Jessica Fino 18 Sep 2017 09:03am

PwC's revenues grow but profits drop

Revenues at PwC UK increased by 5% this year, but profits and profit per partner fell due to Brexit uncertainty, investment in people and technology

While revenues grew to a record of £3.6bn for the year ended in June, profits fell 1% to £822m and the average distributable profit per partner before tax dropped 8% to £652,000, compared with £706,000 last year.

PwC remains the largest of the Big Four in the UK. Last month Deloitte posted revenues of £3.38bn and profits of £608m but Deloitte’s profit per equity partner was higher at £865,000.

PwC’s assurance, consulting and tax business divisions grew by 4%, 7%, and 7% respectively, but the deals practice fell 1% due to a decline of some long-term insolvency and forensic assignments, the firm explained.

Despite the decline in profit per partner, the number of equity partners increased from 926 to 953. PwC also recruited 1,300 experienced professionals, 1,500 graduates and school leavers and 960 students undertook paid work experience and internships. More than half (55%) of this year’s graduates were hired to roles based outside London.

Kevin Ellis, PwC chairman and senior partner, said, “Overall, business performance was solid in a challenging and complex market. We continued to invest significantly in our core and digital services, new technologies and create jobs, despite a slowdown in some sectors due to uncertainties related to the EU Referendum result and the US presidential and UK general elections.

“We saw high demand from UK and overseas clients for our insurance, regulatory and real estate services, as well as for supply chain, transaction services and cost reduction support. Across the UK, we grew strongly in Northern Ireland, Scotland, Midlands and the South East.”

The firm’s tax contribution was £1.16bn, up from £1.12bn last year. Its gender pay gap also improved this year and is now 13.7%, down from 15.2% in 2016.

PwC is one of the first firms publishing its BAME (Black and Minority Ethnic) pay gap, it revealed it stands at 12.8%. The firm said this was driven by the fact there were fewer BAME staff in senior roles and more in junior and administrative positions.