PwC partners see profits fall
Annuity payouts to former partners eat into distributable profits
PARTNERS AT PwC saw their average take-home pay fall to £679,000 in 2012, from £707,000 a year earlier.
Despite strong revenues, with the firm growing 7% to £2.6bn for y/e 30 June 2012, annuity distributions to former partners took out of the pot, available to current partners.
Total profit for the financial year was £727m, from £656m a year earlier. Average profit per partner prior to other distributions was £798,000, from £763,000 a year earlier.
The firm’s members paid £975m in tax during the financial year, compared to £900m a year earlier.
Staff costs increased 6% to £1.14bn, which reflects an increased headcount of 3%. Bonuses across the group fell 6% to £84m including National Insurance.
The firm’s total defined benefit pension scheme has leaped to £79m from £4m a year earlier, following a reduction in the discount rate used to value liabilities, which was partially offset by cash contributions and asset returns in the financial year. Some £74m was paid into the firm’s defined benefit pension schemes during the year, with a further £41m due over the next four years.
“We delivered strong performance across all of our businesses over the past year in what remains a very challenging market,” said PwC chairman Ian Powell (pictured).
“We took a decision at the start of the downturn to continue to hold our nerve and invest in our business.
“We have recruited significant numbers of new people, and invested heavily in our infrastructure to make sure we deliver a world-class service to our clients. This has included the recruitment of some 2,300 people, including 1,200 graduates and 100 school leavers, the admission of 61 new partners, a net 3% increase, and a number of strategic acquisitions.”
The firm’s assurance division grew 6% to £963m, helped by audit wins including Aviva, Dubai World, Genel Energy and Yule Catto. Consulting grew 13% to £438m. The deals practice reported 8% growth to £561m, while tax grew 2% to £659m.
It provided 3,454 hours of free technical support to political parties during the year, from 3,7000 a year earlier. The value of this work was £400,000, to the Labour Party (3,454 hours) and Lib Dems (832 hours).
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Powell’s take-home pay remained the same in 2012 at £3.4m.