EY revenue up 6%, driven by double digit Advisory growth

29 September 2014 Consultancy.uk

EY has performed strongly over the past year – the accounting and consulting firm realised global revenues of $27.4 billion, an increase of 6.0% compared to the previous fiscal year. All business units managed to grow, with Advisory the strongest performer.

Over the past decade, EY has, on the back of an internationalisation and professionalisation strategy, booked impressive growth. In 2004 the firm’s global revenue (then known as Ernst & Young) was approximately $14.5 billion, in its latest fiscal year revenue totaled $27.4 billion, which comes down to a CAGR of 6.6% for the 2004 - 2014 period. For its 2014 financial year, EY recorded a growth of 6.0%, slightly stronger than the 5.8% increase booked in the previous term. “I am very proud of our people’s efforts, which resulted in another strong year of growth for EY. This follows our market-leading performance last year,” says Mark Weinberger, EY’s Global CEO.

Global Revenue of EY

Consulting led the firm's results, growing much faster than its core audit business, as has been the case at all of the major professional services firms in recent years. EY’s Advisory business grew 13.5% to $6.5 billion, while the M&A business (Transactions Advisory Services) rose 6.6% to $2.3 billion. Tax grew 4.0%, while Assurance expanded with 3.0%. EY’s headcount currently stands at 190,000 people globally, an all-time high for the firm.

Looking at the performance since the outbreak of the crisis (2008 – 2014), then Advisory stands out as the best performing unit, growing with a staggering 71%. As a result, its share of EY’s total business has risen from 17% in FY08 to nearly a quarter this year.

Revenue Growth per Business Unit

Acquisitions
EY’s growth over the past year was realised through a combination of organic growth, built on the intake of 60,000 new hires globally, and inorganic growth, through 17 acquisitions. The Big 4 firm was particularly active in the consulting landscape, acquiring the likes of among others Greenwich Consulting (130 consultants), strategy consultancy The Parthenon Group (350 consultants), Net Balance, Sweeney Research and Corporate Quality Consulting, although the latter three firms have been purchased after EY’s fiscal year end (30 June 2014), meaning that their figures will be consolidated into the FY15 results.

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