PwC Turnover up 6% but Profits Flat
PwC’s turnover rose by 6% last year on a slim increase in profits, and the firm is building headcount in a bid to boost its market share.
The firm’s turnover grew to £2.46bn for the year ended 30 June 2011, up from £2.33bn in the previous year. Total pre-tax profits were £656m, compared with £624m, with £622m available for division among partners, the same amount as the year before.
The average profit per partner rose marginally to £763,000 compared to £759,000 last year, while the bonus pool paid to staff in the UK climbed by 10% to £89m. Overall staff costs were up by 6%.
PwC reported strongest growth from overseas. The UK firm turnover rose 4% to £2.28bn, while turnover from non-UK subsidiary undertakings in the Middle East and Channel Islands increased by 30% to £180m.
PwC says 14% of the UK firm’s turnover was for work performed and billed to clients outside the UK. The proportion of turnover from non-audit clients remained unchanged at 58% this year, compared with 57% previously.
PwC’s assurance business, which won the Aviva, TUI and IG Holdings audits during the year, grew by 6% to £909m. The advisory business was up 8% to £907m, but the tax practice saw only a 2% increase to £645m.
The firm reported strong demand in the financial services sector driven by a combination of new legislation and regulation and a significant amount of restructuring and reorganisation within the industry. Turnover from work with financial services clients rose to £949m for the year, compared with £803m in 2010.
Ian Powell, PwC UK chairman and senior partner, said: ‘I am pleased to report a strong performance in a period of volatile financial markets, fragile economic confidence and the tightening of public expenditure.'
In an interview with the Times, Powell said the firm is creating 600 new jobs on top of its 1,200 annual graduate intake starting work this week. PwC also received a record 33,000 applications from school leavers this year.
‘It is very, very competitive, so if we’re going to achieve the growth rates we’ve been budgeting for, we’ve got to take market share,’ Powell told the paper.