Arcadis has released its first quarter trading update saying net revenue of £500M is down 4% on the same period last year mainly due to the recession in Brazil.
A drop in EBITA of 9% to £668M is also put down to Brazil. In contract, the EBITA of the UK, Europe, Asia and Australia are slightly up on last year. In the UK figures were boosted by the integration of Hyder. However it said in the building sector revenues decreased due to a slowdown in the London market, related to investor uncertainty related to a potential Brexit.
Arcadis chief executive Neil McArthur said: “As expected, we experienced tough conditions in emerging markets and for our business in North America, as it goes through its transformation. The deep recession in Brazil drove revenues lower and impacted our overall results. In North America, we saw increased competition with related price pressure, especially in the Environment business. Our transformation program in North America to improve growth and to increase profitability is ongoing. In the UK, Continental Europe, Asia and Australia our results were an improvement on last year. In the Middle-East, despite market headwinds, our EBITA results were close to Q1 2015. The increase in backlog demonstrates our ability to commercialize our value propositions and represents eleven months work.
”Actions taken to improve working capital resulted in a significant improvement compared to the first quarter last year and we will continue to focus on a strong free cash flow. Our leadership teams remain agile in taking measures to be competitive, including capturing growth opportunities, delivering our Performance Excellence program and integration synergies.”