AJ100 practice Broadway Malyan has blamed the fall in oil prices, the downturn in China and Brexit jitters for a 7.6 per cent fall in annual turnover
According to its latest accounts for the 12 months to 30 April 2016, the global company saw its income drop from £49.9 million in 2015 to £46 million.
There was also a huge decrease in the practice’s overall profit, plunging from £2.2 million last year to just £306,000 – largely caused by the company writing off £2.8 million on an unnamed problematic and ‘onerous’ mixed-use project in the UK.
Nevertheless, the company, which has 16 offices around the world, did see its gross margins increase from 32 per cent in 2015 to 36.8 per cent in 2016 and its gross profit rise from £16 million to £17 million.
Explaining the decline in international work, particularly in the Middle East and Asia, where turnover fell from £19.3 million to £17.2 million, the company said: ‘[It has been] an interesting year for the group, with external market volatility impacting several of our markets, including currency devaluation and economic downturn in China, the recession in Brazil, and the fall in oil prices, which significantly impacted oil-producing countries, particularly in developing regions.’
The practice added: ‘[There was also] the slowdown in the UK construction market towards the end of our financial year in the lead-up to the EU referendum.’
Broadway Malyan declined to say more about the £2.789 million write-off. the accounts describe the bad debt as an ‘onerous contract for a mixed-use development which was entered into during the recent recession’.
The company’s managing director Gary Whittle, insisted the last financial year had been ‘generally strong’ for the company and pointed to the growth in gross profit and improvement in gross margin.
He said: ‘This relatively robust performance against a backdrop of uncertainty in some global markets and issues such as the UK vote to leave the EU allowed us to make prudent financial decisions that will ensure the long-term financial health of the practice.’
Broadway Malyan has a strong pipeline of projects and we are already performing ahead of expectations in 2017
He added: ‘Looking forward, Broadway Malyan has a strong pipeline of projects and we are already performing ahead of expectations in 2017.’
He added: ‘The year also saw the practice win a number of major new commissions, including a new cruise liner terminal in Miami, which was won in an open competition against some of biggest names in our industry.’
Before Christmas Broadway Malyan submitted plans to convert the Gatton Manor hotel and golf club in Surrey into a health and wellness retreat and is currently working on masterplans for garden village projects at Longcross in Surrey and Dunton Hills in Essex, plus a garden town in Hertfordshire.