the year the committee engaged New Bridge Street 

(part of Aon plc) to advise on executive director remuneration, 

and retained Deloitte LLP to advise in respect of the Hyder 

Consulting Long Term Incentive Plan 2006 (“LTIP”). New 

Bridge Street did not provide any other services to the 

company during the year. Deloitte LLP was retained by the 

company during the year to provide tax advice. 

Remuneration policy 

The company’s remuneration policy is intended to motivate, 

retain and attract high calibre executives by rewarding them 

with an appropriate and competitive salary and benefits 

package that is linked to both individual and business 

performance, is closely aligned with executing the group’s 

business strategy and enhancing shareholder value, and 

takes into account the market for executives in similar roles 

in similarly-sized companies and those operating in the 

same sector. This policy was applied during the year and 

will, subject to regular review, be applied during the current 

and future years. 

Remuneration information 

The main elements of the remuneration packages agreed 

by the committee for the executive directors in the year 

are: base salary, short-term incentives through an annual 

performance related bonus, long-term incentives through 

awards under the LTIP, pension, permanent health insurance, 

and life assurance benefits. 

The committee keeps under review the structure and 

weighting of the different elements of the executives 

package to incentivise an entrepreneurial approach without 

promoting excessive risk. The committee is satisfied that 

the packages are appropriately balanced between fixed and 

performance related remuneration. Short-term incentives 

provided through annual bonuses do not exceed 100% of 

base salary. Targets for both short-term and long-term 

incentives, whilst stretching, are not set at levels which the 

committee considers requires excessive risk taking. 

The executive directors’ remuneration is reviewed annually 

by the committee in March with changes effective from 

1 April. In conducting the review the committee has 

regard to the individual’s responsibility and performance; 

current remuneration trends; remuneration information 

for executive directors of a comparable status employed 

by comparable companies; and the reward structures and 

increases in pay for group staff as a whole. The committee 

also monitors and approves changes to the remuneration of 

the group’s executive board. 

Following the March 2012 review, the committee determined 

that with effect from 1 April 2012, Ivor Catto’s base salary 

be increased to £350,200 p.a. (2011: £340,000) and Russell 

Down’s to £216,000 p.a. (2011: £201,000). The percentage 

increase in Ivor Catto’s salary was lower than the average 

percentage increase across the group. The increase in 

Russell Down’s salary (7.46%) recognised his continued 

development and strong performance in the role and brings 

his salary closer in line with the market. 

Short term incentives – annual performance 

bonus 

Bonus entitlement is related to the performance of the 

chief executive or the group finance director as appropriate 

and the performance of the group and is determined by 

the committee. The bonus is paid in June in respect of 

performance in the financial period ended on the previous 

31 March. 

The maximum bonus potential of Ivor Catto and Russell 

Down during the year covered by this report was 100% 

and 75% of base salary respectively. Bonus payments are 

not pensionable and are not subject to any guaranteed 

minimum. 

The committee continues to set bonus targets around 

business specific measures. Eighty per cent of the bonus 

opportunity in 2011-12 was based on a pre-agreed adjusted 

profit before tax target (“PBT”), with that measure also 

being subject to cash conversion targets where a significant 

portion of the bonus would be lost if targets were not 

met. This element of the bonus would vest between 90% 

and 110% of the PBT target on a straight line basis, with 

an entry threshold of 30% of the opportunity at 90% of 

the target. The remaining 20% of the bonus opportunity 


Directors’ Report Directors’ Remuneration Report continued 

was dependent upon the achievement of other longer-term 

strategic objectives. The bonus scheme for the current year 

will operate on a similar basis. 

The committee reviewed performance against the bonus 

targets for the year covered by this report and after making 

adjustments in accordance with the scheme to remove the 

effect of translation foreign exchange gains, the committee 

resolved to pay bonuses to Ivor Catto and Russell Down 

based on 71.86% of their respective bonus potential, 

equivalent to 71.86% and 53.90%, respectively of their 

base salaries. The amounts are detailed in the table of 

remuneration on page 69. The PBT component was based 

on a PBT target for the period of £20.3m and an actual PBT 

(adjusted as above) of £20.4m. 

Retirement benefits 

Ivor Catto and Russell Down participate in one of the 

company’s stakeholder pension schemes. The company 

pays 12.5% of base salary by way of contribution to the 

scheme. The scheme is approved by HM Revenue & Customs 

and is not a contracted-out scheme for the purposes of the 

Pension Schemes Act 1993. 

Russell Down is a deferred member of the defined benefit AGPS. 

Other benefits 

Other benefits for executive directors include entitlement 

to a non-contributory private healthcare scheme for the 

executive, his spouse and dependent children, a permanent 

health insurance scheme and life assurance or payments in 

lieu of each. 

Executive directors are entitled to a car and payment of its 

operating expenses (or an equivalent car allowance). 

Share option scheme and long term 

incentive plan 

Hyder Consulting PLC 2006 Long Term Incentive 

Plan (“LTIP”) 

The LTIP is divided into two parts: Part A and Part B. 

Executive directors can participate only in Part B. 

Awards under the LTIP are discretionary and the committee’s 

current policy is to use the LTIP for incentivising and 

retaining senior members of staff. Awards are considered 

annually and under Part A are subject to a maximum annual 

award of 100% of the base salary and allowances and under 

Part B are subject to a maximum annual award of 100% 

of base salary, other than in the first year of appointment 

where the maximum is 200%. 

During the year covered by this report, the committee 

approved awards under Part A of the LTIP to 29 senior 

members of staff. The awards were made on the basis 

of the staff member’s performance and contribution to 

the business and comprised a deferred award (40%) and 

performance based award (60%) of shares by way of nilcost 

options. The deferred share award will be capable 

of exercise in the event the individual is employed by 

the group on the third anniversary of the award. The 

performance share award will be capable of exercise on the 

third anniversary of the date of grant if the individual is 

still employed by the group and the performance condition 

has been satisfied. The performance condition is based 

on growth in EPS over the three year performance period 

and provides for the award to vest in accordance with a 

sliding scale based around the earnings per share target. 

No consideration is payable on the grant or exercise of the 

options. The committee considers that this is an appropriate 

basis for awards to senior staff members who are not 

members of the board. Russell Down is the only executive 

director holding current awards under part A of the LTIP 

(see page 70). These were granted during his employment 

with the group prior to joining the board. 

The total number of shares which were the subject of awards 

under Part A of the LTIP during the year was 167,844, 

bringing the total number of shares the subject of current 

awards under Part A of the LTIP at 31 March 2012 to 

559,314. 

During the year the committee approved awards under Part 

B of the LTIP to the executive directors as detailed on page 

71 in the form of nil-cost options. The options are capable 

of exercise three years after the date of grant provided 

the performance conditions have been satisfied and the 

participant is still employed by the group. The performance 

period is 1 April 2011 to 31 March 2014. No consideration is 

payable on the grant or exercise of the options. 

Prior to any award the committee reviews performance 

targets to ensure they remain appropriate and are 

demanding and stretching in the context of the prospects 

of the company and the prevailing economic environment. 

Following this review the committee determined that the 

performance conditions used for the awards in the year 

ended 31 March 2011 remained appropriate for the awards 

made to the executive directors during the year ended 31 

March 2012, which were structured as follows: 

Vesting of the first half of the award is subject to 

achievement of a performance target based on the 

compound annual growth in the company’s EPS compared to 

growth in the RPI over the three-year performance period. 


The EPS target is set out in the table below: 

Compound annual 

EPS growth over the 

performance period 

Vesting % of 50% of the 

shares the subject of the 

award 

RPI+12.5% p.a. 100% 

RPI+2.5% to RPI+12.5% 25% to 100% (pro-rated) 

RPI+2.5% p.a. 25% 

Less than RPI+2.5% p.a. 0% 

EPS will be measured based on the diluted earnings 

per ordinary share reported in the company’s financial 

statements adjusted to remove the effect of any significant 

non-recurring items and amortisation of acquired 

intangibles and acquisition costs. 

Vesting of the second half of the award is subject to 

achievement of a performance target based on total 

shareholder return (“TSR”) on the company’s shares over 

a three-year performance period relative to the TSR 

performance of companies within the Business Support 

Services sub sector within the FTSE Small Cap Support 

Services Index (the “Index”) as at the beginning of that 

performance period. 

The TSR target is set out in the table below: 

TSR performance when 

measured against the 

companies comprised 

in the Index over the 

performance period 

Vesting % of 50% of the 

shares the subject of the 

award 

Upper 20% 100% 

Median to upper 20% 25% to 100% (pro-rated) 

Median 25% 

Below median 0% 

TSR is measured based on the changes in share value over 

the performance period and the value of any dividends 

received during that period (on the basis that dividends are 

re-invested in shares of the relevant company on the exdividend 

date). A three-month averaging period is applied at 

the beginning and end of the performance period. 

The committee considers that performance targets based on 

a combination of EPS and TSR remain the most appropriate 

measures for awards made to executive directors under the 

LTIP as they provide a clear line of sight for the executive 

directors and a direct alignment with shareholders’ 

interests. EPS rewards any significant increase in earnings 

across the period and TSR rewards good relative stock 

market performance. These measures will be retained for 

LTIP awards this year although, as indicated earlier, the 

committee will consider the EPS targets prior to any award 

to ensure they remain appropriate. 

In accordance with the rules of the LTIP and terms of the 

awards, in the event of exercise the options are satisfied 

by way of a transfer of existing shares. The company has 

funded the Hyder Consulting PLC Employee Benefit Trust 

(“EBT”) which has acquired company shares for this purpose. 

As at 13 June 2012 the EBT held 801,976 ordinary shares in 

the capital of the company through its trustee: EES Trustees 

International Limited. 

Hyder Consulting PLC Executive Share 

Option Scheme 2002 (the “ESOS”) 

The ESOS was approved by the company on 21 October 2002. 

Part A of the ESOS is HM Revenue & Customs approved 

and restricts the granting of options up to £30,000 per 

person. Part B of the ESOS is unapproved. The grant of 

all share options under the ESOS is at the discretion of 

the committee. The exercise of options is subject to the 

satisfaction of performance conditions, as determined from 

time to time by the committee and imposed at the time of 

grant, which to date have been based on EPS growth above 

the RPI over a three year period. 

During the year covered by this report no new options over 

shares were granted under the ESOS as the LTIP is currently 

the principal vehicle through which share based incentives 

are awarded. The total number of options granted over 

shares under the ESOS is 1,733,750 with options outstanding 

at 31 March 2012 of 390,500 (representing 1.00% of the 

enlarged issued share capital). Russell Down is the only 

director holding current awards under the ESOS (see page 

70). These were granted during his employment with the 

group prior to his joining the board. There are currently no 

plans to grant executive directors further options under the 

ESOS. 

The company’s policy on executive shareholding requires all 

executive directors and certain other senior executives to 

retain a percentage of any shares acquired by reason of their 

exercising any company share options until a shareholding 

of a prescribed value is reached. For the executive directors 

the targeted value of holding equates to their annual base 

salary. Once reached the shareholding is then required to 

be maintained. No options have been exercised by the 

executive directors since the introduction of the policy. The 

number of shares held by each executive director is shown 

on page 69. 

Directors’ service contracts and letters of 

appointment 

The company’s general policy on service agreements is 

that notice periods should not exceed 12 months and that 

compensation payable on termination should not exceed 12 

months’ remuneration. 



Executive directors 

Each of the executive directors who served during the year 

had a rolling 12 month contract, with a 12 month notice 

period due from either employer or director. 

The service contracts for Ivor Catto (dated 24 June 2009) 

and Russell Down (dated 2 December 2008) allow the 

company to make a payment of 12 months’ base salary 

in lieu of the 12 month notice period and do not contain 

provisions entitling the executive director to terminate his 

contract or receive damages in the event of a change of 

control of the company. 

Chairman and non-executive directors 

The company’s general policy on chairman and nonexecutive 

director appointments is that notice periods 

should not exceed three months. Sir Alan Thomas’ contract 

(dated 27 September 2002) is terminable in writing by either 

party giving 12 months’ notice. Paul Withers’ and Jeffrey 

Hume’s appointments are terminable on one months’ notice. 

Subject to early termination or renewal they currently expire 

at the 2013 AGM and on 30 April 2013 respectively. 

The board determines the remuneration of the chairman 

(on the recommendation of the remuneration committee) 

and the other non-executive directors having regard to 

the level of fees paid by other comparable FTSE companies 

and the limits set out in the articles of association. The 

relevant director is not present during the discussion of his 

remuneration package. The chairman and the other nonexecutive 

directors are not entitled to pensions, annual 

bonuses or any similar payments other than expenses 

properly incurred in connection with the performance of 

their duties. Fees were not reviewed during the year under 

review. Following a subsequent review the Chairman’s and 

the non-executive directors’ fees have been increased from 

£80,000p.a. to £90,000p.a. and £33,000p.a. to £37,000p.a. 

respectively. The increases are effective from 1 June 2012. 

These fees have not been increased since 1 October 2009 

and will be the subject of annual review each March in 

future years. 

Performance graph 

The performance graph below shows the company’s total 

shareholder return compared to the FTSE All-Share Index. 

The FTSE All-Share Index has been selected as a comparison 

as it represents a more stable comparative figure than other 

potential indices. Total shareholder return is the return 

that shareholders would receive if they acquired a notional 

number of shares and reinvested dividends on those shares 

over a period of time. 

£140 

£120 

£100 

£80 

£60 

£40 

£20 

£0 

Mar 07 

Return on £100 worth of shares in Hyder Consulting PLC against FTSE 

All Share Index 

Mar 08 

Mar 09 

The total shareholder return provided by the company for 

the five-year period to 31 March 2012 of 96% compares to 

the total shareholder return provided by the FTSE All-Share 

Index of 108.88%. 

Mar 10 

FTSE All-Share 


Mar 11 

Mar 12 


Auditable information 

The following information has been audited by the group’s external auditors, PricewaterhouseCoopers LLP. 

Directors’ shareholdings 

The beneficial interests of the directors (including their connected persons) in the share capital of the company at the 

beginning and end of the financial year are set out below: 

31 March 2012 31 March 2011 

Sir Alan Thomas 876,780 876,780 

Ivor Catto 76,795 76,795 

Russell Down 23,389 23,389 

Paul Withers 50,000 50,000 

Jeffrey Hume 10,000 10,000 

There have been no changes in the directors’ beneficial interests during the period from the end of the financial year on 31 

March 2012 to 13 June 2012. 

Directors’ emoluments and compensation 

Basic 

salary 

paid or 

receivable 

£’000 

Fees 

£’000 

Bonus 

£’000 

Benefits 

in kind 

£’000 

Total 


£’000 

Total 

2011 

£’000 

Pension contributions 

Executive directors 

Ivor Catto 340 - 244 16 600 498 42 39 

Russell Down 201 - 108 12 321 288 25 25 

Chairman 

Sir Alan Thomas - 80 - 2 82 82 - - 

Non-Executive directors 

Paul Withers - 33 - - 33 33 - - 

Jeffrey Hume - 33 - - 33 33 - - 

541 146 352 30 1,069 934 67 64 


£’000 

2011 

£’000 

Notes: 

Russell Down participated during the year in a salary sacrifice arrangement in respect of voluntary contributions he made to the company’s 

stakeholder scheme. Under the arrangement his voluntary contribution is met by the company in return for an equal reduction in his 

contractual pay. This affords the company and the individual savings on National Insurance contributions. 

Russell Down’s salary is shown before the salary sacrifice. Pension contributions shown are those made by the company outside of the 

salary sacrifice arrangement. 

Benefits in kind are calculated in terms of UK taxable values. For executive directors they comprise: a non-contributory private healthcare 

scheme, a permanent health insurance scheme, life assurance and a company car or car allowance. 



