STRONG PERFORMANCE in EY UK’s advisory arm – fuelled by a resurgence in private equity and IPO activity – helped deliver a surge in partner profits for Big Four firm EY.
Its latest figures for the year ending 27 June 2014 showed turnover up 8.6% to £1.87bn while distributable profits jumped 12% to £412m. This was broadly in line with EY’s global revenues of US$27.4bn (£16.93bn) for the same period – up 6.8% in local-currency terms.
EY UK’s partners – up by 68 this year – saw their average distributable profit per partner increased by an inflation busting 11.7% to £727,000, up from £651,000 in 2013.
Steve Varley, EY’s UK chairman, said: “Critical to EY’s market-leading growth in the UK is our global strength together with deep local connections in each of our 21 offices in the UK. Our ability to collaborate internationally has given us significant competitive advantage in helping our clients expand across borders. Our commitment to a long-term investment strategy in the UK, especially through the recession, continues to pay off.
“Looking forward, even though there is a degree of political uncertainty in the UK, I do feel positive about the health of the economy and the opportunity this gives businesses to grow. At EY, our global strategy means we have exciting times ahead and I am confident that this strategy will help us help our clients grow in the UK and internationally.”
All four EY UK service lines grew with assurance delivering the highest returns – up by 8.5% to £550m, fuelled by the audit business, fraud probes and financial & accounting advisory services. Among its blue chip audit wins in the past year have been the BBC, the London Stock Exchange, Sage and the Co-operative Bank.
UK headcount was also up 9% by year-end, including over 750 graduates and 100 school leavers across its office network.
Transaction Advisory Services (TAS) saw a 5.9% surge to £289m, thanks to a ‘resurgence in private equity and a significant boost in IPO activity’. EY cornered the market and advised 40% of all IPOs in the last year. Tax revenues were swelled by 3.3% to £470m with a strong performance across all areas, particularly work on major M&A transactions.
Financial services, the firm’s largest industry sector, delivered its 6th straight year of strong growth. Other sectors highlighted by the firm solid growth included technology, media, telecoms and private equity.
The firm said it would be investing £20m over the next three years in its regional offices, including a £650,000 investment in a new technology hub in Manchester and the expansion of its Belfast office that will create around 500 new jobs.
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