Downturn is takeover opportunity for Hyder

A credit crunch-induced downturn in the UK construction market could present Hyder Consulting with a series of takeover opportunities in  12 to 24 month times, chief executive Tim Wade said this week.

Until then the company is focusing takeover efforts on China and Australia, countries Wade does not expect to be as badly affected by any economic downturn.

Wade said: "I think that within the UK there is something of a skewed perspective when it comes to the credit crunch; outside of the US and the UK, this is not as big an issue."

He conceded that Hyder Consulting has significant exposure to the UK market, accounting for around 40% of group revenues but  views a downturn as a buying opportunity.

"We have a steady pipeline of acquisitions in place," he said. "China and Australia is where we are focusing that strategy. The UK is too expensive at the moment but perhaps in a year or two we will be back in the market."

Reflecting this strategy, six acquisitions contributed £1.1M to profit growth. During the year, the company acquired German firms SEIB and Voigt; Middle East architect Holford Associates; Australian consultants Crescent PSS and Quiggin Cook & Associates; and UK cost management consultant RPA.

Revenue growth of over 20% in Hyder's Middle East and Asia Pacific businesses and continued growth in UK/Europe all contributed to a 15% revenue increase to £233.7M. Combined with an improved margin on net fees of 7.6%, this lifted adjusted operating profit by 32% to £15M.