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August 25, 2010

Deloitte UK reports marginal revenue drop

Deloitte UK has reported a slight revenue drop despite a raft of high profile consulting acquisitions in the past year.

Deloitte’s revenue fell 1 percent to £1,953 million ($3,033 million) in the year to 31 May 2010.

All service lines except corporate finance suffered. Audit revenue had a 3 percent fall, Tax revenue was down 2 percent and consulting revenue dropped 4 percent on previous fiscal year results. The corporate finance business grew by almost 11 percent, a surprising result considering generally poor market conditions for M&A.

Deloitte’s profit for the financial year, which is distributed to the firm’s partners, was £590 million compared with £601 million in 2009.

The average profit earned by each partner was £873,000 compared with £883,000 last year.

The firm said it performed well given a challenging economic environment, and economic indicators back this up. The UK GDP contracted nearly 5 percent in 2009 and it is predicted to grow by 1 percent in 2010, adding shine to Deloitte’s performance.

“Whilst the economic environment will remain fragile, we anticipate a return to revenue growth for our audit, tax and consulting businesses in 2011,” Deloitte UK senior partner and CEO John Connolly predicted.

Deloitte increased its headcount to above 12,000 people and the firm added 118 new partners and associate partners.

There were several mergers for Deloitte in the past year which added more that 750 staff. Deloitte acquired real estate advisory firm Drivers Jonas, consulting firms ReportSource and Exsigno, sustainability consultancy dCarbon8, and risk and security firms IM Global and Simulstra.

Deloitte is the first Big Four firm to publish its figures in the UK, with rivals results expected in the next few months.

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