View - Atkins

18 Reviews
Operating and Financial Review
Overview of the business and performance in the year
Atkins provides professional design
and engineering consultancy services.
We are the largest engineering
consultancy in the UK and the fifth
largest design firm in the world.
Our business
Our core business is helping our clients
to plan, design and enable their capital
programmes that resolve challenges in the
built and natural environment. We are able
to plan all aspects of our clients’ projects,
conducting feasibility studies and impact
analyses covering technical, logistical, legal,
environmental and financial considerations.
We design systems, infrastructures,
processes, buildings and civil structures.
We enable our clients’ complex programmes
by optimising procurement methods and
managing supply chains on their behalf
to reduce timescales, cost and risk.
The Group’s operations and customers are
primarily UK-based with 78% of revenue
being derived from UK operations
(2007: 81%). In the year to 31 March 2008
our UK revenue grew by 8%. Our most
significant businesses outside the UK are
in the Middle East, China and the United
States and revenue from our non-UK
operations grew by 27% in the year, driven
by strong growth in the Middle East.
We report our activities in six business
segments as this reflects how we manage
the business via different markets and
geographies where appropriate. An overview
is shown on pages 4 and 5. Details of
activities and results by business segment
are shown opposite.
Review of the year
Key performance indicators
The Group uses a range of performance
measures to monitor and manage the
business. Those that are particularly
important in monitoring our progress in
generating shareholder value are considered
key performance indicators (KPIs). Our KPIs
measure past performance and also provide
information to allow us to manage the
business into the future. Revenue, operating
profit and margin, earnings per share (EPS)
and operating cash flow indicate the volume
of work we have done, its profitability and
the efficiency with which we have turned
operating profits into cash; work in hand
measures our secured workload as a
percentage of the budgeted revenue for the
next year; staff numbers and staff turnover
are measures of capacity and show us how
effective we have been in recruiting and
retaining our key resource. KPIs for 2008
are shown in the table opposite, along
with prior year comparatives.
In the year ended 31 March 2008 the Group’s
revenue from continuing operations grew
by 11% to £1,313.6m. Operating profit
from continuing operations increased
by 28% to £86.7m while the Group’s
underlying operating margins grew to 6.6%.
Operating cash flow in the year was £80.9m,
representing 93% of operating profit, and
net funds at 31 March 2008 were £168.4m.
Normalised diluted EPS grew by 10.2p per
share to 66.7p, an increase of 18%.
At 31 March 2008 we had secured 55% of
budgeted revenue for 2008/09, compared
with 58% last year. Work secured since the
year end has been ahead of expectations.
Staff numbers in continuing operations
increased by 1,400 (9%) with the majority
of this growth outside the UK.
Segmental analysis of revenue, operating
profit, work in hand and staff numbers
follows, while staff turnover is discussed
further in the Human Resources Review
section on pages 14 to 17.
WS Atkins plc Annual Report 2008