Deloitte revenue grows 5.9 per cent to £3,580m

Deloitte has increased its revenue by 5.9 per cent in the financial year ended 31 May 2018, from £3,380m to £3,580m, marking the eighth consecutive year of revenue growth.

Across the firm’s service lines, Audit and Risk Advisory revenues grew by 10.2 per cent to £1,027m, Consulting increased by 1.7 per cent to £873m, and Tax saw its revenue rise by 5.8 per cent to £732m. Financial Advisory remained at £459m.

In 2018, distributable profit was £584m as the firm continued to invest profits in building new capabilities, such as an internal centre of excellence for robotic process automation and an artificial intelligence studio, as well as in training and development of our people and audit quality initiatives. Average profit per equity partner was £832,000.

In Scotland, Deloitte said it continues to evolve by expanding its footprint in new sectors including Fintech, recently demonstrating its commitment by promoting Edinburgh based Fintech specialist Kent Mackenzie to partner, and becoming Fintech Scotland’s professional services provider. Meanwhile Deloitte Digital in Edinburgh has more than trebled its size in 12 months and now boasts a team of 18 designers and software engineers with plans to grow further in the coming year.

Steve Williams, senior partner for Deloitte in Scotland and Northern Ireland, said: “We have experienced a particularly vibrant year by creating new partnerships and propositions which are helping our clients adapt to ever-changing market conditions, through embracing disruptive technologies.

“In particular, we have further invested in our full range of capabilities, with a real focus on supporting growth in the Oil & Gas sector across Scotland at this time of cautious optimism, being at the forefront of assisting our Financial Services clients embrace disruptive change across the sector, and working closely with the Public Sector to make a real difference to all the people of Scotland. At the same time we are absolutely committed through Deloitte Private to support the success of the private markets sector, which forms the bedrock of the Scottish economy.”

Pauline Biddle, managing partner for regional markets, said: “We have a truly enviable regional business with over 6,000 incredibly talented people led by 269 partners delivering outstanding work across our regions and countries1. Over the past two years the regions have led the way with an uptick in revenue, which is fantastic given the current economic backdrop.

“This growth sends a strong message to our clients that we have the skills and capabilities both in and outside of London to deliver world-class advice across all our service lines, no matter where their business is based.”

David Sproul, senior partner and chief executive of Deloitte North West Europe, said: “This is a good result in a market facing slower economic growth and continued uncertainty. Tax revenues have been boosted by demand for M&A, private client and employment-related services work, as well as demand for digital solutions to global compliance obligations, where we are continuing to invest. Following the launch of our UK legal services, we are also growing our offering in immigration, employment services, corporate dispute and resolutions, alongside a focus on ‘new law’ services.

“Financial Advisory advised on over 100 M&A deals with a total value in excess of £40bn, and on 50% of main market IPOs. We saw strong growth in Transaction Services, Portfolio Lending and Debt Advisory services, driven by the buoyancy of the M&A market, in addition to continuing growth in Financial Crime services.

“Our Risk Advisory business saw an increase in demand for cyber and regulatory advice, while Consulting was focused on reinforcing its leading position in delivering digital transformation programmes for clients. The business integrated new additions including creative agency Acne and proposition design consultancy Market Gravity into Deloitte Digital, whilst continuing to build its alliances in the market with Apple and McLaren Applied Technologies.

“The audit profession has faced significant scrutiny in the past year, with concerns raised over quality, conflicts of interest and a lack of choice. These are serious concerns and we recognise the need for change. We must look at how the audits of the future match the evolving needs of stakeholders and society and address increasing business complexity. We have continued to invest in training and technology to help our 4,300 audit professionals deliver the highest quality audits and are proud to audit 27 per cent of the FTSE 100.

David Sproul added: “From an innovation perspective, this was an exciting year as we developed an internal centre of excellence for robotic process automation as well as an artificial intelligence studio. Both will help businesses, as well as ourselves, improve efficiency and effectiveness at a lower cost.

“This year also saw the launch of Deloitte Ventures, an advisory service team working with a community of over 100 external start-ups to help businesses solve complex challenges. We’ve done this because emerging technologies are rewriting the rules and changing the way business is done, so we are co-creating and co-investing with leading corporations to build new partnerships, platforms and products.”

In the last financial year 5,000 people joined Deloitte, with nearly 2,000 of them based outside of London. Of the 5,000, over 1,700 were graduates and school-leavers, including 270 BrightStart apprentices, Deloitte’s programme for school-leavers.

The firm invested close to £40m in learning and development this year, and introduced new formal working arrangements, including annualised days contracts, as part of its agile working agenda. It also continued its mental health support initiatives.

Emma Codd, Deloitte’s managing partner for talent, said: “Since we introduced agile working, the number of formal agile workers has risen by around 30%, from around 850 people in 2014 to over 1,100 today, with 27% of women at or above senior manager level having such an arrangement. Our approach is underpinned by three simple principles – trust and respect; open and honest communication and judging solely on output.

“Deloitte has also continued its long-standing commitment to raising awareness of mental health issues. Working with Mental Health First Aid England, 530 of Deloitte’s senior leaders have completed training to spot the signs of poor mental health and signpost the support available to our people.”

Deloitte contributed £5.7 million to charities and social enterprises this year, whilst supporting over 340,000 people through the firm’s social impact strategy. In Scotland, the company supports Befriend A Child, Social Bite, Children 1st and Glasgow Children’s Hospital Charity.

Mr Sproul concluded: “We’re now over two years into our One Million Futures strategy, and almost halfway towards our target of supporting one million people to get to where they want to be through education and employment. Over a third of our people volunteered to support the programme.”