Directors’ share options 

The following options were held by directors as at 13 June 2012: 

Director 

Scheme 

Award 

Date 

Market 

price at 

Award 

Date 

(p) 

Exercise 

Price 

Number 

of 

Shares 

at 1 

April 

2011 

Granted 

in the 

year 

Lapsed 

in the 

year* 

Number 

of Shares 

Exercised 

Number 

of Shares 

at 31 

March 


Earliest 

Vesting 

date 

Share 

Price at 

vesting 

date 

(p) 

Period 

Exercisable 

End 

Executive 

Ivor Catto 

LTIP (B) 

LTIP (B) 

LTIP (B) 

LTIP (B) 

11/12/08 

19/06/09 

16/06/10 

15/06/11 

155.84 

152.75 

295.00 

403.60 

Nil 

Nil 

Nil 

Nil 

388,106 

46,546 

105,084 

- 

- 

- 

- 

84,235 

118,354 

- 

- 

- 

- 

- 

- 

- 

269,752 

46,546 

105,084 

84,235 

11/12/11 

19/06/12 

16/06/13 

15/06/14 

370.00 

- 

- 

- 

10/12/18 

18/06/19 

15/06/20 

14/06/21 

Total 539,736 84,253 118,354 - 505,617 

Russell 

Down 

LTIP (A) 

LTIP (A) 

LTIP (B) 

LTIP (B) 

LTIP (B) 

LTIP (B) 

15/06/07 

18/07/08 

11/12/08 

19/06/09 

16/06/10 

15/06/11 

525.00 

348.50 

155.84 

152.75 

295.00 

403.60 

Nil 

Nil 

Nil 

Nil 

Nil 

Nil 

2,666 

7,000 

106,416 

25,525 

66,101 

- 

- 

- 

- 

- 

- 

49,798 

- 

711 

32,453 

- 

- 

- 

- 

- 

- 

- 

- 

- 

2,666 

6,289 

73,963 

25,525 

66,101 

49,798 

15/06/10 

18/07/11 

11/12/11 

19/06/12 

16/06/13 

15/06/14 

295.00 

415.00 

370.00 

- 

- 

- 

14/06/17 

17/07/18 

10/12/18 

18/06/19 

15/06/20 

14/06/21 

ESOS 

ESOS 

ESOS 

03/08/04 

10/06/05 

30/06/06 

139.50 

194.00 

256.25 

139.50 

194.00 

256.25 

5,000 

10,000 

10,000 

- 

- 

- 

- 

- 

- 

- 

- 

- 

5,000 

10,000 

10,000 

03/08/07 

10/06/08 

30/06/09 

510.00 

375.00 

155.00 

02/08/14 

09/06/15 

18/06/19 

Total 232,708 49,798 33,164 - 249,342 

* The proportion of the performance element of the 2008 LTIP share options lapsed on 18th July 2011. 

Notes 

Share price 

The share price at the close of the market on 31 March 2012 was 414p. 

The high for the year was 447.5p and the low was 305p. 

Executive share option scheme (“ESOS”) 

Options granted under the ESOS are ordinarily exercisable between the 

third and tenth anniversary of grant. The maximum duration of the option 

is 10 years. 

Performance criteria for 2004, 2005 and 2006 grants: 

The option is exercisable if during the three year performance period, 

commencing 1 April in the year of award, there has been an increase 

in EPS that in aggregate equates to a compound annual growth rate of 

at least RPI+10% for each year of the relevant performance period. The 

performance conditions have all been satisfied. 

Long Term Incentive Plan – Part A (“LTIP (A)”) 

Performance criteria for 2007 grant: 

Fifty per cent of the award is exercisable if the employee remains in group 

employment on the third anniversary of the award date i.e. 15 June 2010. 

This element is now exercisable. The remaining 50% is exercisable if 

the average annual adjusted EPS for the three-year performance period, 

commencing 1 April 2007, calculated as a percentage of the target EPS of 

41.53p is as follows: 

Percentage of target EPS Vesting % of 50% of the award 

achieved 

90% or less 0% 

91% to 110% 0% to 100% on a straight line basis 

110% and above 100% 

The minimum threshold EPS target was not achieved and that element 

lapsed on 15 June 2010. 


Fifty per cent of the award is exercisable if the employee remains in 

group employment on the third anniversary of the award date i.e.18 July 

2011. This element is now exercisable. The remaining 50% is subject to 

achievement of a performance target based on the compound annual 

growth in EPS compared to growth in RPI over the three-year performance 

period, commencing 1 April 2008. The EPS target is set out in the table 

below: 

Compound annual EPS growth 

over the performance period 

Vesting % of 50% of the award 

RPI+12.5% p.a. 100% 

RPI+5% to RPI+12.5% p.a. 25% to 100% (pro-rated) 

RPI+5% p.a. 25% 

Less than RPI+5% p.a. 0% 

Compound annual EPS growth in excess of RPI across the performance 

period (adjusted to take account of changes in accounting policies during 

the performance period) was 10.5%, which resulted in 79.68% of that 

element being capable of exercise. 


Notes continued 

Long Term Incentive Plan – Part B (“LTIP (B)”) 


Fifty per cent of the award is exercisable based on the compounded annual 

growth in the company’s EPS for the three-year performance period, as 

compared to growth in RPI as follows: 

Compounded annual EPS growth 

over the performance period 

Vesting % of 50% of the award 

RPI+15% p.a. 100% 

RPI+5% p.a. to RPI+15% p.a. 25% to 100% (pro-rated) 

RPI+5% p.a. 25% 

Less than RPI+5% p.a. 0% 

Fifty per cent of the award is exercisable based on a TSR performance 

condition. The terms of the performance condition are summarised on 

page 67 of this report. 

Compound annual EPS growth in excess of RPI across the performance 

period (adjusted to take account of changes in accounting policies during 

the performance period) was 10.5%, which resulted in 66.01% of that 

element being capable of exercise. The company was positioned fifth out 

of fourteen companies for the purposes of the TSR condition resulting in 

73% of that element of the award being capable of exercise. 

Performance criteria for 2009, 2010 and 2011 grants: 

The performance criteria for the awards made under Part B of the LTIP 

in 2009 and 2010 are the same as those for the awards made in 2011 as 

detailed at page 67 of this report. 

Director’s pension benefits 

Russell Down remained a deferred member of the Acer Group Pension Scheme (“AGPS”), which is a defined benefit scheme, 

throughout the year. The following sets out the change in his accrued pension entitlements and benefits in the AGPS, 

together with the cash equivalent transfer value (“transfer value”), calculated in a manner consistent with “Retirement 

Benefit Scheme Transfer Values (GN11)” published by the Institute of Actuaries and the Faculty of Actuaries. 

Accrued pension 

31 March 2012 

£’000 

Transfer value 

31 March 2012 

£’000 

Increase in 

accrued pension 

£’000 

Increase in 

transfer value 

less director’s 

contribution 

£’000 

Accrued pension 

31 March 2011 

£’000 

Transfer value 31 

March 2011 

£’000 

Executive 

Russell Down 20 174 1 52 19 122 

Notes: 

Russell Down became a deferred member of the AGPS on appointment to the board on 11th December 2008. 

Approved on behalf of the board 

Paul Withers 

Chairman of the Remuneration Committee 



Independent auditors’ report to The Members 

of Hyder Consulting PLC 

We have audited the group Financial Statements of Hyder Consulting 

PLC for the year ended 31 March 2012 which comprise the consolidated 

income statement, the consolidated statement of comprehensive 

income, the consolidated balance sheet, the consolidated cash flow 

statement, the consolidated statement of changes in equity, the 

accounting policies and the related notes. The financial reporting 

framework that has been applied in their preparation is applicable law 

and International Financial Reporting Standards (IFRSs) as adopted by 

the European Union. 

Respective responsibilities of directors and auditors 

As explained more fully in the Directors’ Responsibilities Statement 

set out on pages 62 and 63, the directors are responsible for the 

preparation of the group Financial Statements and for being satisfied 

that they give a true and fair view. Our responsibility is to audit and 

express an opinion on the group Financial Statements in accordance 

with applicable law and International Standards on Auditing (UK and 

Ireland). Those standards require us to comply with the Auditing 

Practices Board’s Ethical Standards for Auditors. 

This report, including the opinions, has been prepared for and only for 

the company’s members as a body in accordance with Chapter 3 of Part 

16 of the Companies Act 2006 and for no other purpose. We do not, 

in giving these opinions, accept or assume responsibility for any other 

purpose or to any other person to whom this report is shown or into 

whose hands it may come save where expressly agreed by our prior 

consent in writing. 

Scope of the audit of the Financial Statements 

An audit involves obtaining evidence about the amounts and 

disclosures in the Financial Statements sufficient to give reasonable 

assurance that the Financial Statements are free from material 

misstatement, whether caused by fraud or error. This includes an 

assessment of: whether the accounting policies are appropriate to 

the group’s circumstances and have been consistently applied and 

adequately disclosed; the reasonableness of significant accounting 

estimates made by the directors; and the overall presentation of 

the Financial Statements. In addition, we read all the financial and 

non-financial information in the Annual Report to identify material 

inconsistencies with the audited Financial Statements. If we become 

aware of any apparent material misstatements or inconsistencies we 

consider the implications for our report. 

Opinion on Financial Statements 

Opinion on other matters prescribed by the Companies Act 2006 

In our opinion: 

• the information given in the Directors’ Report for the financial 

year for which the group Financial Statements are prepared is 

consistent with the group Financial Statements. 

Matters on which we are required to report by exception 

We have nothing to report in respect of the following: 

Under the Companies Act 2006 we are required to report to you if, in 

our opinion: 

• certain disclosures of directors’ remuneration specified by law are 

not made; or 

• we have not received all the information and explanations we 

require for our audit. 

Under the Listing Rules we are required to review: 

• the directors’ statement, set out on page 63, in relation to going 

concern; 

• the part of the Corporate Governance Statement relating to 

the company’s compliance with the nine provisions of the UK 

Corporate Governance Code specified for our review; and 

• certain elements of the report to shareholders by the board on 

directors’ remuneration. 

Other matters 

We have reported separately on the parent company Financial 

Statements of Hyder Consulting PLC for the year ended 31 March 2012 

and on the information in the Directors’ Remuneration Report that is 

described as having been audited. 

Bowker Andrews (Senior Statutory Auditor) 

for and on behalf of PricewaterhouseCoopers LLP 

Chartered Accountants and Statutory Auditors 

London 


In our opinion the group Financial Statements: 

• give a true and fair view of the state of the group’s affairs as at 

31 March 2012 and of its profit and cash flows for the year then 

ended; 

• have been properly prepared in accordance with IFRSs as adopted 

by the European Union; and 

• have been prepared in accordance with the requirements of the 

Companies Act 2006 and Article 4 of the IAS Regulation. 


Consolidated 

Financial 

Statements 

& Notes 


Consolidated Income Statement for the year ended 31 March 2012 


Note £’000 £’000 

Revenue 2(a) 277,309 290,297 

Net operating costs 3 (260,239) (272,141) 

Operating profit 2(b) 17,070 18,156 

Finance costs 4 (847) (910) 

Finance income 4 1,423 933 

Profit before tax 17,646 18,179 

Analysed as: 

Adjusted profit before tax 21,607 20,326 

Amortisation of acquired intangibles and acquisition costs (2,462) (2,147) 

Exceptional items (1,499) - 


Taxation 5 (3,723) (3,297) 

Profit for the year 13,923 14,882 

Profit/(loss) attributable to: 

Equity holders of the parent 13,933 14,882 

Non-controlling interests (10) - 

13,923 14,882 

Earnings per share (p) 

Basic 6(c) 36.48 39.29 

Diluted 6(c) 35.96 38.63 

The adjusted earnings per share figures are shown in note 6(d). 

Consolidated Statement of Comprehensive Income for the Year Ended 31 March 2012 


£’000 £’000 

Profit for the year 13,923 14,882 

Other comprehensive (expense)/income for the year 

Foreign exchange movements (1,342) (1,795) 

Cash flow hedges (48) 133 

Actuarial (loss)/gain on defined benefit pension schemes (4,507) 2,705 

Total other comprehensive (expense)/income for the year (5,897) 1,043 

Total comprehensive income for the year 8,026 15,925 

Attributable to: 

Equity holders of the parent 8,034 15,925 

Non-controlling interests (8) - 

All balances are shown net of tax. 8,026 15,925 

The effect of tax on the balances shown is disclosed in note 5. 


Consolidated Balance Sheet as at 31 March 2012 


Note £’000 £’000 

Assets 

Non-current assets 

Goodwill 8 36,082 30,485 

Intangible assets 9 7,045 8,585 

Property, plant and equipment 10 7,106 7,550 

Deferred tax assets 17 10,373 10,079 

60,606 56,699 

Current assets 

Trade and other receivables 11 118,165 111,747 

Corporation tax recoverable 179 602 

Cash and cash equivalents 12 23,218 22,220 

141,562 134,569 

Liabilities 

Current liabilities 

Borrowings 13 (1,018) (1,469) 

Trade and other payables 14 (67,660) (64,816) 

Current tax liabilities (3,372) (4,469) 

Provisions 16 (3,958) (4,201) 

(76,008) (74,955) 

Net current assets 65,554 59,614 

Non-current liabilities 

Borrowings 13 (6,557) (7,655) 

Post employment benefits 26 (24,235) (23,954) 

Provisions 16 (1,254) (619) 

Deferred tax liabilities 17 (950) (731) 

Other non-current liabilities 18 (5,892) (1,988) 

(38,888) (34,947) 

Net assets 87,272 81,366 

Equity 

Called up ordinary share capital 19 3,863 3,854 

Share premium 21 29,789 29,589 

Retained earnings 43,646 36,606 

Other reserves 22 9,583 11,317 

Equity attributable to equity holders of the parent 86,881 81,366 

Non-controlling interests 391 - 

Total equity 87,272 81,366 

The Financial Statements on pages 74 to 116 were approved by the board of directors and were signed on its behalf by: 

Ivor Catto 



Russell Down 




Consolidated cash flow statement for the year ended 31 March 2012 


Note £’000 £’000 

Cash flows from operating activities 

Cash generated from operations 23(a) 15,630 19,164 

Net finance costs (527) (319) 

Tax paid (4,501) (4,522) 

Net cash generated from operating activities 10,602 14,323 

Cash flows from investing activities 

Acquisition of subsidiaries (net of cash acquired) (2,536) (440) 

Proceeds from disposal of property, plant and equipment (incl. software) 107 229 

Purchase of property, plant and equipment (incl. software) (2,268) (2,382) 

Net cash used in investing activities (4,697) (2,593) 

Cash flows from financing activities 

Proceeds on issue of shares 209 325 

Shares issued to non-controlling interests 50 - 

Employee trust purchase of own shares (361) (559) 

Repayments of obligations under finance leases (837) (995) 

Net movement on borrowings (891) (7,680) 

Dividends paid 7 (3,027) (2,358) 

Net cash used in financing activities (4,857) (11,267) 

Net increase in cash and cash equivalents 1,048 463 

Cash and cash equivalents at 1 April 22,220 21,399 

Effects of exchange rate fluctuations (50) 358 

Cash and cash equivalents at 31 March 23,218 22,220 

Reconciliation of net cash 


Note £’000 £’000 

Net increase in cash and cash equivalents 1,048 463 

Decrease in debt 1,555 8,675 

Effect of exchange rate changes (56) 325 

Change in net cash during the year 2,547 9,463 

Net cash at 1 April 13,096 3,633 

Net cash at 31 March 23(b) 15,643 13,096 


Consolidated statement of changes in equity for the year ended 31 March 2012 

Non- 

Share Share Retained Other controlling Total 

capital premium earnings reserves Total interests equity 

Note £’000 £’000 £’000 £’000 £’000 £’000 £’000 

At 1 April 2010 3,837 29,281 21,059 13,442 67,619 - 67,619 

Profit for the year - - 14,882 - 14,882 - 14,882 

Foreign exchange movements 22 - - - (1,795) (1,795) - (1,795) 

Cash flow hedges 22 - - - 133 133 - 133 

Actuarial gain on post employment benefit schemes - - 2,705 - 2,705 - 2,705 

New shares issued 19 17 - - - 17 - 17 

Premium on new shares issued 21 - 308 - - 308 - 308 

Dividends paid 7 - - (2,358) - (2,358) - (2,358) 

Share based payments 25 - - 414 - 414 - 414 

Employee trust purchase of own shares 22 - - - (559) (559) - (559) 

Transfer of own shares from EBT 22 - - (96) 96 - - - 

Non-controlling interests acquired - - - - - - - 

At 31 March 2011 3,854 29,589 36,606 11,317 81,366 - 81,366 

Profit for the year - - 13,933 - 13,933 (10) 13,923 

Foreign exchange movements 22 - - - (1,344) (1,344) 2 (1,342) 

Cash flow hedges 22 - - - (48) (48) - (48) 

Actuarial loss on post employment benefit schemes - - (4,507) - (4,507) - (4,507) 

New shares issued 19 9 - - - 9 - 9 

Premium on new shares issued 21 - 200 - - 200 - 200 

Dividends paid 7 - - (3,027) - (3,027) - (3,027) 

Share based payments 25 - - 660 - 660 - 660 

Employee trust purchase of own shares 22 - - - (361) (361) - (361) 

Transfer of own shares from EBT 22 - - (19) 19 - - - 

Non-controlling interests acquired - - - - - 399 399 

At 31 March 2012 3,863 29,789 43,646 9,583 86,881 391 87,272 

All balances are shown net of tax. The effect of tax on the balances shown is disclosed in note 5. 


1. Principal Accounting Policies 

The group’s Financial Statements have been prepared in accordance 

with International Financial Reporting Standards (IFRS) and IFRIC 

interpretations endorsed by the European Union (EU) and with those 

parts of the Companies Act 2006 applicable to companies reporting 

under IFRS. 

