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September 15, 2008

PwC predicts tough times ahead

PricewaterhouseCoopers (PwC) UK anticipates tough trading conditions ahead, despite reporting turnover of £2.24 billion ($3.95 billion) and underlying profit growth of 7 percent in the year ended 30 June 2008.

The results confirm the gap between PwC and Deloitte, the second largest UK firm, is closing.

The margin between the two firms dropped from £305 million in 2007 to £230 million this year. In July, Deloitte reported its revenues had increased to £2.01 billion following 11.5 percent growth.

PwC UK chairman Ian Powell said growth remained strong in the first half but weakened in the second half of the year in what he described as the toughest economic conditions in a decade.

“The current economic uncertainty has affected business and consumer confidence with transactional activity down and a lowering of growth expectations for many UK and international businesses,” he said.

The UK market leader revealed turnover in assurance grew 3 percent to £1.04 billion, turnover in tax increased 8 percent to £675 million and turnover in advisory grew 13 percent to £526 million.

The increase in the firm’s advisory practice was attributed to very strong growth within the performance improvement consulting, forensic and corporate finance businesses.

PwC predicted human resource and sustainability services will continue to grow strongly. The firm said in the past year its sustainability business had doubled in size.

Powell, who took over from Kieran Poynter in July, said that over the next 12 months the firm will pursue advisory opportunities to corporate, mid-market and entrepreneurial private companies.

“We also see huge opportunities flowing from markets outside the UK and we are making the right investments to maximise these opportunities,” he said.

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