BDO HAS ANNOUNCED DOUBLE-DIGIT growth in profits in its annual results.
The firm, which saw new managing partner Paul Eagland take position on Monday, exceeded revenues of £405m, up 3.8% from last year (£390m) – alongside a 22% profit hike.
Paul Eagland, managing partner at BDO, said: “The results are testament to our partners and people who have worked diligently and passionately helping our clients. The increase in profits reflects a return on the firm’s investment and ongoing focus on sustainable, profitable growth.”
BDO’s profits grew 22% to £80.3m compared to £65.6m last year. As a result, average profits per equity partner (PEP) increased by 29% to £360k. BDO’s audit revenues increased by 8.3% to £143m compared with £132m. BDO has made more than 500 promotions in the last year and saw 700 trainees move up the ranks.
The firm’s tax business posted revenues of £126m compared to £119m last year. BDO’s advisory revenues held steady at £136m. Its business recovery, forensic, valuations, tax investigations and global outsourcing business areas have all performed well. For the fifth year running, BDO is the leading reporting accountant for AIM IPOs.
Eagland, added: “The ambitious and high-growth businesses we work with – many of which are in the mid-market, AIM-listed or PE-backed – have continued to succeed despite uncertainty in global markets, the EU referendum and government changes at home. This has created opportunities for both BDO and our entrepreneurially-spirited clients.”
New hand on the tiller
Last week, Simon Michaels stepped down from his role as managing partner after completing the maximum two four-year terms in position. Under his leadership, the firm completed the first proactive strategic merger in the accountancy market for more than a decade when BDO merged with PKF in 2013.
Eagland stepped up to the managing partner position on 1 October after almost 30 years at BDO. A key member of BDO’s leadership team for the last eight years, Paul has held a number of senior roles in the business. BDO is set to recruit 25 new partners to the business in the next 12 months.
Eagland, commented: “Simon has not only steered the firm through a turbulent eight years of domestic and global uncertainty, but he steps down as managing partner having grown a values-led, sustainably profitable business with a strong balance sheet. This will support continued targeted investment, our focus will be on helping people and businesses succeed.”
The development of global web-based audit tool, BDO Advantage – a data analytics tool – and its UK cloud accounting service BDO InTouch, which launched last year, has already expanded into Australia, New Zealand, South Africa. The firm has recently also announced a worldwide strategic alliance with Microsoft.
Eagland, added: “The people we attract and the technology we deploy is changing the face of accountancy at rapid speed. We are investing heavily in these advances to add even more value to our clients, but importantly we’re doing them in areas and market segments we understand and believe in.”
BDO works for a third of FTSE 350 companies in an advisory capacity but remains committed to its mid-market, private equity, AIM-listed, high-growth heartland. Globally, BDO’s international network grew by nearly 13% through both organic and acquisitive growth, reporting revenues of $7.3bn and employing 64,500 people across 154 countries.
Eagland concluded: “Developments in technology and regulation, an uncertain relationship with the EU and the increasing pace of globalisation means that many of the boundaries that once governed the way organisations do business are changing or disappearing altogether. There are exciting times ahead and we look forward to helping our clients navigate new and unfamiliar territory.”
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Dennis Layton takes up the position on April 1 and will contribute to the firm’s goal of becoming the leading global professional services organisation by 2020
Richard Cartwright becomes the new head, taking over from incumbent head of office David Lemon
Brian Burke, business development director, has moved within the firm to 'develop Quantuma’s networks with Sussex professional firms'