The consolidated Financial Statements are prepared on a going 

concern basis under the historical cost convention, as modified by 

the valuation of intangible assets acquired in business combinations, 

financial instruments and pension assets and liabilities which are 

measured at fair value. 

The principal accounting policies set out below have been used in 

preparation of the Financial Statements. These policies have been 

consistently applied to the presented information unless stated 

otherwise. 

Basis of preparation 

The Financial Statements have been prepared in accordance with 

IFRS that are applicable as at 31 March 2012. IFRS are subject to 

amendment or interpretation by the International Accounting 

Standards Board and there is an ongoing process of review and 

endorsement by the EU. 

The preparation of the Financial Statements in conformity with 

IFRS requires the use of estimates and assumptions that affect the 

reported amounts of assets and liabilities at the date of the Financial 

Statements and the reported amounts of revenues and expenses 

during the reported year. Although these estimates are based on 

management’s best knowledge of the amount, event or actions, actual 

results ultimately may differ from those estimates. 

At the date of approval of these Financial Statements, the following 

Standards and Interpretations which have not been applied were in 

issue but not yet effective: 

IAS 12 

(amended 2010) 

IAS 19 

(revised 2011) 

IAS 27 


IAS 28 


IFRS 9 

IFRS 10 

IFRS 11 

IFRS 12 

IFRS 13 

Improvements to IFRSs (2011) 

– Deferred Tax: Recovery of Underlying Assets 

– Employee Benefits 

– Separate Financial Statements 

– Investments in Associates and Joint Ventures 

– Financial Instruments 

– Consolidated Financial Statements 

– Joint Arrangements 

– Disclosure of Interest in Other Entities 

– Fair Value Measurement 

The directors anticipate that the adoption of these Standard and 

Interpretations in future periods will have no material impact on the 

Financial Statements of the group, except for: 

• IAS 19 was amended in June 2011. The impact on the group will be 

to replace interest cost and expected return on plan assets with a 

net interest amount that is calculated by applying the discount 

rate to the net defined benefit liability. This standard is effective 

for accounting periods commencing on or after 1 January 2013 and 

so will be applied in the year ending 31 March 2014, with the prior 

year being restated. The impact of this change on the net finance 

costs for the year ending 31 March 2013 is expected to be an 

additional interest cost of £1.7m. 

• IFRS 9 addresses the classification, measurement and recognition 

of financial assets and financial liabilities. This standard is 

effective for accounting periodscommencing on or after 1 January 

2015 and therefore the group has not commenced its evaluation of 

the impact on the Financial Statements. 

• IFRS 11 is a new standard, replacing the existing rules set out in 

IAS 31, ‘Interest in Joint Ventures’. Under IFRS 11 joint control is 

defined as the contractually agreed sharing of control of an 

arrangement which exists only when the decisions about the 

relevant activities require the unanimous consent of the parties 

that share control. IFRS 11 defines two forms of joint 

arrangements (joint operations and joint ventures). The group 

expects its arrangements under joint control to be classed as joint 

operations and we will therefore continue to consolidate our share 

of these arrangements. This standard is effective for accounting 

periods commencing on or after 1 January 2013. 

Basis of consolidation 

The group Financial Statements comprise a consolidation of the 

Financial Statements of Hyder Consulting PLC (the company) and all 

its subsidiary undertakings (together ‘the group’), and include the 

group’s share of profits or losses and net assets of associated 

undertakings and the group’s share of its joint ventures. The Financial 

Statements of each company in the group are prepared to 31 

March 2012. Intra-group transactions and balances have been 

eliminated on consolidation. 

A subsidiary is an entity controlled, either directly or indirectly, by 

the company, where control is the power to govern the financial and 

operating policies of the entity so as to obtain benefit from its 

activities. Where necessary, adjustments are made to the Financial 

Statements of subsidiaries to bring the accounting policies used 

into line with those used by the company and the group. Noncontrolling 

interests represent the portion of comprehensive income 

and equity in subsidiaries that is not attributable to the parent 

company shareholders and is presented separately from parent 

shareholders’ equity in the consolidated balance sheet. 

In accordance with IAS 31 the group accounts for joint ventures under 

the proportionate consolidation method. The group’s share of joint 

ventures’ assets, liabilities and results are included from the date on 

which the group acquires an interest in the joint venture. 


1. Principal Accounting Policies continued 

The results, assets and liabilities of joint ventures are stated in 

accordance with group accounting policies. Where joint ventures 

adopt different accounting policies to the group, their reported results 

are restated so as to comply with the group’s accounting policies. 

Where joint ventures have a different accounting date to that of 

the group, results and net assets are based upon management 

accounts for the relevant period. 

Segmental reporting 

Property, plant and equipment 

Property, plant and equipment is carried at historical cost less 

accumulated depreciation. 

Depreciation is calculated so as to write off the cost of the property, 

plant and equipment, less the estimated residual value including 

estimated selling costs, over the estimated useful life on a straight 

line basis as follows: 

Operating segments are reported in a manner consistent with the 

internal reporting provided to the board (the chief operating decision 

maker) which is responsible for allocating resources and assessing 

performance of the operating segments. 

Freehold buildings 

Property, plant and equipment 

Leased assets 

– 40 years 

– 2 to 5 years 

Reflecting the group’s management and internal reporting structure, 

segmental information is presented within the Financial Statements 

in respect of geographical segments. The group manages its business 

internationally with operations in three main geographical regions, 

Asia-Pacific, the Middle East, and Europe. The UK is the home country 

of the parent. Inter-segment revenue relates to contracts priced on an 

arm’s length basis. 

The group’s revenue is derived from the provision of engineering 

consultancy services. 

Revenue recognition 

Revenue is stated net of sales tax and is recognised only when the 

outcome of the transaction can be measured reliably and it is probable 

that the economic benefits will flow to the group. Any loss on a 

contract is recognised as soon as it is foreseen. 

Where fee income is determined by time charged, revenue represents 

the amount of services provided during the period. Revenue on long 

term contracts is recognised according to the stage of completion 

at the period end date and the terms of the contract including those 

in relation to variations. The stage of completion is based upon a 

review of the contract progress and the proportion of costs incurred 

for work performed compared to the estimated total cost of the 

contract after making a prudent allowance for uncertainties. 

Goodwill 

Goodwill carried at cost less any accumulated impairment losses, is 

not amortised and is tested at least annually for impairment, at cash 

generating unit level. If the recoverable amount of goodwill is less 

than the carrying value, an impairment loss is recognised immediately 

in the income statement. Goodwill recognised under UK GAAP prior to 

1 April 2004, the transition date to IFRS, is stated at net book value 

at this date under the exemption permitted by IFRS 1. 

Leasing arrangements which transfer substantially all the risks and 

rewards of ownership of an asset to the group are classified as finance 

leases. All other leases are classified as operating leases. 

Assets held under finance leases are included within property, plant 

and equipment. The asset is initially measured at fair value, or if 

lower, the present value of the minimum lease payments. A 

corresponding liability is recognised within obligations under finance 

leases. The assets are either depreciated using the same method as 

similar property, plant and equipment, or the length of the lease, 

whichever is shorter. 

Leasing payments are treated as consisting of a capital element and 

finance costs, the capital element reducing the obligation to the 

lessor and the finance charges being written off to the income 

statement over the period of the lease in reducing amounts in relation 

to the written down amount. 

Rental costs arising under operating leases are charged to the income 

statement in the period to which they relate. 

Lease incentives received are amortised over the life of the full lease 

term on a straight line basis. 

Intangible assets 

Intangible assets acquired are capitalised at cost and those identified 

in a business combination are capitalised at fair value as at the 

date of acquisition. Following initial recognition, the carrying 

amount of an intangible asset is its cost less any accumulated 

amortisation and any accumulated impairment provisions. Useful lives 

of intangible assets are assessed on acquisition to be either indefinite 

or finite. Amortisation is charged as appropriate on those intangibles 

with finite lives, while those with indefinite lives are tested for 

impairment. Computer software that does not form part of property, 

plant and equipment is recognised separately as an intangible asset. 



Amortisation is provided in line with the expected benefit derived 

from each asset over its expected useful life. The amortisation rates 

applicable are as follows: 

Brand names 

Customer contracts and relationships 

Computer software 

Impairment 

– 5 years 



Goodwill is reviewed annually for impairment. Reviews of other 

intangible assets and property, plant and equipment are conducted 

where there is an indication of impairment on an annual basis to 

determine whether the carrying value of the assets may be 

irrecoverable. If any such indication exists, the recoverable amount 

of the asset is calculated as the greater of value in use or fair value 

less costs to sell, where the value in use is calculated as the present 

value of future cash flows resulting from the asset’s continued use and 

eventual disposal. This value is compared to the carrying value of the 

asset with any resultant loss recorded as a charge in the income 

statement. A summary of the key assumptions used is set out in note 8. 

Dividends 

Final dividends payable are recognised as a liability in the accounting 

period they are approved by the company’s shareholders. Interim 

dividends are recognised in the period that they are paid. 

Trade receivables 

Trade receivables are recognised initially at fair value and at amortised 

cost thereafter, based on amounts invoiced less a provision for 

impairment. 

Trade receivables include amounts recoverable on contracts, which 

are stated at cost plus attributable profit to the extent that such 

profit is reasonably certain and after making provision for any 

foreseeable losses in completing contracts, less payments on account 

received. Cost comprises the direct costs of providing the service, 

together with directly attributable overheads. Payments on account 

represent the excess of amounts billed over that earned and are 

included separately within trade and other payables. 

Cash and cash equivalents 

In the consolidated cash flow statement, cash and cash equivalents 

consist of cash at banks and in hand and short term bank deposits. 

The amounts are carried at cost in the balance sheet. Bank deposits 

have a maturity date of less than three months from the date the 

deposit was made. 

Post employment benefit costs 

Payments to defined contribution pension schemes are charged as an 

expense to the income statement as they fall due. 

For defined benefit pension schemes and similar arrangements, the 

obligation is calculated by independent actuaries using the Projected 

Unit Credit Method. Actuarial gains and losses, which represent 

differences between the expected and actual return on the plan 

assets and the effect of changes in the actuarial assumptions, are 

recognised in full in the period in which they occur in the statement 

of comprehensive income. 

The defined post employment benefit obligation recognised in the 

balance sheet comprises the total for each plan of the present value 

of the benefit obligation using a discount rate determined by market 

yields on high quality corporate bonds, less the fair values of the 

scheme assets at the year end date. 

Current and past service costs, together with settlements and 

curtailments, are charged to operating profit. 

Foreign currency translation 

At each period end date, monetary assets and liabilities that are 

denominated in foreign currencies are retranslated at the rates 

prevailing on that date. 

Transactions denominated in foreign currencies are translated 

into sterling at the exchange rate ruling on the date of the 

transaction. Monetary assets and liabilities denominated in foreign 

currencies are retranslated at the exchange rate ruling on the period 

end date. Currency translation differences are recognised in the 

income statement. 

On consolidation, the balance sheets of the group’s overseas 

operations are translated at exchange rates prevailing at the period 

end date. Any gains or losses arising on translation of opening 

and closing reserves are accounted for in the statement of 

comprehensive income. Income and expense items are translated at 

the average exchange rates for the period. 

Trade payables 

Trade payables are obligations to pay for goods or services that have 

been acquired in the ordinary course of business from suppliers. Trade 

payables are classified as current liabilities if payment is due within 

one year or less. If not, they are presented as non-current liabilities. 

Trade payables are recognised initially at fair value and subsequently 

measured at amortised cost using the effective interest method. 

Borrowings 

All loans and borrowings are initially recognised at cost being the 

net fair value of the consideration received plus transaction costs 

that are directly attributable to the issue of the borrowing. After 

initial recognition, interest bearing loans and borrowings are 

subsequently measured at amortised cost using the effective interest 

method. 



Borrowing costs are recognised as an expense in the period in which 

they are incurred, except to the extent that they are directly 

attributable to the acquisition, construction or production of a 

qualifying asset. Fees paid on the establishment of loan facilities 

have been deferred and amortised where there is no evidence that it is 

probable that some or all of the facility will be drawn down. The 

fees are amortised over the period of the facility to which they 

relate. 

Derivative financial instruments 

The group’s global coverage exposes it to a variety of financial risks, 

such as liquidity, foreign exchange and interest rate risks. A risk 

management programme is in place that seeks to limit the adverse 

effect of these risk factors on the financial performance of the 

group. Where appropriate the group enters into interest rate and 

currency instruments in order to hedge against the effects of future 

interest and exchange rate fluctuations, in line with the group’s 

treasury policy. 

Derivative financial instruments utilised by the group during the year 

included interest rate swaps, forward foreign exchange contracts and 

forward foreign exchange options. 

Hedges are classified as follows: 

Fair value hedges – instruments that mitigate 

exposure to changes in the fair value of 

recognised assets or liabilities 

Cash flow hedges – instruments that mitigate exposure to 

cash flow fluctuations from a 

risk associated to recognised assets or 

liabilities, or for a forecast transaction 

For cash flow hedges, the element of the gain or loss that is 

determined to be an effective hedge is recognised in equity, with any 

ineffective portion recognised in the group’s income statement. 

Any gains or losses arising from fluctuations in the fair value of 

derivative financial instruments not designated as hedges are 

recognised immediately in the group’s income statement. The fair 

value of interest rate and foreign currency hedges are based on the 

market price of comparable financial instruments at the year end date. 

The fair value of short term deposits, loans and bank overdrafts with a 

maturity of less than one year have been assumed to approximate to 

their book value. 

Provisions 

Provisions are recognised in the balance sheet when the group has a 

legal or constructive obligation as a result of a past event and it is 

probable that an outflow of resources will be required to settle this 

obligation and a reliable estimate of this obligation can be made. The 

following material provisions are currently held by the group: 

Vacant properties 

Provisions are made based on the estimated net present value of 

future rental payments less sublease income where properties are 

vacant, using independent professional advice and the region’s 

weighted average cost of capital. 

Professional indemnity claims including excesses 

Excesses are provided for on professional indemnity insurance 

claims at the point these are notifiable to its insurers. Amounts 

provided are based on estimates derived by applying percentage 

probabilities to the expected outcome of the claim. Claims 

deemed to have a low chance of success are not provided for. 

The amounts provided against specific indemnity claims are 

necessarily judgemental and reviewed regularly in light of known 

circumstances. 

Share based payments 

Equity settled share based incentives are provided to employees under 

the Hyder Consulting PLC Executive Share Option Scheme 2002 and 

the Hyder Consulting PLC 2006 Long Term Incentive Plan. Equity 

settled share based payments are measured at fair value at the date of 

grant. The fair value determined at the grant date is expensed on a 

straight line basis over the vesting period, based on the group’s 

estimate of shares that will eventually vest. 

Fair value for options with non-market performance conditions is 

measured by using the Black Scholes option pricing model which the 

directors believe to be the most suitable calculation technique. The 

expected life used in the model is based on management’s best 

estimate taking account of employees’ behaviour. Options with 

market-related performance conditions are measured using the Monte 

Carlo model. 

Taxation 

The income tax expense represents the sum of the tax currently 

payable and deferred tax. 

The tax currently payable is based on the estimated taxable profit for 

the year. Taxable profit differs from net profit as reported in the 

income statement because it excludes items of income or expense that 

are taxable or deductible in other financial years and it further 

excludes items that are never taxable or deductible. The group’s 

liability for current tax is calculated using the tax rates that have 

been enacted in each jurisdiction as at the year end date. 



Deferred tax is recognised in respect of temporary differences that 

have originated but not reversed at the year end date. Deferred tax is 

measured on a non-discounted basis using tax rates (and laws) that 

have been enacted or substantially enacted by the year end date and 

are expected to apply when the related deferred tax asset is realised 

or the deferred tax liability is settled. 

A deferred tax asset is recognised only when it is probable that 

sufficient taxable profits will be available against which the temporary 

differences can be recovered. 

Acquisition costs 

Acquisition related costs are expensed through the consolidated 

income statement and included within ‘amortisation of acquired 

intangibles and acquisition costs’. 


Exceptional items are transactions that are unusual in size or 

nature. The directors consider that such transactions should be 

separately disclosed in order to allow the user of the Financial 

Statements to better understand the underlying performance of the 

group. 

Employee Benefit Trust 

The company’s EBT is a separately administered discretionary trust for 

the benefit of employees. The assets of the EBT comprise shares in 

the company. The assets, liabilities, income and costs of the EBT are 

consolidated in the Financial Statements. The investment in own 

shares is treated as a deduction in shareholders’ funds. 

Key assumptions and estimates 

In producing the Financial Statements, the group has to make 

judgements, assumptions and estimates that directly affect the 

reported amounts of revenues and expenses, assets and liabilities, 

and the disclosure of contingent liabilities. The directors base their 

key assumptions and estimates on historical experience and various 

reasonable assumptions based upon the circumstances. The 

result forms the basis for making judgements regarding the 

carrying value of assets and liabilities that may not be readily 

available from other sources. Under different assumptions 

or circumstances, actual results may be different to these estimates. 

