ATK.L Regulatory News (ATK)

Pre-Close Trading Update

WS Atkins plc ("Atkins" or the "Group"), the design, engineering and project management consultancy group, today provides an update on trading for the year ended 31 March 2013 in advance of its preliminary results announcement on 13 June 2013.

Overall, we have traded well through the fourth quarter and expect to report results for the year ended 31 March 2013 slightly ahead of market expectations.

We are pleased to report that the positive momentum in our UK business has been maintained. Headcount has continued to grow and we expect to report an improved margin in the second half. As we communicated at our recent analyst presentation we see a number of future growth opportunities in the UK including electrification of the rail network, airport development and aerospace.

We are making good progress to close out the disposal of our UK highways services business, announced on 28 February. Some 1,200 people will transfer across to Skanska on completion, which is due by 31 May. We expect to incur exceptional transaction fees and restructuring costs of around £4m in this financial year as we realign our overhead base to reflect the removal of this business. These costs will be more than offset by a profit on sale of around £15 million that will be reported on completion of the transaction in the next financial year.

Our North American consultancy business continues to experience soft market conditions, with an increasing requirement from clients for us to subcontract services which dilutes our reported margin. However, as previously noted, we still anticipate a better margin performance in the second half. In addition, recent toll-road project wins in our highways and transportation business in Florida and Texas demonstrate our strong reputation and position in these key markets.

As a result of additional costs in closing out its legacy contracts, Peter Brown, our construction management at risk business, is now expected to report a loss of around £6m for the year.

As previously highlighted, protracted negotiations continue in the Middle East on a number of outstanding contract variations. These issues have impacted our financial performance in the region in terms of both profitability and cash flow. However, we believe this market continues to offer significant project opportunities for us going forward.

The strong first half performance of our Asia Pacific and Europe business has been maintained through the second half and Asia Pacific remains a focus area for investment by the Group going forward.

Investment in growth also continues in our Energy business, with good prospects for our oil and gas and nuclear businesses in particular. Headcount in this business continues to grow, reflecting an increasing pipeline of opportunities. In particular, we are pleased to have been appointed to the strategic supply chain partnership for EDF Energy's nuclear business as it seeks to extend the life of its existing nuclear fleet.

Following a very strong cash performance in the second half we have increased our expectations for net funds at 31 March 2013 to around £140m.

Outlook

We have made good progress against our strategic priorities in the second half of this financial year. We will continue to vigorously pursue the implementation of our strategic objectives going forward.

Ends

Enquiries

Notes to editors

1. Atkins

Atkins (www.atkinsglobal.com) is one of the world's leading design, engineering and project management consultancies*, employing some 17,700 people across the UK, North America, Middle East, Asia Pacific and Europe. It has the breadth and depth of expertise to plan, design and enable some of the world's most technically challenging and time critical infrastructure projects.

*14th largest global design firm (Engineering News-Record 2012) and the third largest multidisciplinary consultancy in Europe (Svensk Teknik och Design 2012).

2. Analyst Conference Call

A conference call for analysts will be held at 0800 hours today. Dial-in details are available from Smithfield on +44 (0) 207 360 4900.

3. Cautionary Statement

This announcement has been prepared for the shareholders of Atkins as a whole and its sole purpose and use is to assist shareholders to exercise their governance rights. In particular, this news release has not been audited or otherwise independently verified and no warranty is given as to its accuracy or completeness (other than any such warranty which is mandatorily implied by statute). Atkins and its directors and employees are not responsible for any other purpose or use or to any other person in relation to this announcement and their responsibility to shareholders shall be limited to that which is imposed by statute.

This announcement contains indications of likely future developments and other forward looking statements that are subject to risk factors associated with, among other things, the economic and business circumstances occurring from time to time in the countries, sectors and business segments in which the Group operates. These and other factors could adversely affect the Group's results, strategy and prospects. Forward looking statements involve risks, uncertainties and assumptions. They relate to events and/or depend on circumstances in the future which could cause actual results and outcomes to differ materially from those currently expected. No obligation is assumed to update any forward looking statements, whether as a result of new information, future events or otherwise.