Hyder posts sharp fall in profit after £11.2m writedown

Hyder has reported a 77% fall in full-year pre-tax profit after writing down £11.2m on the value of its Asian and German businesses.

The consultant posted pre-tax profit of £5.4m in the year to 31 March 2014, down from £16.6m the previous year, while revenue declined marginally to £296.8m, from £298.1m.

Hyder said its results “were affected by delays in new contract awards in Australia due to the election and the poor year in Germany.”

But Hyder said the performance of its UK and Middle East divisions “continues to be strong”, with UK adjusted operating profit doubling to £6.8m, up from £3.4m, while revenue grew 17% to £88.1m, up from £75.5m.

The firm’s Middle East division reported adjusted operating profit up 8% to £7.7m, up from £7.1m, while revenue grew 17% to £88.3m, up from £75.2m.

The firm made a £6.7m writedown on the value of its German business – incorporating the cost of closing three offices in the country – and a £4.4m writedown on the value of its Asian business.

The German business also reported an adjusted operating loss of £1.7m, compared to a £1.4m profit the year before, while revenue declined 20% to £20.8m, down from £24.5m.

The Asian business returned to an adjusted operating profit of £0.4m, compared to a £1.2m loss the previous year, while revenue increased 7% to £88.3m, up from £75.2m.

The Australian business reported a 47% drop in adjusted operating profit to £8.6m, down from £16.1m, while revenue declined 25% to £77.3m, down from £102.6m.

Hyder’s overall order book grew 7% to £440m and the firm’s headcount grew 12% to 4,500.

Hyder said the results met its revised expectations and the firm’s outlook for the current financial year “remains unchanged”.

The firm added: “We expect another good year in the Middle East and in the UK. We have a good pipeline of bidding opportunities in Australia, and expect further progress in Asia.

“We believe that the restructuring and management changes we have made in Germany will restore the region to profitability.

“Our order book is at a record level, and this gives us confidence in our longer term prospects.”

Alan Thomas, chairman, said: “Although group results for the year are below our original expectations, trading in the UK and the Middle East continues to be strong. This highlights the value of our technical skill base and a regionally balanced business.”