Significant judgements 

The preparation of the Financial Statements requires the group to 

make estimates and judgements in relation to the valuation of 

revenues, costs, assets and liabilities. Actual results may be different 

from those which had been estimated, which could have a consequent 

effect on the reported results. 

The estimates and judgements which management consider may have 

the most significant impact on the Financial Statements are 

described below: 

• Revenue recognition: the group believes that the most 

significant judgement is made in relation to the recognition 

of revenue and the assessment of contract progress which 

determines the proportion of contract work completed. Work 

in progress is valued and carried forward based on the revenue 

recognised less amounts billed. Consequently the calculation 

of the percentage of contract completion affects the valuation 

of revenue and work in progress. The group has established 

procedures to ensure that contracts and forecasts are reviewed 

regularly. 

• Trade receivables: balances due from clients are held on 

the balance sheet at invoiced amounts less a provision for 

impairment. The group exercises judgement in setting receivables 

provisions, particularly in relation to amounts due in the Middle 

East, utilising its substantial market and client knowledge. 

• Goodwill: the group assesses acquired goodwill for impairment 

in accordance with its accounting policies and the assumptions 

detailed in note 8. The value in use calculations performed use 

estimates relating to future predicted cash flows expected from 

the cash generating units (CGUs). The group uses a CGU specific 

weighted average cost of capital as the basis of the discount 

rate for these calculations. In addition, the calculations are 

performed using a discount rate increased by 1% and growth 

rates reduced by 1% to identify the level of headroom available 

in the calculation. 

• Intangible assets: judgement is exercised in relation to 

the valuation of intangible assets from acquired businesses, 

including brand names, order book and customer relationships, 

and their expected useful lives. The group utilises its market 

knowledge and specialist valuation tools in order to identify the 

appropriate valuation for the acquired assets. 

• Post employment benefits: the actuarial valuation of benefits 

is carried out based on a number of assumptions, including those 

related to discount rates, mortality rates and inflation. The 

assumptions are set by the group using the services of qualified 

actuaries and using available market data. The assumptions are 

disclosed in note 26. 

• Deferred tax: the valuation of deferred assets is dependent on 

assumptions related to future profitability. The group reviews 

profit forecasts for the affected businesses in order to ascertain 

the value of the asset to be carried forward. 


2. Segmental analysis by location of operations 

Operating segments are reported in a manner consistent with the internal reporting provided to the board (the chief operating decision maker), 

which is responsible for allocating resources and assessing performance of the operating segments. 

Reflecting the group’s management and internal reporting structure, segmental information is presented within the Financial Statements in respect 

of geographical segments. The group manages its business internationally with operations in three main geographical regions, Asia-Pacific, the 

Middle East, and Europe. The UK is the home country of the parent. Inter-segment revenue relates to contracts priced on an arm’s length basis. 

The group’s revenue is derived from the provision of engineering consultancy services. 

(a) Segment revenue 

Year ended 31 March 2012 Year ended 31 March 2011 

Total Revenue from Total Revenue from 

segment Inter-segment external segment Inter-segment external 

revenue revenue customers revenue revenue customers 

£’000 £’000 £’000 £’000 £’000 £’000 

Australia 91,301 (1,123) 90,178 92,102 (338) 91,764 

Asia 22,336 (277) 22,059 22,721 (466) 22,255 

Asia-Pacific 113,637 (1,400) 112,237 114,823 (804) 114,019 

Middle East 67,362 (3,525) 63,837 66,716 (1,229) 65,487 

UK 75,985 (945) 75,040 87,799 (604) 87,195 

Germany 26,273 (78) 26,195 23,626 (30) 23,596 

Europe 102,258 (1,023) 101,235 111,425 (634) 110,791 

283,257 (5,948) 277,309 292,964 (2,667) 290,297 

(b) Segment results 


£’000 £’000 

Australia 13,821 13,912 

Asia 889 547 

Asia-Pacific 14,710 14,459 

Middle East 3,882 2,605 

UK 3,981 5,460 

Germany 1,545 1,105 

Europe 5,526 6,565 

Corporate overheads (3,087) (3,326) 

Adjusted operating profit 21,031 20,303 

Amortisation of acquired intangibles (1,781) (2,147) 

Acquisition costs (681) - 

(2,462) (2,147) 


UK vacant property costs (1,349) - 

UK AGPS closure costs (150) - 

(1,499) - 

Operating profit 17,070 18,156 


2. Segmental analysis by location of operations continued 

(c) Other profit and loss disclosures 

Year ended 31 March 2012 Year ended 31 March 2011 

Amortisation of 

Amortisaion of 

Amortisation of acquired Amortisation of acquired 

Depreciation software intangibles Depreciation software intangibles 

£’000 £’000 £’000 £’000 £’000 £’000 

Australia 1,298 288 53 1,363 296 190 

Asia 238 170 79 270 176 166 

Asia-Pacific 1,536 458 132 1,633 472 356 

Middle East 435 571 625 797 574 941 

UK 697 437 555 639 474 386 

Germany 383 256 469 404 235 464 

Europe 1,080 693 1,024 1,043 709 850 

3,051 1,722 1,781 3,473 1,755 2,147 

(d) Total assets 

31 March 31 March 


£’000 £’000 

Australia 50,922 40,718 

Asia 19,345 18,249 


Middle East 65,462 55,459 

UK 42,177 46,512 

Germany 24,262 30,330 

Europe 66,439 76,842 

202,168 191,268 


3. Net operating costs 

The following expenses/(income) have been included in arriving at operating profit: 


£’000 £’000 

Employee costs (excluding interest on pension costs) 169,005 178,280 

Sub-consultant costs 35,540 38,924 

Depreciation of property, plant and equipment 

- Owned assets 2,323 2,537 

- Under finance leases 728 936 

Operating lease rentals payable 

- Plant and machinery 4,044 3,640 

- Property 6,220 6,498 

Amortisation of intangible assets 

- Software 1,722 1,755 

- Business combinations 1,781 2,147 

Acquisition costs 681 - 

Loss on disposal of property, plant and equipment 9 680 

Other operating expenses 37,525 37,138 

Other operating income (890) (524) 

Net foreign exchange loss 82 149 

Fair value gain on financial instruments (30) (19) 

Exceptional items 1,499 - 

Net operating costs 260,239 272,141 

Services provided by the group’s auditor and network firms 

During the year the group (including its overseas subsidiaries) obtained the following services 

from the group’s auditor at costs as detailed below: 


£’000 £’000 

Fees payable to the company’s auditor for the audit of the parent company and 

consolidated Financial Statements 102 92 

Fees payable to the company’s auditor and its associates for other services: 

- The audit of company’s subsidiaries pursuant to legislation 328 338 

- Tax services 86 75 

- Due diligence on acquisitions 25 - 

- IT reviews 23 37 

Other services not covered above 20 8 

584 550 


4. Net finance INCOME 


£’000 £’000 

Bank borrowings (474) (463) 

Finance leases (63) (89) 

Interest rate financial instruments (151) (234) 

Amortisation of arrangement fees (18) - 

Unwinding of discounts on provisions and other liabilities (141) (124) 

Finance costs (847) (910) 

Investment income 285 467 

Interest received on settlement of contracts 133 - 

Unwinding of discounts on trade receivables 76 - 

Net finance income on post employment benefit schemes 929 466 

Finance income 1,423 933 

Net finance income 576 23 


5. Taxation 


£’000 £’000 

Current tax 

Current year 4,435 4,842 

Adjustment in respect of prior years (639) (141) 

Total current tax 3,796 4,701 

Deferred tax 

Current year 1,279 (1,611) 

Adjustment in respect of prior years (1,025) 497 

Adjustment to deferred tax attributable to change in rate (327) (290) 

Total deferred tax (73) (1,404) 

Total tax 3,723 3,297 

The tax rate of 21.1% for the year (2011: 18.1%) is lower than the standard rate of corporation tax in the UK of 26% (2011: 28%). The differences 

are explained below: 


£’000 £’000 


Tax at UK effective rate of 26% (2011: 28%) 4,587 5,090 

Adjustments to tax in respect of prior years (1,664) 356 

Effect of different tax rates of subsidiaries operations in other jurisdictions (378) (71) 

Effect of expenses not deductible for tax 1,025 288 

Effect of research and development tax credits (833) (1,811) 

Effect of movement on deferred tax assets not recognised 649 (648) 

Irrecoverable overseas tax 664 383 

Effect on deferred tax balances due to change in UK corporate tax rate to 26% (effective 1 April 2011) (327) (290) 

Total tax 3,723 3,297 

Tax on items charged to other comprehensive (expense)/income 


£’000 £’000 

Deferred tax (credit)/charge in respect of actuarial (loss)/gain on defined benefit pension (263) 2,126 

Factors that may affect future tax charges 

(263) 2,126 

The Finance Act 2011 included legislation to reduce the main rate of corporation tax from 26% to 25% from 1 April 2012. In addition further 

reductions were announced in the March 2012 Budget Statement. A resolution passed by Parliament on 26 March 2012 reduced the main rate of 

corporation tax to 24% from 1 April 2012. The reduction from 26% to 24% has been reflected in these Financial Statements. 

The proposed reductions of the main rate of corporation tax by 1% per annum to 22% by 1 April 2014 are expected to be enacted separately each 

year. The overall effect of the further changes from 24% to 22%, if these applied to the deferred tax balance at the balance sheet date, would be 

to reduce the deferred tax asset by £0.5m (being £0.3m in 2013 and £0.2m in 2014). 


6. Earnings per share 

(a) Number of shares 


Weighted average number of shares in issue 38,195,119 37,876,301 

Effect of dilution 

Share options 551,891 645,467 

Weighted average shares (diluted) 38,747,010 38,521,768 

(b) Earnings used in the calculation of earnings per share 


£’000 £’000 

Profit attributable to equity shareholders 13,933 14,882 

Add back amortisation of acquired intangibles and acquisition costs 2,462 2,147 

Add back exceptional items 1,499 - 

Less tax on adjusted items (712) (333) 

Adjusted earnings 17,182 16,696 

(c) Earnings per share 


p 

p 

Basic earnings per share 36.48 39.29 

Add back amortisation of acquired intangibles and acquisition costs 6.45 5.67 

Add back exceptional items 3.92 - 

Less tax on adjusted items (1.86) (0.88) 

Adjusted basic earnings per share 44.99 44.08 


p 

p 

Diluted earnings per share 35.96 38.63 

Add back amortisation of acquired intangibles and acquisition costs 6.35 5.57 

Add back exceptional items 3.87 - 

Less tax on adjusted items (1.84) (0.86) 

Adjusted diluted earnings per share 44.34 43.34 


7. Dividends 


£’000 £’000 

Dividends charged to equity in the year 3,027 2,358 

Equity - per ordinary 10p share 

Final dividend paid (p) 6.00 4.50 

Interim dividend paid (p) 2.00 1.75 

As at 31 March 2012, the employee benefit trust had an agreement in place to waive dividends on 801,976 ordinary shares (2011: 710,719). This 

arrangement reduced the dividends paid in the year by £59,000 (2011: £45,000). 

The directors are proposing a final dividend of 7.00p per share (2011: 6.00p). In accordance with IFRS the dividend has not been recognised in the 

Financial Statements but if approved by shareholders will be paid on 10 August 2012 to shareholders on the register as at 13 July 2012. 


8. Goodwill 


£’000 £’000 

Cost 

At 1 April 30,485 31,242 

Exchange adjustments (345) (227) 

Amendments to fair value of consideration - (530) 

Additions 5,942 - 

Cost and net book amount at 31 March 36,082 30,485 

The amendments to fair value of consideration reflect adjustments made in the prior year in relation to the estimated values assigned to 

contingent consideration. The carrying value of goodwill by cash generating unit (CGU) is as follows: 


£’000 £’000 

Australia 10,874 6,888 

Asia 4,782 4,757 



UK 6,437 6,101 

Germany 6,049 6,363 

Europe 12,486 12,464 

36,082 30,485 

The group tests goodwill annually for impairment, or more frequently where indicators of impairment become apparent. Based on the assumptions 

detailed below, no impairment to the group’s goodwill was identified. 

As at 31 March 2012, the value of goodwill acquired was tested for impairment using the following key assumptions based on long term market 

trends, market data and management experience and expectations: 

Discount rate 

A pre tax discount rate of between 9.7% and 14.1% (2011: between 10.8% and 15.2%) was applied, which was calculated using the group’s pre 

tax Weighted Average Cost of Capital (WACC) adjusted for the forecast level of gearing, and market conditions and risks specific to each CGU. The 

WACC was calculated using the Capital Asset Pricing Model derived from long term industry and market data. 

Future cash flows 

The most recent three year financial forecast, combined with an appropriate growth rate for an extrapolated period of two years, has been assumed 

for the purposes of impairment testing. The growth rates used incorporate the expected recovery in underlying performance of each CGU following 

the recent challenging economic conditions. Budgeted and extrapolated cash flows are reflective of the risks inherent in each CGU. Margins are 

based on the latest forecasts and are consistent with the directors’ future expectations. 

Actual future cash flows may differ significantly from these estimates, due to the effect of changes in market conditions or to subsequent 

decisions on the use of the assets. These differences may have a material impact on the asset values, and impairment calculations reported in 

future periods. 

The short term compound growth rates assumed in the value in use calculations were in the range 5% to 20% per annum (2011: 3% to 27% per 

annum). The long term growth rates applied in perpetuity to each CGU were between 1.3% and 2.5% per annum (2011: 2.5% per annum). 

Sensitivity analysis 

The group has conducted a sensitivity analysis on the impairment test of each CGU’s carrying value. The following sensitivities were applied to 

identify CGUs where an impairment may arise: an increase of 1 percentage point to the discount rate and a reduction of the growth rate; previous 

operating performance is also considered in the context of determining future cash flows. The Asian CGU was identified as having the potential 

to be impaired. The carrying value of the goodwill allocated to the Asian CGU was £4.8m (2011: £4.8m), with the impairment test indicating 

headroom of £1.6m; cash flows were discounted at 10.2%; and an average growth rate of 20% per annum assumed to determine the value in use. 

Increasing the discount rate by 1% or reducing the growth rate by 1% does not result in an impairment. Reducing the average growth rate by 2% 

would remove the remaining headroom. 


9. Intangible Assets 

Customer 

contracts and 

Computer 

Brand names relationships software Total 

£’000 £’000 £’000 £’000 

Cost or valuation 

At 1 April 2010 1,726 14,986 11,397 28,109 

Exchange adjustments - (161) (37) (198) 

Additions - separately acquired - - 1,077 1,077 

Acquisitions - 588 29 617 

Disposals - - (99) (99) 

At 31 March 2011 1,726 15,413 12,367 29,506 

Exchange adjustments (18) (139) (124) (281) 

Additions - separately acquired - - 760 760 

Acquisitions - 1,275 10 1,285 

Disposals - - (408) (408) 

At 31 March 2012 1,708 16,549 12,605 30,862 

Accumulated amortisation 

At 1 April 2010 (1,175) (10,290) (5,655) (17,120) 

Exchange adjustments (12) 27 1 16 

Charge for the year (335) (1,812) (1,755) (3,902) 

Disposals - - 85 85 

At 31 March 2011 (1,522) (12,075) (7,324) (20,921) 

Exchange adjustments 13 86 101 200 

Charge for the year (143) (1,638) (1,722) (3,503) 

Disposals - - 407 407 

At 31 March 2012 (1,652) (13,627) (8,538) (23,817) 

Net book amount: 

At 31 March 2012 56 2,922 4,067 7,045 

At 31 March 2011 204 3,338 5,043 8,585 

There are no intangible assets with indefinite lives. Amortisation is provided in line with the expected benefit derived from each asset over its 

expected useful life, and charged to net operating costs. 

The following useful lives have been determined for the intangible assets carried in the balance sheet: 

Brand names 

Customer contracts and relationships 


- 5 years 

- 1 to 15 years 

- 3 to 8 years 

An element of historic acquisition consideration has been allocated to brand names that have been retained by the group for future marketing 

purposes. 


