AIM-listed architecture practice Aukett Swanke Group has posted profit of £495,000 after tax for the six months to the end of March 2014
The pre-tax half-year profit of £750,000 compared to a £79,000 loss for the same period in 2013, and full-year profits of £550.000.
The group, which was formed after Aukett Fitzroy Robinson (AFR) paid £1.58million for fellow architectural big hitter Swanke Hayden Connell Europe last December (see below) has seen its revenue more than double to £7.57million - a rise from £3.4million in 2013.
The ‘higher than expected profits’ have been attributed to an improvement in market conditions in the UK which it said begun around 18 months ago and has gathered pace in recent months.
Aukett Swanke Group chief executive Nicholas Thompson said: ‘We are extremely pleased by a very strong performance in the UK coupled with improving performances in Continental Europe and the new Turkish operation, all of which offer good signs of progress from previous turnover levels.’
The UK sector had a particularly strong performance, posting pre-tax profits of £945,000 on revenues of £6.08m, up from £127,000 in 2013.
Previous story (AJ 19.12.13)
AFR snaps up Swanke Hayden Connell
AIM-listed architectural practice Aukett Fitzroy Robinson (AFR) has bought up fellow architectural big hitter Swanke Hayden Connell Europe (SHCE)
Earlier today the practice, which was ranked 66 in this year’s AJ100 rankings, snapped up the ‘entire issued share capital’ of SHCE to create a new 340-strong outfit which has been renamed Aukett Swanke.
The two companies will merge their London and Moscow studio to create a ‘significantly bigger’ company with an expected annual turnover of around £16million.
AFR paid £210,000 in cash and made a £1.37million share exchange for SHCE’s shares.
Although SHCE ‘has virtually no debt,’ the company made a pre-tax loss of £560,000 on revenue of £6.4million in the year to 31 December 2012.
However it has traded profitably during 2013 and the board of AFR ‘expects this to continue’ into 2014.
AFR’s chief executive Nicholas Thompson will remain in the top role, with SHCE’s chief executive David Hughes joining as deputy chairman and its principal interior design director Nick Pell becoming an executive director.
All UK based vendors who are employees of SHCE will remain employed within the enlarged Group.
Nicholas Thompson chief executive of Aukett Swanke
‘The first thing this [move] allows us to do is to become stronger in our existing markets. It has been very important to have a much stronger base, strengthening our UK offer. We now have 177 staff in this country UK. We also have offices in Moscow, Germany, the Czech Republic and Turkey and an emerging link in South America.
‘The deal has taken 18 months to complete [from when we were first introduced] and it has been about hearts and minds – effectively getting to know each other.
‘The most interesting thing was that even though AFR and Swanke Hayden Connell worked in similar geographic locations and similar markets we found we were very rarely competing for the same jobs. So this [tie-up] really has increased our market share.
‘As to the future our biggest push will be towards the east. We are already in Dubai where there are many unfinished projects or unrealised schemes which may need re-looking at.
‘And the Expo 2020 news is a major shot in the arm. An Expo really does mean building.’
‘In terms of emerging from recession we feel the new company is ahead of the curve. The old AFR started to recover about 18 months ago with the first wave of new enquiries. Now we are into the second wave of projects.
Two years ago we were working on virtually nothing outside London
‘Intriguingly we are seeing a lot of speculative office schemes outside of London, i.e. without pre-lets, from Birmingham southwards.
‘Two years ago we were working on virtually nothing outside London. But enquiries are now split 50:50 between London and the regions. That has been a big change and that has happened in the last three months.
‘This shows there is momentum in the market place and that there is light at the tunnel. However there is probably a year lag in the regions.’
Aukett Swanke jumps back into profit