Accounting and consulting giant EY has for the first time in its history broken through the revenue barrier of £2 billion in the UK. The growth follows strong performance across all service lines and regions, with distributable profits increasing by 6% from £412 million to £437 million.
With 212,000 professionals based 700+ offices in more than 150 countries, EY is one of the four largest accounting and consulting firms of the globe. Last week the services giant revealed that it had globally booked its best performance since 2008, growing its revenues by 11.6% to $28.7 billion. Growth was booked in all four geographic areas, as well as all four service lines, with Advisory again the strongest performer.
The UK organisation, which belongs to one of EY’s five largest practices, provided a strong contribution to global growth. In its last financial year, the year ending 3 July 2015, EY UK saw its fee income grow by 8% to £2.010 billion, up from £1.868 billion in the previous year. Similar to global performance, EY UK expanded all of its four service lines. Assurance grew by 6.4% to £585 million, driven by several large wins in the audit domain, including The Co-operative Bank, BBC, London Stock Exchange, Sainsbury’s and Sage. The firm also saw strong demand for broader assurance services, including financial accounting and forensic services, which both grew by over 20%.
The Advisory business grew by 4.5% to £584 million with good growth from infrastructure, local public services, telecommunications, media, technology and life sciences. Advisory growth also includes the effect of acquisitions encompassing UK operations, including strategy consultancy The Parthenon Group and GRC expert Integrc. Transaction Advisory Services (TAS) grew by 12.1% to £324 million with strong performances throughout the year for all parts of its business, driven by the improving appetite for mergers and acquisitions. Tax grew by 10% to £517 million with all areas of the business growing strongly in a year that saw good progress across all of the UK and a strong market for tax work on private equity and corporate transactions.
Despite the higher revenues, distributable profit per partner dropped 3.7% to £700,000, the result of a number of large investments, including increased learning & development expenses, the refurbishment of the majority of its 21 offices – including the opening of a new office in Canary Wharf – and investment in enhanced technology.
Over the past financial year, EY UK recruited over 4,500 people, including 1,275 graduates, 609 undergraduates and 110 school leavers. A record 95 new equity partners, 30% of whom were women and 11% Black and Minority Ethnic (BME), were also admitted to the partnership. “I am very proud of the jobs that we have created this year, especially as we continue to provide more opportunities for school leavers as well as experienced hires and new graduates,” says Steve Varley, EY’s UK Chairman. He adds: “We have recruited over 4,500 people to fuel our growth and we plan to continue this level of investment as part of our ongoing global growth strategy.” Globally the firm welcomed 23,000 new professionals in FY15, and in July EY promoted 753 partners, of which almost one third are women.
Looking ahead, Varley says he feels very positive about the health of the UK economy, stating “improved market conditions have provided us with a great platform to further accelerate our investment in the business. We are seeing an increased demand from our clients for our services to help them drive growth and trade in both the UK and internationally.” Varley in addition points at the positive leverage the firm is getting from its global operations: “Our global strength continues to give us significant competitive advantage when combined with our deep local connections across the 21 offices in the UK.”
Last week Consultancy.uk also featured the performance of EY Netherlands, which saw its revenues grow 5% to €710 million.