10. Property, plant and equipment 

Property, 

Freehold land 

plant and 

and buildings equipment Total 

£’000 £’000 £’000 


At 1 April 2010 6,315 23,695 30,010 

Exchange adjustments (55) 99 44 

Additions - separately acquired - 1,305 1,305 

Acquisitions - 98 98 

Disposals - (2,064) (2,064) 

At 31 March 2011 6,260 23,133 29,393 

Exchange adjustments (425) (229) (654) 

Additions - separately acquired - 1,902 1,902 

Acquisitions - 995 995 

Disposals - (1,111) (1,111) 

At 31 March 2012 5,835 24,690 30,525 

Accumulated depreciation 

At 1 April 2010 (3,663) (15,891) (19,554) 

Exchange adjustments 32 (17) 15 

Charge for the year (72) (3,401) (3,473) 

Disposals - 1,169 1,169 

At 31 March 2011 (3,703) (18,140) (21,843) 

Exchange adjustments 278 201 479 

Charge for the year (73) (2,978) (3,051) 

Disposals - 996 996 

At 31 March 2012 (3,498) (19,921) (23,419) 

Net book amount: 


At 31 March 2011 2,557 4,993 7,550 

Assets held under finance leases have the following net book amount: 


£’000 £’000 

Cost 3,211 3,358 

Accumulated depreciation (2,758) (2,112) 

Net book amount 453 1,246 

Assets held under finance leases are vehicles, office equipment and fit-out. Depreciation is charged to net operating costs. 


11. Trade and other receivables 


£’000 £’000 

Trade receivables 74,171 72,581 

Less: Provision for impairment of receivables (11,345) (14,520) 

Trade receivables - net of provisions 62,826 58,061 

Amounts recoverable on contracts 45,210 45,369 

Other receivables 6,998 5,416 

Prepayments and accrued income 3,131 2,901 

118,165 111,747 

The group experiences its maximum exposure to credit risk in relation to its principal financial assets, comprising trade and other receivables, 

amounts recoverable on contracts, and cash and cash equivalents. A provision is made for potential impairment of receivables, based on prior 

experience and an assessment of market conditions. The board believes there is currently no further credit risk provision required in excess of the 

provision for impairment of receivables. 

Amounts due from the group’s joint arrangements are included as trade and other receivables. Additional information regarding these amounts is 

included in note 29. 

Book values of receivables approximate their fair values. 

As of 31 March 2012, trade receivables of £35.0m (2011: £28.6m) were past due but not impaired. The ageing analysis of these trade receivables 

from date of issue is as follows: 


£’000 £’000 

Greater than 180 days 12,152 13,127 

Between 120 days and 180 days 3,178 3,646 





Less than 30 days - - 

34,989 28,593 

Of the balance between 30 and 60 days past due, £7.9m related to one outstanding debtor and has been paid since the balance sheet date. 

The carrying amount of the group’s trade receivables are denominated in the following currencies: 


£’000 £’000 

Sterling 10,713 11,924 

UAE Dirham 14,335 17,987 

Euro 5,797 8,117 

Australian Dollar 13,546 10,178 

Hong Kong Dollar 2,487 2,696 

United States Dollar 1,458 841 

Bahrain Dinar 1,219 1,541 

Qatari Rial 11,280 3,015 

Chinese Yuan 1,523 1,434 

Other 468 328 

Total 62,826 58,061 

Of the Qatari Rial trade receivable balance, £7.9m related to one debtor; this amount has been paid since the balance sheet date. 


11. Trade and other receivables continued 

The allocation of the provision for impairment of receivables according to the date of issue of invoice is as follows: 


£’000 £’000 


Between 120 days and 180 days 165 233 




Less than 30 days - - 

11,345 14,520 

The movement in the provision is analysed below: 


£’000 £’000 

At 1 April 14,520 17,266 

Exchange differences 5 (566) 

On acquisition of subsidiaries 43 - 

Provision made 4,757 5,662 

Released (3,066) (5,520) 

Utilised (4,914) (2,322) 

11,345 14,520 

12. Cash and cash equivalents 


£’000 £’000 

Cash at bank and in hand 22,175 19,319 

Short term bank deposits 1,043 2,901 

23,218 22,220 

The above includes restricted cash of £3.0m (2011: £2.5m), primarily related to the group’s captive cell insurance arrangement and cash covered 

guarantees. 


13. Financial liabilities - borrowings 


£’000 £’000 

Current 

Bank loans 759 887 

Obligations under finance leases 259 582 

1,018 1,469 

Non-current 

Bank loans 6,338 7,100 

Obligations under finance leases 219 555 

6,557 7,655 

Bank loans are all unsecured and bear interest at a margin over LIBOR or foreign equivalents appropriate to the country in which the borrowing is 

incurred. In line with the group’s treasury policy, the group has entered into a number of interest rate swaps in the UK. 

14. Trade and other payables 


Note £’000 £’000 

Trade payables 15 11,950 12,898 

Payments in advance on contracts 28,507 21,687 

Other tax and social security payable 15 5,217 5,985 

Other payables 11,735 11,895 

Accruals 9,608 11,721 

Lease incentives 276 213 

Derivative financial instruments 15 117 152 

Contingent consideration 15 250 265 

67,660 64,816 


15. Financial instruments 

The group’s worldwide operations and debt financing arrangements 

expose it to a variety of risks, such as foreign currency, interest rate, 

credit and liquidity risks. These risks are monitored by the board on 

a periodic basis and a group treasury policy and risk management 

controls are in place for managing these risks. A group risk register is 

maintained and reviewed by the group risk manager, who in turn leads 

the risk management programme within the business. 

The group’s financial instruments comprise cash, bank loans and 

overdrafts, certain payables, and contingent consideration on 

acquisitions, together with various items arising directly from 

operations. An explanation of the group’s objectives, policies and 

strategies for the use of derivatives and other financial instruments 

to manage and control the risks of the group is set out in the Business 

Review on page 28 to 30. 

Foreign currency risk 

With approximately 75% of the group’s revenue generated in 

currencies other than sterling, the group’s balance sheet and income 

statement can be affected by movements in exchange rates. The 

revenue and costs of overseas operations normally arise in the same 

currency and consequently the exposure to exchange differences 

is not normally significant and consequently not hedged. Overseas 

operations maintain local currency overdraft and bonding facilities, 

which provide partial mitigation against balance sheet risk. The group 

enters into forward foreign exchange contracts in order to hedge 

intercompany cash flows. 

The group has £20.2m (2011: £18.2m) of cash and cash equivalents at 

the year end held in bank accounts which is immediately available for 

use. 

At 31 March 2012, if sterling had weakened or strengthened by 10%, a 

reasonably possible change, against the Euro with all other variables 

held constant, post-tax profit for the year would have been £0.1m 

(2011: £0.1m) higher or lower respectively. 

At 31 March 2012, if sterling had weakened or strengthened by 10% 

against the UAE Dirham with all other variables held constant, posttax 

profit for the year would have been £0.1m (2011: £0.2m) higher or 

lower respectively. 

At 31 March 2012, if sterling had weakened or strengthened by 10% 

against the Australian Dollar with all other variables held constant, 

post-tax profit for the year would have been £0.9m (2011: £1.2m) 

higher or lower respectively. 

Interest rate risk 

The group holds a number of bank facilities that are primarily floating 

rate in nature. In 2005, in order to fund special contributions and the 

incentive payments made to transferring members of the AGPS the 

group negotiated an unsecured floating rate loan facility. Given the 

long term nature of this loan the group elected to partially mitigate 

this risk through an interest rate swap. 

enter into interest rate instruments and currency options in order 

to hedge against the effects of future interest and exchange rate 

fluctuations. Surplus funds are invested on short term deposits for 

varying periods of up to three months depending on the immediate 

cash requirements of the group and interest rates available. 

At 31 March 2012, if interest rates on financial instruments had 

decreased or increased by 2%, a reasonably possible change, with all 

other variables held constant, post tax profit for the year would have 

been £0.01m (2011: £0.01m) higher or lower respectively. 

Liquidity risk 

The group has a policy of maintaining a blend of short and long term 

committed facilities designed to ensure there are sufficient funds 

available for operations. To manage working capital and funding 

requirements the group has two principal revolving credit facilities 

in the UK, with HSBC (£22.5m) and Barclays (£18m) which expire in 

December 2015 and February 2013 respectively, a £1.5m overdraft 

with HSBC in the UK and other working capital facilities through local 

relationship banks in the countries that we operate in. In order to 

fund special contributions to the AGPS and incentive payments to 

members, who accepted the offer to transfer their liabilities out of the 

AGPS, the group has 10 year term facilities totalling £7.1m with HSBC 

in the UK. All of the above facilities are unsecured. Total committed 

facilities amount to £48.1m, including £0.5m of finance leases. 

Credit risk 

The group’s main exposure is on amounts due from customers and 

is reported under the relevant balance sheet heading. In line with 

group policy, where possible, appropriate credit checks are performed 

on new customers to identify potential risks. The group recognises 

the increased credit risk in the current economic climate, and seeks 

to mitigate this through strong client relationships and advance 

payments. There are no significant credit risks associated with the 

other balances reported as financial instruments and the group does 

not utilise derivatives to manage its credit risk. The counterparties 

for cash and cash equivalents are limited to financial institutions 

with an AA credit rating or better, except for immaterial balances in 

jurisdictions where there is no alternative. 

Fair values 

The fair value of financial assets and liabilities of the group are not 

considered to be materially different to their reported book value. 

Hedging activities 

At 31 March 2012 the group had a hedging arrangement in place being 

an interest rate swap fixed at a rate of 5.1% against a portion of a 

variable rate loan with a principal amount of £3.5m (2011: £5.0m). 

At 31 March 2012 the group had no other significant hedge 

arrangements in place. It is the group’s policy where necessary to 


15. Financial instruments continued 

Fair value estimation 

Effective 1 April 2010, the group adopted the amendment to IFRS 7 for financial instruments that are measured in the balance sheet at fair value. 

This requires disclosure of fair value measurements by level, based on the fair value measurement hierarchy below: 

– Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1). 

– Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, 

as prices) or indirectly (that is, derived from prices) (level 2). 

– Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3). 

The only financial assets or liabilities that are measured at fair value by the group are the derivative financial instruments recorded as level 2 

liabilities below. 

Liquidity risk of financial liabilities 

The following tables set out the contractual maturity of the undiscounted cash flows of the group’s financial liabilities. 

Weighted 

average period Weighted More Total 

for which rate is average Within 1 to 2 2 to 5 than 5 carrying 

fixed interest rate 1 year years years years amount 

Months % £’000 £’000 £’000 £’000 £’000 

Fixed rate: 

Bank loans 6 6.59 46 - - - 46 

Finance leases 28 6.60 283 93 93 61 530 

329 93 93 61 576 

Floating rate: 

Bank loans 713 715 2,137 3,486 7,051 

713 715 2,137 3,486 7,051 

Non-interest bearing: 

Trade payables 11,950 - - - 11,950 

Other tax and social security payable 5,217 - - - 5,217 

Derivative financial instruments (level 2) 117 82 145 37 381 

Deferred and contingent consideration 250 2,594 - - 2,844 

Total 18,576 3,484 2,375 3,584 28,019 

Obligations under finance leases fall due as follows: More Total 

Within 1 to 2 2 to 5 than 5 carrying 

1 year years years years amount 

£’000 £’000 £’000 £’000 £’000 

Finance leases 283 93 93 61 530 

Less future interest charges (24) (16) (12) - (52) 

Present value of finance lease obligations 259 77 81 61 478 

Interest on fixed rate financial instruments is fixed until maturity, while interest on floating rate financial instruments is repriced at intervals of 

less than one year. 


15. Financial instruments continued 

The effect of interest rate swaps is to modify the amount and interest rates of bank loans as below: 

Weighted More Total 

average Within 1 to 2 2 to 5 than 5 carrying 

interest rate 1 year years years years amount 

% £’000 £’000 £’000 £’000 £’000 

Fixed rate 5.1 401 240 675 626 1,942 

Floating rate - 358 475 1,462 2,860 5,155 

Bank loans after hedging 759 715 2,137 3,486 7,097 

Interest rate risk of financial instruments 

The following table sets out the group’s interest bearing financial instruments, modified for the effect of interest rate swaps, which are 

denominated in the following currencies: 

Cash and Derivative 

cash financial Fixed Floating 

equivalents instruments rate rate Total 

£’000 £’000 £’000 £’000 £’000 

Sterling 5,464 (369) (1,944) (5,155) (2,004) 

UAE Dirham 2,478 - - - 2,478 

Euro 1,902 - (33) - 1,869 

Australian Dollar 10,056 - (440) - 9,616 

Hong Kong Dollar 526 - (3) - 523 

Chinese Yuan 1,631 - - - 1,631 

Other 1,161 - - - 1,161 

Total 23,218 (369) (2,420) (5,155) 15,274 

The cash at bank and in hand balance includes £3.0m (2011: £2.5m), primarily related to the group’s captive cell insurance arrangements and cash 

covered guarantees, which is restricted and not available to the group for general use. 

Foreign currency risk 

The table in note 11 shows the extent to which group companies 

have trade receivables in currencies other than the group’s functional 

currency. Any foreign exchange gain or loss in relation to the 

translation of these assets and liabilities was taken directly to the 

income statement during the year. 

Available borrowing facilities 

The group has £45.8m of undrawn borrowing facilities, as at 31 March 

2012. Of this amount £40.5m relates to the two revolving credit 

facilities in the UK of £22.5m and £18.0m, which were undrawn and 

expire in December 2015 and February 2013 respectively. £5.3m 

relates to uncommitted facilities in various jurisdictions which are 

repayable on demand. All these facilities are unsecured and incur 

commitment fees at market rates. 

Capital management 

The group’s objectives when managing capital are to safeguard the 

group’s ability to continue as a going concern in order to provide 

returns for shareholders and benefits for other stakeholders and to 

maintain an optimal capital structure to reduce the cost of capital. 

In order to maintain or adjust the capital structure, the group may 

adjust the amount of dividends paid to shareholders, return capital to 

shareholders, issue new shares or sell assets to reduce debt. 

The group monitors capital on the basis of the gearing ratio which is 

calculated as net cash/debt divided by total capital, and net cash/ 

debt divided by earnings before interest, taxation, depreciation and 

amortisation (adjusted EBITDA). Net cash/debt is defined as total 

cash and cash equivalents less borrowings. Total capital is calculated 

as shareholders’ equity less net cash. At 31 March 2012 shareholders 

equity was £86.9m (2011: £81.4m) and net cash was £15.6m (2011: 

£13.1m) giving total capital of £71.3m (2011: £68.3m). The group 

operates well within its banking covenants which are disclosed in the 

Financial Review. 


15. Financial instruments - disclosures relating to March 2011 

Liquidity risk of financial liabilities 

The following tables set out the contractual maturity of the undiscounted cash flows of the group’s financial liabilities. 

Weighted 

average period Weighted More Total 

for which rate is average Within 1 to 2 2 to 5 than 5 carrying 

fixed interest rate 1 year years years years amount 

Months % £’000 £’000 £’000 £’000 £’000 

Fixed rate: 

Bank loans 11 6.67 175 46 4 - 225 

Finance leases 11 5.66 637 260 178 223 1,298 

812 306 182 223 1,523 

Floating rate: 

Bank loans and overdrafts 712 713 2,137 4,200 7,762 

712 713 2,137 4,200 7,762 

Non-interest bearing: 

Trade payables 12,898 - - - 12,898 

Other tax and social security payable 5,985 - - - 5,985 

Derivative financial instruments (level 2) 155 87 108 23 373 

Contingent consideration 265 - - - 265 

Total 20,827 1,106 2,427 4,446 28,806 

Obligations under finance leases fall due as follows: 

More Total 

Within 1 to 2 2 to 5 than carrying 

1 year years years 5 years amount 

£’000 £’000 £’000 £’000 £’000 

Finance leases 637 260 178 223 1,298 

Less future interest charges (55) (25) (49) (32) (161) 

Present value of finance lease obligations 582 235 129 191 1,137 

Interest on fixed rate financial instruments is fixed until maturity, while interest on floating rate financial instruments is repriced at intervals of 

less than one year. 

The effect of interest rate swaps is to modify the amount and interest rates of bank loans as below: 

Weighted More Total 

average Within 1 to 2 2 to 5 than 5 carrying 

interest rate 1 year years years years amount 

% £’000 £’000 £’000 £’000 £’000 

Fixed rate 5.1 562 369 726 791 2,448 

Floating rate - 325 390 1,415 3,409 5,539 

Bank loans after hedging 887 759 2,141 4,200 7,987 


15. Financial instruments - Disclosures relating to March 2011 continued 

Interest rate risk of financial instruments 

The following table sets out the group’s interest bearing financial instruments, modified for the effect of interest rate swaps, which are 

denominated in the following currencies: 

Cash and Derivative 

cash financial Fixed Floating 

equivalents instruments rate rate Total 

£’000 £’000 £’000 £’000 £’000 

Sterling 4,427 (352) (2,506) (5,539) (3,970) 

UAE Dirham 2,356 - - - 2,356 

Euro 1,747 - (182) - 1,565 

Australian Dollar 10,327 - (870) - 9,457 

Hong Kong Dollar 119 - (27) - 92 

Chinese Yuan 966 - - - 966 

Other 2,278 - - - 2,278 

Total 22,220 (352) (3,585) (5,539) 12,744 

The cash at bank and in hand balance includes £2.5m, predominantly held by the group’s captive cell insurance arrangement, which is restricted 

and not available to the group for general use. 


