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Mouchel reports mixed results for the year

Consulting and busines services group Mouchel has reported a revenue growth of 13% to £740.6M and a rise in profits before tax and exceptional items of 3% to £40.1M.

Mouchel has also seen its win rate for the second half of the year has restored to within its target range of one-in-three to two-in-five of the opportunities tendered by value. The figures were reported in the preliminary results for the year ending 31 July 2009, published today.

The “exceptional items” include significant restructuring and asset impairment charges totalling £50M that arose as a result of restructuring the Group’s activities in the Middle East, management consulting and rail.

Chief Executive Richard Cuthbert called the year “difficult and disappointing”, but said: “We remain confident about our long-term prospects.”

“The impact of the economic downturn on our Middle East and management consulting businesses have clouded what has otherwise been another year of growth and strong performance in our core business.”

Richard Cuthbert, Mouchel

“In the second half we have had to deal with the substantial withdrawal from the rail market, together with the impact of the economic downturn on our Middle East and management consulting businesses. These have clouded what has otherwise been another year of growth and strong performance in our core business,” he said.

Cuthbert said the economic outlook was still a challenging one, but that it brought opportunity as well as uncertainty.

“Our focus on the transformation of essential services and the maintenance of vital infrastructure means that we will continue to benefit from sustained levels of public expenditure in our core markets,” he said, “and from the inevitable trend for increased outsourcing, signs of which we are already seeing.”

Mouchel continues to have a strong forward order book and bidding pipeline of £1.9billion and £2.2 billion, respectively. It reported that its core business is continuing to perform strongly, including good progress in extending major local authority partnership contracts.

Financial highlights

 20092008
Revenue£740.6M£656.7M
Underlying operating profit¹£47.3M£41.7M
Underlying operating margins¹6.4%6.4%
Profit before tax and exceptional items£40.1M£38.8M
Exceptional items (net)£(53.6)M£(12.5)M
(Loss)/profit before tax£(13.5)M£26.3M
Adjusted earnings per share¹,²26.4p25.7p
Basic (loss)/earnings per share(11.7)p17.9p
Dividend per share³6.10p6.10p

1 Underlying operating profit, underlying operating margins and adjusted earnings per share exclude those items which the Group presents as exceptional items in the accounts (including the annual amortisation of intangible assets arising from business combinations) - see note 3 for full details. 

2 Adjusted earnings per share is calculated after adding back shares held by the employee share trusts to the weighted average number of shares and adjusting earnings for exceptional items (net of taxation).

3 Includes paid and proposed dividends in respect of the year.

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