ATK.L Regulatory News (ATK)

Atkins trading in line with expectations

WS Atkins plc ("Atkins" or the "Group"), the design, engineering and project management consultancy, today provides its first quarter trading update for the period from 1 April 2016 to date.

Group performance

The Group has traded in line with expectations through the first quarter and we remain confident for the year ahead, despite continued uncertainty in some of our markets.

United Kingdom and Europe

In the UK we have had a good start to the new financial year. In the quarter we secured some strategically important projects in cyber security and defence, together with major frameworks in transportation and water. At the beginning of April we took a further step to simplify our organisational structure, as we combined our design and engineering and water, ground and environment business units into a new infrastructure division, which will enhance our ability to cross-sell our capabilities.

While the result of the EU referendum has obviously created some uncertainty in the market, to date we have not experienced any immediate impact. Benefiting from a very diversified business in the region, we continue to monitor activity levels closely across our various markets.

North America

Our North American business has also enjoyed a good start to the new financial year. We have now begun to mobilise resources on the Purple Line light rail project in Maryland, and we are working on project NEON, our transportation project for the Nevada Department of Transportation. While we do not expect to see a significant impact from the five-year Transportation Bill until after the presidential election in November, our work on these two major projects will help us to deliver good volume growth and margin progression this year. 

Middle East

Our design work on Riyadh Metro in the Kingdom of Saudi Arabia and the Doha Metro Gold Line and Red Line South in Qatar has continued into the new financial year. While we were pleased to secure a number of contracts in the property market during the period, the transport and infrastructure markets have been more challenging and we have experienced a number of award delays. As a consequence, we have adjusted our resources in the period to match the anticipated workload.

Cash collection remains a key focus across the region and we continue to monitor the liquidity situation closely.

Asia Pacific

Our Asia Pacific business has traded in line with our expectations during the period and we were particularly pleased to secure the airfield facilities design consultancy for Hong Kong airport. We have seen some early signs of an improvement in the property market in mainland China, although we remain cautious as to whether this improvement will be sustained.

Our strategy of geographic diversification continues, supported further by our new Acuity business which is focused on opportunities in both South East Asia and the Middle East.

Energy

The trading environment for our oil and gas businesses in the UK and North America remains very challenging and we have taken further steps to respond. By contrast, our Middle East oil and gas business has continued to trade well in the period.

We welcome the final investment decision on Hinkley Point last week, and look forward to a positive outcome from the Government's review in the autumn. Elsewhere in our nuclear business, the integration of the PP&T acquisition, which completed on 11 April 2016, is progressing well.

Balance sheet

Despite the normal seasonal working capital outflow and the acquisition of PP&T, the Group's financial position remains strong with net borrowings at the end of June of around £50m (March 2016: net funds of £191.7m).

Outlook

The Group has traded in line with expectations through the first quarter and we remain confident for the year ahead, despite continued uncertainty in some of our markets.

Ends

Enquiries

1. Notes to editors

Atkins (www.atkinsglobal.com) is one of the world's most respected design, engineering and project management consultancies, employing some 18,000 people across the UK, North America, Middle East, Asia Pacific and Europe. We build long term trusted partnerships to create a world where lives are enriched through the implementation of our ideas. You can view Atkins' recent projects on our website.

2. Analyst Conference Call

A conference call for analysts will be held at 0800 hours today. Dial-in details are available on +44 (0) 20 7121 2693.

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 announcement 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.