16. Provisions 

Professional 

indemnity 

Vacant 

insurance property Total 

£’000 £’000 £’000 

At 1 April 2011 3,484 1,336 4,820 

Exchange adjustments 2 6 8 

Charged to the income statement 177 1,761 1,938 

Released to the income statement (373) (306) (679) 

Utilised (375) (581) (956) 

Unwinding of discount - 81 81 


At 31 March 2012 

Current liabilities 2,915 1,043 3,958 

Non-current liabilities - 1,254 1,254 

2,915 2,297 5,212 

At 31 March 2011 

Current liabilities 3,484 717 4,201 

Non-current liabilities - 619 619 

Professional indemnity insurance 

3,484 1,336 4,820 

The provision reflects management’s estimate of the likely cost of claims including professional indemnity insurance excesses and has been 

provided in accordance with group policy. These provisions will be carried forward until the claims to which they relate are agreed and amounts 

utilised or released as appropriate. 

Vacant property 

The provision represents the estimated net present value of future rentals where properties are vacant. These provisions will be utilised up until 

such time as the vacant properties are re-let (when the requirement for a provision will be reassessed), or the lease terminates, whichever occurs 

earlier. The maximum period covered by these provisions is 7 years. £1.3m of the charge for the year has been recorded as an exceptional item. 


17. Deferred tax 

Deferred tax is calculated in full on temporary differences under the liability method using the appropriate statutory tax rates in each jurisdiction. 


£’000 £’000 

At 1 April 9,348 9,820 

Exchange adjustments (7) 250 

Credit to the income statement 73 1,404 

Credit/(charge) to other comprehensive income for the year 263 (2,126) 

Acquisitions (254) - 

At 31 March 9,423 9,348 

Comprising: 

Deferred tax assets 10,373 10,079 

Deferred tax liabilties (950) (731) 

9,423 9,348 

Deferred tax assets have been recognised in respect of tax losses and other temporary differences where it is probable that these assets will be 

recovered in the foreseeable future. A deferred tax asset has been recognised in respect of the defined benefit pension deficits in the UK and 

Germany, based on the expected taxable profits of these businesses. 

Deferred tax assets of £6.2m (2011: £5.2m) have not been recognised in respect of losses amounting to £29.8m (2011: £26.0m) as it is not 

probable that there will be future taxable profits within the entities against which the losses can be utilised. 

Deferred tax liabilities of £0.1m (2011: £0.1m) have not been recognised for the withholding and other taxes which would be payable on the 

unremitted earnings of certain overseas subsidiaries, as no tax is expected to be payable in the foreseeable future. 

Deferred tax assets and liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the balances 

net. The movements in deferred tax assets and liabilities (prior to the offsetting of balances within the same jurisdiction as permitted by IAS 12) 

‘Income Taxes’ during the period are shown below: 

Other short 

Amounts Post Accelerated term 

Intangible recoverable employment tax timing 

assets on contracts benefits depreciation differences Losses Total 

Deferred tax £’000 £’000 £’000 £’000 £’000 £’000 £’000 

At 1 April 2011 (488) 91 4,052 1,343 2,745 1,605 9,348 

Credit/(charge) to the income statement: 

Current year 255 (62) (860) 79 (339) (25) (952) 

Adjustment in respect of prior years 31 (7) - 3 463 535 1,025 

286 (69) (860) 82 124 510 73 

Credit to other comprehensive income: 

Current year - - 263 - - - 263 

- - 263 - - - 263 

Acquisitions (254) - - - - - (254) 

Exchange adjustments 16 58 (2) 2 (7) (74) (7) 

At 31 March 2012 (440) 80 3,453 1,427 2,862 2,041 9,423 


17. Deferred tax continued 

Other short 

Amounts Post Accelerated term 

Intangible recoverable employment tax timing 

assets on contracts benefits depreciation differences Losses Total 

Deferred tax £’000 £’000 £’000 £’000 £’000 £’000 £’000 

At 1 April 2010 (838) (1,035) 5,711 865 3,420 1,697 9,820 

Credit/(charge) to the income statement: 

Current year 338 854 467 468 (54) (172) 1,901 

Adjustment in respect of prior years - 196 - 9 (800) 98 (497) 

338 1,050 467 477 (854) (74) 1,404 

Charge to other comprehensive income: 

Current year - - (2,126) - - - (2,126) 

(2,126) - - - (2,126) 

Exchange adjustments 12 76 - 1 179 (18) 250 

At 31 March 2011 (488) 91 4,052 1,343 2,745 1,605 9,348 

18. Other non-current liabilities 


£’000 £’000 

Other payables 3,046 1,788 

Deferred and contingent consideration 2,594 - 

Derivative financial instruments 252 200 

5,892 1,988 

19. Called up ordinary share capital 

Issued and fully paid: Shares £’000 

At 1 April 2010 38,370,320 3,837 

Issued in relation to exercised share options 169,960 17 

At 31 March 2011 38,540,280 3,854 


At 31 March 2012 38,634,530 3,863 

During the year, options were exercised on 7,000 shares at 87.5p, 21,000 shares at 139.5p, 25,000 shares at 194.0p, 15,000 shares at 256.3p, 5,000 

shares at 254.8p, and 21,250 shares at 348.5p. The total consideration for these shares was £0.2m. 


20. Share Based Payments 

Share options 

Set out below are summaries of options granted under Hyder group schemes: 

As at 31 March 2012 

Awards Awards Awards 

Exercise outstanding Granted Exercised Forfeited outstanding exercisable 

price Fair value Number of at 31 during the during the during the at 31 at 31 

Scheme Award date (p) (p) employees March 2011 year year year March 2012 March 2012 

ESOS 19-Jun-03 87.5 35.5 4 32,000 - (7,000) (5,000) 20,000 20,000 

ESOS 03-Aug-04 139.5 57.1 14 70,000 - (21,000) (1,000) 48,000 48,000 

ESOS 10-Jun-05 194.0 76.4 11 115,000 - (25,000) - 90,000 90,000 

ESOS 30-Jun-06 256.3 99.1 16 135,000 - (15,000) - 120,000 120,000 

ESOS 03-Jul-06 254.8 98.9 - 5,000 - (5,000) - - - 

ESOS 15-Jun-07 525.0 139.0 3 17,500 - - (7,000) 10,500 10,500 

ESOS 18-Jul-08 348.5 71.0 15 127,500 - (21,250) (4,250) 102,000 102,000 

LTIP (A) 15-Jun-07 Nil 505.9 2 5,332 - - - 5,332 5,332 

LTIP (A) 18-Jul-08 Nil 337.7 3 28,000 - (6,289) (2,844) 18,867 18,867 

LTIP (A) 19-Jun-09 Nil 139.8 17 203,534 - - (6,756) 196,778 - 

LTIP (A) 16-Jun-10 Nil 277.5 21 176,058 - (2,454) (3,111) 170,493 - 

LTIP (A) 15-Jun-11 Nil 381.0 29 - 167,844 - - 167,844 - 

LTIP (B) 11-Dec-08 Nil 150.7 2 494,522 - - (150,807) 343,715 343,715 

LTIP (B) 19-Jun-09 Nil 139.8 2 72,071 - - - 72,071 - 

LTIP (B) 16-Jun-10 Nil 241.8 2 171,185 - - - 171,185 - 

LTIP (B) 15-Jun-11 Nil 253.0 2 - 134,033 - - 134,033 - 

1,652,702 301,877 (102,993) (180,768) 1,670,818 758,414 

Weighted average exercise/transfer price (p) 75.25 - 203.08 31.72 58.48 128.84 

The group recognised total expenses of £0.7m related to share based payment transactions (2011: £0.4m). 

The weighted average outstanding period until expiry on outstanding awards at 31 March 2012 is 6.94 years. 

As at 31 March 2011 




Scheme Award date (p) (p) employees March 2010 year year year March 2011 March 2011 

ESOS 19-Jun-03 87.5 35.5 7 49,400 - (17,400) - 32,000 32,000 

ESOS 03-Aug-04 139.5 57.1 22 112,000 - (42,000) - 70,000 70,000 

ESOS 10-Jun-05 194.0 76.4 14 175,000 - (60,000) - 115,000 115,000 

ESOS 30-Jun-06 256.3 99.1 18 195,000 - (45,000) (15,000) 135,000 135,000 

ESOS 03-Jul-06 254.8 98.9 1 5,000 - - - 5,000 5,000 

ESOS 15-Jun-07 525.0 139.0 5 115,500 - - (98,000) 17,500 17,500 

ESOS 18-Jul-08 348.5 71.0 20 182,750 - (5,560) (49,690) 127,500 - 

LTIP (A) 24-Aug-06 Nil 302.4 - 22,893 - (22,893) - - - 

LTIP (A) 15-Jun-07 Nil 505.9 2 35,916 - (13,380) (17,204) 5,332 5,332 

LTIP (A) 18-Jul-08 Nil 337.7 4 55,500 - (12,500) (15,000) 28,000 - 

LTIP (A) 19-Jun-09 Nil 139.8 18 255,629 - (2,267) (49,828) 203,534 - 

LTIP (A) 16-Jun-10 Nil 277.5 23 - 180,661 - (4,603) 176,058 481 

LTIP (B) 11-Dec-08 Nil 150.7 2 494,522 - - - 494,522 - 

LTIP (B) 19-Jun-09 Nil 139.8 2 72,071 - - - 72,071 - 

LTIP (B) 16-Jun-10 Nil 241.8 2 - 171,185 - - 171,185 - 

1,771,181 351,846 (221,000) (249,325) 1,652,702 380,313 


No options expired during the periods covered by the above tables. 


20. Share Based Payments continued 

The fair value of share options with non-market performance conditions has been calculated using the Black Scholes option pricing model. The fair 

value of options with market-related performance conditions are measured using the Monte Carlo model. Expected volatility was determined by 

calculating the historical volatility of the group’s share price over a period prior to grant date equal in length to the vesting period, which equates 

to a three-year share price history (2011: three-year share price history). The risk free rate of return was assumed to be the yield to maturity on a 

UK gilt strip with the term to maturity equal to the expected life of the option. The expected dividend yield is an estimate of the dividend yield 

at the date of grant for the duration of the option’s life. 

The assumptions used in the valuation model are as follows: 

LTIP - LTIP - 

EPS conditions TSR conditions 

Jun 11 Jun 11 

Risk free rate of return 1.31% 1.30% 

Dividend yield 1.92% 2.00% 

Share price volatility 68.82% - 

Peer group volatility - 50.00% 

Vesting period 3 years 3 years 

Expected life 7 years 7 years 

Share price at grant date 403.63p 410.00p 

21. Share premium account 

Issued and fully paid: 

£’000 

At 1 April 2010 29,281 

Premium on ordinary shares issued during the year 308 

At 31 March 2011 29,589 

Premium on ordinary shares issued during the year 200 

At 31 March 2012 29,789 


22. Other reserves 

Capital 

Cash flow 

redemption Translation hedge Own 

reserve reserve reserve shares Total 

£’000 £’000 £’000 £’000 £’000 

At 1 April 2010 80 14,889 (488) (1,039) 13,442 

Cash flow hedges recognised - - 133 - 133 

Employee trust purchase of own shares - - - (559) (559) 

Transfer of own shares from EBT - - - 96 96 

Exchange adjustments - (1,795) - - (1,795) 

At 31 March 2011 80 13,094 (355) (1,502) 11,317 

Cash flow hedges recognised - - (48) - (48) 

Employee trust purchase of own shares - - - (361) (361) 

Transfer of own shares from EBT - - - 19 19 

Exchange adjustments - (1,344) - - (1,344) 

At 31 March 2012 80 11,750 (403) (1,844) 9,583 

The capital redemption reserve is not distributable. 

The translation reserve consists of cumulative gains and losses arising on the translation of overseas operations. 

The cash flow hedge reserve includes the fair value of hedging derivatives where such instruments are designated and effective as hedges of future 

cash flows. 

Own shares represent 801,976 shares (2011: 710,719 shares) held in the Employee Benefit Trust (EBT) for use in satisfying obligations under the 

Long Term Incentive Plan (LTIP). As at 31 March 2012, the EBT had an agreement in place to waive dividends on all shares held. 


23. Notes to the Consolidated cash flow Statement 

(a) Cash flows from operating activities 


£’000 £’000 

Profit for the financial year 13,923 14,882 

Adjustments for: 

Tax 3,723 3,297 

Depreciation 3,051 3,473 

Amortisation - software 1,722 1,755 

Amortisation - acquisitions 1,781 2,147 

Acquisition costs 681 - 

Exceptional items 1,499 - 

Interest receivable (1,423) (933) 

Interest payable and similar charges 847 910 

EBITDA 25,804 25,531 

Profit on disposal of property, plant and equipment 9 680 

Fair value gain on financial instruments (30) (19) 

Share option costs 660 414 

Decrease in provisions (960) (920) 

Decrease in post employment benefits (13) (898) 

Deficit contributions to the AGPS defined benefit pension scheme (3,919) (3,030) 

Changes in working capital: 

(Increase)/decrease in trade and other receivables (3,841) 6,531 

Decrease in trade and other payables (2,080) (9,125) 

Cash generated from operations 15,630 19,164 

(b) Reconciliation of movement in net cash 

At 1 April Non-cash Exchange At 31 March 

2011 Cash flow movement movement 2012 

£’000 £’000 £’000 £’000 £’000 

Cash at bank 22,220 1,048 - (50) 23,218 

Debt due within 1 year (887) 891 (762) (1) (759) 

Debt due after 1 year (7,100) - 762 - (6,338) 

Finance leases due within 1 year (582) 837 (507) (7) (259) 

Finance leases due after 1 year (555) - 334 2 (219) 

Total debt (9,124) 1,728 (173) (6) (7,575) 

Net cash 13,096 2,776 (173) (56) 15,643 

The cash at bank balance includes £3.0m (2011: £2.5m) that is restricted and not available to the group for general use. 

Net non-cash movements comprise £173,000 of finance leases acquired with ESR Technology Limited. 


24. Acquisitions 

The group purchased two companies, and the business and assets of a third company during the year for a total potential consideration of £5.8m. 

The purchases have been accounted for as business combinations. Had these acquisitions completed on the first day of the financial year, group 

revenues for the year would have been £283.7m and group adjusted operating profit would have been £21.3m. 

Percentage 

Date of Location of of equity 

acquisition operation acquired 

ESR Technology Limited 23 June 2011 UK 100% 

SAK Engineering Consultants 15 February 2012 Saudi Arabia 70% 

GW Engineers Limited 1 March 2012 Australia 100% 

The acquisitions have contributed the following revenue and adjusted operating profit: 

Adjusted 

operating 

Revenue profit/(loss) 

£’000 £’000 

ESR Technology Limited 5,420 144 

SAK Engineering Consultants 175 (13) 

GW Engineers Limited 526 (22) 

Details of the provisional fair value of assets and liabilities, goodwill and intangible assets are as follows: 

ESR Technology Limited 

Fair value 

adjustment 

Total 

£’000 £’000 £’000 

Intangible assets 10 977 987 

Property, plant and equipment 772 (46) 726 

Trade and other receivables 2,099 - 2,099 

Corporation tax recoverable 3 - 3 

Cash and cash equivalents 305 - 305 

Trade and other payables (2,305) (757) (3,062) 

Payments in advance on contracts (1,043) 75 (968) 

Deferred tax liabilities - (254) (254) 

Borrowings (173) - (173) 

Net liabilities acquired (332) (5) (337) 

Goodwill 337 

Gross consideration (cash) - 

Fair value adjustments comprise the recognition of intangible assets related to contracts and customer relationships acquired; a write down in the 

value of property, plant and equipment; an increase in the accrual for dilapidations in respect of leased properties; the application of our revenue 

recognition policy; and a deferred tax liability in respect of the intangible assets. 

- 


24. Acquisitions continued 

SAK Engineering Consultants 

Fair value 

adjustment 

Total 

£’000 £’000 £’000 

Intangible assets - 298 298 

Property, plant and equipment 30 - 30 

Trade and other receivables 10 - 10 

Amounts recoverable on contracts 51 - 51 

Trade and other payables (42) - (42) 

Post employment benefits (372) - (372) 

Net liabilities acquired (323) 298 (25) 

Non-controlling interest acquired (349) 

Goodwill 1,537 

Gross consideration (cash) 1,163 

Fair value adjustments comprise the recognition of intangible assets related to contracts and customer relationships acquired. 

1,163 

GW Engineers Limited 

Fair value 

adjustment 

Total 

£’000 £’000 £’000 

Property, plant and equipment 438 (199) 239 

Trade and other receivables 990 - 990 

Amounts recoverable on contracts 51 55 106 

Cash and cash equivalents 294 - 294 

Trade and other payables (1,035) - (1,035) 

Net assets acquired 738 (144) 594 

Goodwill 4,010 

Consideration 

Cash consideration 1,972 

Contingent consideration 2,632 

Gross consideration 4,604 

4,604 

Fair value adjustments comprise a write down in the value of property, plant and equipment and the application of our revenue recognition policy. 

Adjustments are provisional and may be revised. 

The cash flows arising from all acquisitions are as follows: 

Total 

£’000 

Cash consideration 3,135 

Cash acquired (599) 

Net cash outflow 2,536 

Subsequent to the acquisition of Ingenieur Consult Technische Gesamptplanung Dresden (IC Dresden) on 1 January 2011, a fair value adjustment of 

£58,343 was made to reflect a revaluation of the amounts recoverable on contracts at acquisition. This has resulted in an increase to goodwill. 


25. Employee costs 

(a) Employee costs 


£’000 £’000 

Salaries and benefits 149,053 156,552 

Redundancy costs 1,502 2,925 

Social security costs 9,198 8,972 

Pension costs 7,663 8,951 

Share based payment expense 660 414 

168,076 177,814 

(b) Aggregate cost of persons discharging managerial responsibility remuneration 

Salaries and benefits 2,541 2,449 

Pension costs 149 98 

Share based payment expense 485 291 

3,175 2,838 

The group has identified 10 persons (2011: 11) discharging managerial responsibility during the course of the year, comprising the Hyder Consulting 

PLC directors and the regional managing directors. Full details of the Hyder Consulting PLC directors’ remuneration can be found in the Directors’ 

Remuneration Report on page 69. 

(c) Average monthly numbers of employees during the year (including executive directors) 


Number Number 

Technical 3,192 3,360 

Administration (including executive directors) 479 499 

3,671 3,859 

As at 31 March 2012 the group had 3,774 employees (2011: 3,697) including 2 executive directors (2011: 2). 

(d) Average monthly numbers of employees during the year (including executive directors) by geography 


Number Number 

Australia 670 776 

Asia 442 436 



UK 1,118 1,204 

Germany 405 371 

Europe 1,523 1,575 

3,671 3,859 


26. post employment benefits 

Employees of the group participate in a number of pension schemes both in the UK and overseas. The assets of each pension scheme are held 

separately from the assets of the group and are administered by trustees. 

Hyder Consulting (UK) Limited is the principal employer of the Acer Group Pension Scheme (AGPS), a defined benefit scheme. The pension cost for 

the AGPS has been assessed in accordance with actuarial advice, using the projected unit method. For this purpose the main actuarial assumptions 

used are based on a discount rate of 4.7% (2011: 5.5%) per annum, investment return of 6.2% (2011: 7.3%) per annum, and increases to pensions 

in payment of 2.45% (2011: 2.55%), 3.15% (2011: 3.4%) and 2.15% (2011: 2.2%) per annum for increases in line with the RPI capped at 3%, 5% 

and 2.5% respectively. A full actuarial valuation of the AGPS was carried out as at 1 April 2011 and updated to 31 March 2012 by a qualified 

independent actuary. The contributions made to the scheme in the year were £4.0m (2011: £4.5m). The scheme was closed to future benefit 

accrual on 30 April 2011. 

The post retirement mortality assumption incorporates a scheme specific base table and an allowance for future improvements in mortality rates 

from 2004 onwards in line with the 2010 Continuous Mortality Investigation with a long term improvement rate of 1.5% and a 100% convergence 

rate. 

Audit fees for the AGPS amounted to £10,108 for the year (2011: £10,080). 

The key assumptions and the sensitivities of the AGPS 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 2-3% 

During the year contributions were made to the Hyder Consulting (UK) Limited Group Personal Pension Plan, a defined contribution scheme. 

Post employment benefit schemes are also maintained in Germany and the Middle East, and there is a small unfunded annuitants scheme in the UK. 

The most significant of these is the requirement in certain Gulf States to pay terminal gratuities to employees based on the length of service when 

they leave the employment of the group. During the year, this scheme was valued by an actuary for the first time. The main assumptions used for 

this valuation were a discount rate of 4.0% per annum, salary increases of between 1.0% and 2.0% per annum, and an average remaining service 

period of between 6 and 25 years. 

The group’s net liabilities in respect of post employment benefits comprise the following: 


£’000 £’000 

AGPS 16,305 17,267 

Overseas and unfunded annuitants schemes 7,930 6,687 

24,235 23,954 

Pension costs are as follows: 


Net operating costs: £’000 £’000 

Defined contribution schemes: 

- UK 3,461 2,361 

- Overseas 4,090 4,269 

Defined benefit schemes: 

- AGPS 57 1,500 

- Overseas and unfunded annuitants schemes 984 1,287 

8,592 9,417 

Net finance income: 

Defined benefit schemes: 

- AGPS (1,214) (524) 

- Overseas and unfunded annuitants schemes 285 58 

(929) (466) 

7,663 8,951 


26. post employment benefits continued 

AGPS scheme 

The key assumptions used were: 2012 2011 

Rate of increase in salaries n/a 3.20% 

Rate of increase to pensions in payment: 

- Index linked pensions with max 3% per annum increases 2.45% 2.55% 

- Other index linked pension 3.15% 3.40% 

Discount rate 4.70% 5.50% 

Inflation assumptions (RPI) 3.30% 3.60% 

Inflation assumptions (CPI) 2.30% 3.00% 

Longevity at age 65 for current pensioners 

- Men 23.2 years 23.3 years 

- Women 24.9 years 25.3 years 

Longevity at age 65 for future pensioners 

- Men 25.4 years 25.4 years 

- Women 27.4 years 27.2 years 

The assets in the scheme and the expected rates of return were: 

Long-term rate of Value at Long-term rate of Value at 

return expected 31 March return expected at 31 March 

at 31 March 2012 2012 31 March 2011 2011 

% per annum £’000 % per annum £’000 

Equity like assets 7.10 87,869 8.15 79,777 

Bond like assets 4.30 40,153 5.35 34,342 

Cash 0.50 514 0.50 621 

Total market value of assets 128,536 114,740 

Present value of scheme liabilities (144,841) (132,007) 

Deficit in the scheme (16,305) (17,267) 

Related deferred tax asset 3,233 3,809 

Net pension deficit (13,072) (13,458) 

Amounts recognised in the income statement in respect of the AGPS scheme are as follows: 


£’000 £’000 

Current service costs (112) (1,500) 

Past service costs (521) - 

Pension scheme settlements and curtailments 576 - 

Notional interest on pension liability (7,122) (7,071) 

Expected return on scheme assets 8,336 7,595 

1,157 (976) 



Movements in the present value of AGPS scheme obligations are as follows: 


£’000 £’000 

At 1 April 132,007 127,570 

Current service costs 112 1,500 

Past service costs 521 - 

Notional interest on pension liability 7,122 7,071 

Curtailments (576) - 

Actuarial loss/(gain) 10,766 (12) 

Contributions by plan participants 7 95 

Benefits paid from plan (5,118) (4,217) 

At 31 March 144,841 132,007 

Movements in the fair value of AGPS scheme assets are as follows: 


£’000 £’000 

At 1 April 114,740 101,772 

Expected return on plan assets 8,336 7,595 

Contributions by employers 4,031 4,530 

Actuarial gain 6,540 4,965 

Contributions by plan participants 7 95 

Benefits paid from plan (5,118) (4,217) 

At 31 March 128,536 114,740 

Actual return on scheme assets was £14,876,000 (2011: £12,560,000). 

History of experience gains and losses: 

2012 2011 2010 2009 2008 

£’000 £’000 £’000 £’000 £’000 

Fair value of scheme assets 128,536 114,740 101,772 75,714 87,530 

Present value of scheme obligations (144,841) (132,007) (127,570) (102,239) (110,694) 

Deficit in the scheme (16,305) (17,267) (25,798) (26,525) (23,164) 

Experience adjustments on scheme assets 

Amount (£’000) 6,540 4,965 17,886 (18,909) 3,448 

Percentage of scheme assets 5% 4% 18% (25%) 4% 

Experience adjustments on scheme liabilities 

Amount (£’000) (10,766) 12 (21,318) 13,037 2,102 

Percentage of scheme liabilities 7% 0% 17% (13%) 2% 

The estimated amount of contributions expected to be paid into the AGPS during the year ended 31 March 2013 is £1.8m. 

At the date of the last funding valuation (1 April 2011), the AGPS held assets to the value of £114.1m. This represented a funding level of 86% of 

the AGPS’ accrued liabilities at that date (1 April 2008: 73%). 

Cumulative actuarial losses recognised since 1 April 2004 were £18,086,000. 



Other post employment benefit schemes 

Amounts recognised in the income statement in respect of the overseas and unfunded annuitants employee benefit schemes are as follows: 


£’000 £’000 

Current service costs (984) (1,287) 

Notional interest on pension liability (287) (61) 

Expected return on scheme assets 2 3 

(1,269) (1,345) 

Movements in the present value of overseas and unfunded annuitants scheme obligations were as follows: 


£’000 £’000 

At 1 April 7,011 8,031 


Pension liability acquired 372 - 

Current service costs 984 1,287 

Notional interest on pension liability 287 61 

Actuarial loss 544 146 

Benefits paid from plan (942) (2,165) 

At 31 March 8,237 7,011 

Movements in the fair value of overseas assets were as follows: 


£’000 £’000 

At 1 April 324 302 


Expected return on plan assets 2 3 

Contributions by employers - 20 

At 31 March 307 324 


27. Operating lease commitments - minimum lease payments 

At 31 March 2012, the group’s total remaining commitments as lessee under non-cancellable operating leases for certain of its office properties 

and vehicles, plant and equipment were as follows: 

Vehicles, 

Vehicles, 

plant and 

plant and 

Property equipment Property equipment 

2012 2012 2011 2011 

£’000 £’000 £’000 £’000 

Rental payable: 

In one year or less 5,583 2,999 6,746 2,872 

In more than one year but no more than two 3,869 2,182 4,512 1,701 

In more than two years but no more than five 6,940 2,982 7,638 2,250 

Greater than five years 2,588 - 3,756 - 

18,980 8,163 22,652 6,823 

Where the group has vacated a property prior to the end of the lease term, the group will attempt to sublease such vacant space on short term 

lets. The sublease rental income for the year to 31 March 2012 was £225,000 (2011: £202,000). The minimum rent receivable under noncancellable 

operating leases is as follows: 


£’000 £’000 

Rental receivable: 

In one year or less 189 196 

In more than one year but no more than two 162 115 

In more than two years but no more than five 326 139 

Greater than five years 29 60 

706 510 

28. Contingent liabilities 

The group maintains professional indemnity insurance against claims for professional negligence which in the ordinary course of business have 

been, or may in the future be, received. The directors assess each claim and make provision for legal and settlement costs where, on the basis of 

advice received, it is considered that a liability may exist. 

Hyder Consulting PLC and various group companies have entered into tender bonds, performance bonds, and advance payment bonds supporting 

project requirements and certain other bonds and guarantees in the ordinary course of business. The group’s liabilities under performance 

guarantees are only limited to the extent of the underlying contracts. The directors do not consider any provision is necessary in respect of 

guarantees and bonds. 


29. Related Party Transactions 

The group has entered into transactions on an arm’s length basis with related parties, mostly jointly controlled operations, during the year. 

Transactions relating to sales of consulting services to these jointly controlled operations amounted to £41.8m (2011: £49.9m). 

Net amounts due from these jointly controlled operations amounted to £10.0m (2011: £8.3m), and are included within trade and other receivables 

(note 11), as the group utilises these arrangements primarily as special purpose billing vehicles on project related ventures with our partners. A 

listing of significant jointly controlled operations is set out below: 

Country of incorporation/ 

Legal status 

region of operation 

Hunter Expressway Alliance Unincorporated Asia-Pacific 

Tulla-Sydney Freeway Alliance Unincorporated Asia-Pacific 

Airport Link Teaming Arrangement Unincorporated Asia-Pacific 

Hyder-Arup-Black & Veatch JV* Incorporated Asia-Pacific 

Aurecon-Hyder JV Unincorporated Asia-Pacific 

Sapphire to Woolgoolga Teaming Arrangement Unincorporated Asia-Pacific 

Hyder Meinhardt JV Unincorporated Asia-Pacific 

Airport Berlin-Brandenburg Consult Unincorporated Europe 

Hyder Consulting Middle East Limited & WS Atkins & Partners Overseas Unincorporated Middle East 

Hyder Halcrow JV Unincorporated UK 

Faber Maunsell Hyder JV Unincorporated UK 

* The group holds a 40% interest in the jointly controlled operation’s ordinary share capital. 

Unincorporated jointly controlled operations are normally operated from the relevant Hyder regional office. 

30. Principal group undertakings 

The following principal subsidiaries are consolidated within the group results: 

Country of Direct Indirect 

incorporation shareholding shareholding 

% % 

Hyder Consulting Holdings Limited England and Wales 100 

Hyder Consulting Group Limited England and Wales 100 

Hyder Germany GmbH Germany 100 

Hyder Consulting Limited Hong Kong 100 

Hyder Consulting Middle East Limited Guernsey 100 

Hyder Consulting Europe Limited England and Wales 100 

Hyder Consulting (UK) Limited England and Wales 100 

Hyder Consulting Overseas Holdings Limited England and Wales 100 

Hyder Consulting Holdings Pty Limited Australia 100 

The group’s interest in principal subsidiaries entirely comprises ordinary equity shares. The group owns 100% of the preference shares in the Hyder 

cell within HSBC Insurance PCC Limited, a Guernsey registered company. 


Hyder Consulting PLC (Company) Financial Statements 

Contents 

Page 

Independent Auditors’ Report 118 

Balance Sheet 119 

Reconciliation of Movement in Shareholders’ Funds 119 

Notes to the Financial Statements 120 


Independent auditors’ report to the Members of Hyder Consulting plc limited 

We have audited the parent company Financial Statements of Hyder 

Consulting PLC for the year ended 31 March 2012 which comprise the 

balance sheet, the reconciliation of movements in shareholders’ funds 

and the related notes. The financial reporting framework that has been 

applied in their preparation is applicable law and United Kingdom 

Accounting Standards (United Kingdom Generally Accepted Accounting 

Practice). 

Respective responsibilities of directors and auditors 

As explained more fully in the Directors’ Responsibilities Statement 

set out on pages 62 and 63, the directors are responsible for the 

preparation of the parent company Financial Statements and for 

being satisfied that they give a true and fair view. Our responsibility 

is to audit and express an opinion on the parent company Financial 

Statements in accordance with applicable law and International 

Standards on Auditing (UK and Ireland). Those standards require us 

to comply with the Auditing Practices Board’s Ethical Standards for 

Auditors. 

This report, including the opinions, has been prepared for and only for 

the company’s members as a body in accordance with Chapter 3 of Part 

16 of the Companies Act 2006 and for no other purpose. We do not, 

in giving these opinions, accept or assume responsibility for any other 

purpose or to any other person to whom this report is shown or into 

whose hands it may come save where expressly agreed by our prior 

consent in writing. 

Scope of the audit of the Financial Statements 

An audit involves obtaining evidence about the amounts and 

disclosures in the Financial Statements sufficient to give reasonable 

assurance that the Financial Statements are free from material 

misstatement, whether caused by fraud or error. This includes an 

assessment of: whether the accounting policies are appropriate to the 

parent company’s circumstances and have been consistently applied 

and adequately disclosed; the reasonableness of significant accounting 

estimates made by the directors; and the overall presentation of 

the Financial Statements. In addition, we read all the financial and 

non-financial information in the Annual Report to identify material 

inconsistencies with the audited Financial Statements. If we become 

aware of any apparent material misstatements or inconsistencies we 

consider the implications for our report. 

Opinion on other matters prescribed by the Companies Act 2006 

In our opinion: 

- the part of the Directors’ Remuneration Report to be audited has 

been properly prepared in accordance with the Companies Act 

2006; and 

- the information given in the Directors’ Report for the financial 

year for which the parent company Financial Statements are 

prepared is consistent with the parent company Financial 

Statements. 

Matters on which we are required to report by exception 

We have nothing to report in respect of the following matters where 

the Companies Act 2006 requires us to report to you if, in our opinion: 

- adequate accounting records have not been kept by the 

company, or returns adequate for our audit have not been 

received from branches not visited by us; or 

- the parent company Financial Statements and the part of the 

Directors’ Remuneration Report to be audited are not in 

agreement with the accounting records and returns; or 

- certain disclosures of directors’ remuneration specified by law 

are not made; or 

- we have not received all the information and explanations we 

require for our audit. 

Other matter 

We have reported separately on the group Financial Statements of 

Hyder Consulting PLC for the year ended 31 March 2012. 

Bowker Andrews (Senior Statutory Auditor) 

for and on behalf of PricewaterhouseCoopers LLP 

Chartered Accountants and Statutory Auditors 

London 


Opinion on Financial Statements 

In our opinion the Financial Statements: 

- give a true and fair view of the state of the company’s affairs as 

at 31 March 2012; 

- have been properly prepared in accordance with United Kingdom 

Generally Accepted Accounting Practice; and 

- have been prepared in accordance with the requirements of the 

Companies Act 2006. 


Balance sheet as at 31 March 2012 


Note £’000 £’000 

Fixed assets 

Tangible assets 2 6 - 

Investments 3 14,676 14,676 

14,682 14,676 

Current assets 

Debtors 4 23,389 23,890 

Cash at bank and in hand 4,033 5,599 

27,422 29,489 

Current liabilities 

Creditors 5 (659) (444) 

Net current assets 26,763 29,045 

Total net assets 41,445 43,721 

Capital and reserves 

Called up share capital 6 3,863 3,854 

Share premium account 7 29,789 29,589 

Other reserves 8 (1,764) (1,422) 

Retained earnings 9 9,557 11,700 

Total shareholders’ funds 41,445 43,721 

The Financial Statements on pages 119 to 125 were approved by the board of directors and were signed on its behalf by: 

Ivor Catto 



Russell Down 



Reconciliation of movements in shareholders’ funds for the year ended 31 March 2012 


£’000 £’000 

Profit for the year 243 6,382 

Dividends (3,027) (2,358) 

(2,784) 4,024 

Issue of ordinary shares 9 17 

Premium on issue of ordinary shares 200 308 

Purchase of own shares (361) (559) 

Share based payments 660 414 

Net change in shareholders’ funds (2,276) 4,204 

Shareholders’ funds at 1 April 43,721 39,517 

Shareholders’ funds at 31 March 41,445 43,721 


Principal accounting policies 

The Financial Statements have been prepared in accordance with 

Accounting Standards applicable in the United Kingdom and comply 

with the Companies Act 2006. A summary of the principal accounting 

policies, which have been consistently applied, is set out below. 

Basis of accounting 

These Financial Statements have been prepared in accordance with the 

historical cost convention, except for the recognition of derivative 

financial instruments detailed below. 

No profit and loss account is presented for the company as permitted 

by Section 408 of the Companies Act 2006. 

Cash flow statement 

The company has taken the exemption under Financial Reporting 

Standard 1 (revised) not to prepare a cash flow statement as the 

company’s cash flows are included in the consolidated cash flow 

statement on page 76. 

Dividends 

Dividends payable are recognised as a liability in the accounting 

period they are approved by the company’s shareholders. 

Share based payments 

Equity settled share based incentives are provided to employees under 

the Hyder Consulting PLC executive Share Option Scheme 2002 and the 

Hyder Consulting PLC 2006 Long Term Incentive Plan. Equity settled 

share based payments are measured at fair value at the date of grant. 

The fair value determined at the grant date is expensed on a straight 

line basis over the vesting period, based on the group’s estimate of 

shares that will eventually vest. 

Fair value for options with non-market performance conditions is 

measured by using the Black Scholes option pricing model which 

the directors believe to be the most suitable calculation technique. 

The expected life used in the model is based on management’s best 

estimate taking account of employees’ behaviour. Options with 

market-related performance conditions are measured using the Monte 

Carlo model. 

Investments 

Long term investments held as fixed assets are stated at cost less 

amounts written off or provided to reflect impairment. Those held as 

current assets are stated at the lower of cost and net realisable value. 

Impairment 

Fixed asset investments are reviewed where there is an indication of 

impairment to determine whether the carrying value of the assets 

may be irrecoverable. If any such indication exists, the recoverable 

amount of the asset is calculated as the greater of value in use or fair 

value less costs to sell, where the value in use is calculated as the 

present value of future cash flows resulting from the asset’s continued 

use and eventual disposal. This value is compared to the carrying 

value of the asset with any resultant loss recorded as a charge in the 

income statement. 

Foreign currencies 

All exchange gains or losses on settlement or translation at closing 

rates of exchange of current monetary assets and liabilities are 

included in the determination of profit for the year. 

Borrowing costs 

All loans and borrowings are initially recognised at cost being the net 

fair value of the consideration received plus transaction costs that 

are directly attributable to the issue of the borrowing. After initial 

recognition, interest bearing loans and borrowings are subsequently 

measured at amortised cost using the effective interest method. Fees 

paid on the establishment of loan facilities have been capitalised as a 

prepayment and amortised to the extent that there is no evidence that 

it is probable that some or all of the facility will be drawn down. The 

fees are amortised over the period of the facility to which it relates. 

Tangible assets 

Tangible fixed assets within the balance sheet are carried at historical 

cost less accumulated depreciation. Depreciation is calculated so 

as to write off the cost less the estimated residual value including 

estimated selling costs, over the expected useful life on a straight line 

basis as follows: 


Financial instruments 

- 5 years 

The company is exposed to a variety of financial risks, such as 

liquidity, foreign exchange and interest rate risks. A risk management 

programme is in place that seeks to limit the adverse effect of these 

risk factors on the financial performance of the company. Where 

appropriate the company enters into interest rate and currency 

instruments in order to hedge against the effects of future interest and 

exchange rate fluctuations, in line with the company’s treasury policy. 

Hedges are classified as follows: 

Fair value hedges 

Cash flow hedges 

- instruments that mitigate exposure to 

changes in the fair value of recognised assets 

or liabilities 

- instruments that mitigate exposure to cash 

flow fluctuations from a risk associated 

to recognised assets or liabilities, or for a 

forecast transaction 

The gains generated on foreign currency options are recognised on 

maturity of the underlying transaction in the profit and loss account. 

Foreign currency options that generate a loss lapse with no additional 

charge to the company’s profit and loss account. 

Any gains or losses arising from fluctuations in the fair value of 

derivative financial instruments are recognised immediately in the 

profit and loss account. 

The fair value of interest rate and foreign currency hedges are based 

on the market price of comparable financial instruments at the balance 

sheet date. The fair value of short term deposits, loans and bank 

overdrafts with a maturity of less than one year have been assumed to 

approximate to their book value. 

Deferred tax 

Deferred tax is provided on an undiscounted basis on all timing 

differences that have originated but not reversed at the balance sheet 

date except as referred to below. Amounts provided are calculated 

with reference to tax rates that are expected to apply in the periods 

in which the timing differences are expected to reverse, based on tax 

rates and laws that have been enacted or substantively enacted by the 

balance sheet date. 

Deferred tax assets are recognised only to the extent that it is considered 

more likely than not that there will be taxable profits from which the 

future reversal of the underlying timing differences can be deducted. 


1. Profit and loss account 

As permitted by Section 408 of the Companies Act 2006, the profit and loss account of the company has not been included in these Financial 

Statements. The retained profit for the year dealt with in the Financial Statements of the company was £243,000 (2011: £6,382,000). 

2. TANGIBLE ASSETS 

Computer software 2012 2011 

£’000 £’000 


At 1 April - - 

Additions at cost 6 - 

At 31 March 6 - 

This asset is currently in the course of construction and as such no depreciation has been applied. 

3. INVESTMENTS 


Interests in subsidiary undertakings £’000 £’000 


At 1 April 14,676 14,676 

At 31 March 14,676 14,676 

4. debtors 


£’000 £’000 

Amounts falling due within one year: 

Amounts owed by group undertakings 23,112 23,888 

Prepayments and accrued income 277 2 

23,389 23,890 

Amounts owed by subsidiary undertakings include amounts related to financing the activities of Hyder Consulting PLC (group) and are repayable on 

demand. 

5. creditors 


£’000 £’000 

Amounts falling due within one year: 

Amounts owed to group undertakings 353 151 

Other creditors 306 293 

659 444 


6. Called up share capital 

Issued and fully paid 

Shares £’000 

At 1 April 2010 38,370,320 3,837 


At 31 March 2011 38,540,280 3,854 


At 31 March 2012 38,634,530 3,863 

During the year, options were exercised on 7,000 shares at 87.5p, 21,000 shares at 139.5p, 25,000 shares at 194.0p, 15,000 shares at 256.3p, 5,000 

shares at 254.8p and 21,250 shares at 348.5p. The total consideration for these shares was £0.2m. 

7. Share premium account 

£’000 

Issued and fully paid: 

At 1 April 2010 29,281 

Premium on ordinary shares issued during the year less expenses of issues 308 

At 31 March 2011 29,589 

Premium on ordinary shares issued during the year less expenses of issues 200 

At 31 March 2012 29,789 

8. Other reserves 

Capital 

redemption 

reserve Own Shares Total 

£’000 £’000 £’000 

At 1 April 2011 80 (1,502) (1,422) 

Purchase of own shares - (361) (361) 

Transfer of own shares from EBT - 19 19 

At 31 March 2012 80 (1,844) (1,764) 

Own shares represent 801,976 shares (2011: 710,719 shares) held in the Employee Benefit Trust (EBT) for use in satisfying obligations under the 

Long Term Incentive Plan (LTIP). As at 31 March 2012, the EBT had an agreement in place to waive dividends on all shares held. 


9. Profit and loss reserve 


£’000 £’000 

At 1 April 11,700 7,358 

Profit for the year 243 6,382 

Share based payments 660 414 

Transfer of own shares from EBT (19) (96) 

Dividends paid (3,027) (2,358) 

At 31 March 9,557 11,700 

10. directors and Employees 

(a) 

Staff costs 

There were no employees other than directors in the years ended 31 March 2012 and 31 March 2011. 

(b) Average monthly numbers of employees during the year (including directors) 


Number Number 

Administration 5 5 


11. Share Based Payments 

Share options 

Set out below are summaries of options granted under Hyder group schemes: 

As at 31 March 2012 




Scheme Award date (p) (p) employees March 2011 year year year March 2012 March 2012 

ESOS 19-Jun-03 87.5 35.5 4 32,000 - (7,000) (5,000) 20,000 20,000 

ESOS 03-Aug-04 139.5 57.1 14 70,000 - (21,000) (1,000) 48,000 48,000 

ESOS 10-Jun-05 194.0 76.4 11 115,000 - (25,000) - 90,000 90,000 

ESOS 30-Jun-06 256.3 99.1 16 135,000 - (15,000) - 120,000 120,000 

ESOS 03-Jul-06 254.8 98.9 - 5,000 - (5,000) - - - 

ESOS 15-Jun-07 525.0 139.0 3 17,500 - - (7,000) 10,500 10,500 

ESOS 18-Jul-08 348.5 71.0 15 127,500 - (21,250) (4,250) 102,000 102,000 

LTIP (A) 15-Jun-07 Nil 505.9 2 5,332 - - - 5,332 5,332 

LTIP (A) 18-Jul-08 Nil 337.7 3 28,000 - (6,289) (2,844) 18,867 18,867 

LTIP (A) 19-Jun-09 Nil 139.8 17 203,534 - - (6,756) 196,778 - 

LTIP (A) 16-Jun-10 Nil 277.5 21 176,058 - (2,454) (3,111) 170,493 - 

LTIP (A) 15-Jun-11 Nil 381.0 29 - 167,844 - - 167,844 - 

LTIP (B) 11-Dec-08 Nil 150.7 2 494,522 - - (150,807) 343,715 343,715 

LTIP (B) 19-Jun-09 Nil 139.8 2 72,071 - - - 72,071 - 

LTIP (B) 16-Jun-10 Nil 241.8 2 171,185 - - - 171,185 - 

LTIP (B) 15-Jun-11 Nil 253.0 2 - 134,033 - - 134,033 - 

1,652,702 301,877 (102,993) (180,768) 1,670,818 758,414 


The group recognised total expenses of £0.7m related to share based payment transactions (2011: £0.4m). 

The weighted average outstanding period until expiry on outstanding awards at 31 March 2012 is 6.94 years. 


11. Share Based Payments continued 

As at 31 March 2011 




Scheme Award date (p) (p) employees March 2010 year year year March 2011 March 2011 

ESOS 19-Jun-03 87.5 35.5 7 49,400 - (17,400) - 32,000 32,000 

ESOS 03-Aug-04 139.5 57.1 22 112,000 - (42,000) - 70,000 70,000 

ESOS 10-Jun-05 194.0 76.4 14 175,000 - (60,000) - 115,000 115,000 

ESOS 30-Jun-06 256.3 99.1 18 195,000 - (45,000) (15,000) 135,000 135,000 

ESOS 03-Jul-06 254.8 98.9 1 5,000 - - - 5,000 5,000 

ESOS 15-Jun-07 525.0 139.0 5 115,500 - - (98,000) 17,500 17,500 

ESOS 18-Jul-08 348.5 71.0 20 182,750 - (5,560) (49,690) 127,500 - 

LTIP (A) 24-Aug-06 Nil 302.4 - 22,893 - (22,892) - - - 

LTIP (A) 15-Jun-07 Nil 505.9 2 35,916 - (13,380) (17,204) 5,332 5,332 

LTIP (A) 18-Jul-08 Nil 337.7 4 55,500 - (12,500) (15,000) 28,000 - 

LTIP (A) 19-Jun-09 Nil 139.8 18 255,629 - (2,267) (49,828) 203,534 - 

LTIP (A) 16-Jun-10 Nil 277.5 23 - 180,661 - (4,603) 176,058 481 

LTIP (B) 11-Dec-08 Nil 150.7 2 494,522 - - - 494,522 - 

LTIP (B) 19-Jun-09 Nil 139.8 2 72,071 - - - 72,071 - 

LTIP (B) 16-Jun-10 Nil 241.8 2 - 171,185 - - 171,185 - 

1,771,181 351,846 (220,999) (249,325) 1,652,702 380,313 


No options expired during the periods covered by the above tables. 

The fair value of share options with non-market performance conditions has been calculated using the Black Scholes option pricing model. The fair 

value of options with market-related performance conditions are measured using the Monte Carlo model. Expected volatility was determined by 

calculating the historical volatility of the group’s share price over a period prior to grant date equal in length to the vesting period, which equates 

to a three-year share price history (2011: three-year share price history). The risk free rate of return was assumed to be the yield to maturity on a 

UK gilt strip with the term to maturity equal to the expected life of the option. The expected dividend yield is an estimate of the dividend yield 

at the date of grant for the duration of the option’s life. 

The assumptions used in the valuation model are as follows: 

LTIP - LTIP - 

EPS conditions TSR conditions 

Jun 11 Jun 11 

Risk free rate of return 1.31% 1.30% 

Dividend yield 1.92% 2.00% 

Share price volatility 68.82% - 

Peer group volatility - 50.00% 

Vesting period 3 years 3 years 

Expected life 7 years 7 years 

Share price at grant date 403.6p 410.0p 


Non-Statutory Information - Summary of Five Year Trading Results (Unaudited) 

The following information is illustrative only and does not form part of the Financial Statements. 

Consolidated income statement 

2012 2011 2010 2009 2008 

£’000 £’000 £’000 £’000 £’000 

Revenue 277,309 290,297 308,606 318,970 233,672 

Net revenue 241,769 251,373 266,922 269,903 196,907 

Adjusted operating profit 21,031 20,303 18,002 16,828 15,037 

Net finance income/(costs) 576 23 (1,710) (1,796) (667) 

Adjusted profit before tax 21,607 20,326 16,292 15,032 14,370 

Amortisation of acquired intangibles and acquisition costs (2,462) (2,147) (2,825) (3,241) (1,802) 

Exceptional items (1,499) - - (8,579) 180 

Profit before tax 17,646 18,179 13,467 3,212 12,748 

Adjusted net operating margin % 8.70 8.08 6.74 6.23 7.63 

Adjusted diluted earnings per share p 44.34 43.34 35.26 33.82 33.36 

Dividends per ordinary share p 9.00 7.75 6.00 4.50 3.00 

Consolidated balance sheet 

2012 2011 2010 2009 2008 

£’000 £’000 £’000 £’000 £’000 

Goodwill 36,082 30,485 31,242 33,082 31,649 

Intangible assets 7,045 8,585 10,989 13,646 13,803 

Property, plant and equipment 7,106 7,550 10,456 13,477 11,142 

Deferred tax assets 10,373 10,079 10,834 12,240 8,559 

Current assets 141,562 134,569 138,176 157,879 119,407 

202,168 191,268 201,697 230,324 184,560 

Current liabilities (76,008) (74,955) (82,093) (106,630) (71,781) 

Total assets less current liabilities 126,160 116,313 119,604 123,694 112,779 

Non-current liabilities (38,888) (34,947) (51,985) (64,844) (63,045) 

Net assets 87,272 81,366 67,619 58,850 49,734 

Net cash/(debt) £’000 15,643 13,096 3,633 (5,729) (11,125) 

Average number of employees 3,671 3,859 4,360 4,912 4,257 


www.hyderconsulting.com 

Registered Office: 

29 Bressenden Place 

London SW1E 5DZ 

United Kingdom

Hyder Consulting PLC Annual Report 2012

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?