Half Year Results and Trading Update 9 th February 2017 Stephen - - PowerPoint PPT Presentation

Half Year Results and Trading Update

9th February 2017 Stephen Toole

Work generated – 1st half

• Work generated by Planning for other teams was a net

£2.4m, which is consistent with last year - note data accuracy relies on jobs being set up by the team

• riginating the work
• Planning teams generating a net 25%+ of their own fee

income for other teams comprised Reading (at 43%), Solihull, Ebbsfleet and Cambridge

• Masterplanning Bristol the most effective net referrer of

work within Design at a very creditable 55%

• 24% of total fee income was cross referred between

teams in the 1st half, consistent with last year – improving this is key to our growth strategy

• £15.8m fees invoiced in the 1st half was £0.2m less

than last year, although the 2nd quarter’s trading was ahead of the 1st - encouraging in light of the Brexit vote

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Fees – top 20 clients

• The house builders continue to feature strongly at 52%

(2015/16: 46%) of the top 20 clients’ fees and 29% of total fees (2015/16: 27%)

• This reverses the recent trend where we have been

gradually reducing this %

• Nonetheless encouraging to note 7 new entrants into

the top 20 from a year ago, as evidence of our strategic diversification as a business:

– Helical and Church Commissioners (re-appearing) – Segro (Solihull planning) – One Works (KAAR international) – Hermes Fund Managers (primarily Reading architecture) – Robertson Homes (Pennywell multi disciplinary) – Galliard (primarily London architecture)

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Fees – revised budget

• The revised fee budget for the year is £32.3m, a 2%

fall against last year’s fees overall and £1.74m less than that originally budgeted in May

• The re-budget equates to fees of £2.75m/month for the

2nd half (which we’ve achieved in the 3rd quarter)

• Our Town Planning and Landscape businesses are

trading ahead of the May budget and are still expected to show marginal growth overall in the year, whereas Design is now being re-budgeted to be down by 6.5%

• The reduction in internally referred Research and EIA

has resulted in a 23% adjustment in re-budgeted fees (36% Research and 9% Environmental)

• International work is holding up, although the cash flow

profile in this business continues to be challenging

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Historic and budgeted total income

• £5,000,000

£10,000,000 £15,000,000 £20,000,000 £25,000,000 £30,000,000 £35,000,000 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Revised Budget 2016-17 Expenses Fees

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Cost decisions post the Brexit vote

• Staff costs – annualised salary costs increased by

£700k inclusive of NI following the recent promotions, pay and benefits review

• Only limited recruitment in the 2nd half is being

proposed to manage overall staff numbers, which also saves £110k in recruitment costs

• A £170k reduction in IT costs assumed against the

May budget, net of retaining a £30k contingency for laptop replacements

• A £70k net reduction to the Marketing budget
• In aggregate, central overheads are being reduced

by £300k in the revised budget

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Contractual profit share (PSB)

• The profit assumption has been reduced to £49k per share in the

re-budget, reflecting the £2.1m less income and £1.6m less costs having taken action early

• Our business plan objective was to get to £60k profit per share by

2016/17, but Brexit has probably put paid to growing profit beyond last year’s £57.6k per share - for now at least

• Achieving £49k per share PSB would equate to a 15% decrease
• n the last 2 years but we proceeded with a pay and benefits

review, even though income is likely to be down this year

• If this were to be the eventual profit outturn then the final top-up

PSB payment next May would be half that paid out last year, everything else being equal, however this is only a budget

• The re-budget assumes £0.5m less fees in the 2nd half than last

year and there is capacity to deliver a further £0.5m fees beyond that i.e. £5k more PSB per share

• In light of Brexit, the Partners have taken the view that a trading
• utturn for the year in the range £49k to £54k per share PSB

would represent an excellent result

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Historic and budgeted PSB and profit

• £2,000,000

£4,000,000 £6,000,000 £8,000,000 £10,000,000 £12,000,000 £14,000,000 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 re-budget Profit share paid (incl. 10% NI) Profit before tax

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Practice Survey Update 2017 Results

Actions following previous surveys

• Support for those in managerial positions, including the introduction of a new

People Management workshop

• Improvements to the new starter process, including an enhanced and more

comprehensive central induction day.

• Continued enhancement to flexible benefits, with the introduction of Private

Medical Insurance for Associates and matched pension contribution increasing to 5% from November 2016.

• Improved communication of flexible benefits, including production of information

cards which were distributed to all staff ahead of the enrolment window in November

• Greater encouragement of CSER activities, including use of the available charity

day across the Practice and our corporate partnership with Shelter

• Greater support for those completing professional qualifications, including the

establishment of an APC study group

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Overall engagement scores (vs previous years)

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8 factors of engagement

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Practice results by factor v 2016

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4.1 4.3 4.5 4.7 4.9 5.1 5.3 5.5 5.7 Leadership My Company My Manager Personal Growth My Team Wellbeing Fair DealGiving Something Back (-2%) (+6%) (-1%) (-1%) (0%) (0%) (0%) (+3%) Barton Willmore - (BCI Survey 2017) Barton Willmore - (BCI Survey 2016)

Practice results by job level v 2016

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4.3 4.6 4.9 5.2 5.5 5.8 6 Staff Senior Associate Director (0%) (-2%) (+1%) (+1%)

Barton Willmore - (BCI Survey 2017) Barton Willmore - (BCI Survey 2016)

What makes this a great workplace?

• Interesting and varied projects and good clients
• Pride in working for a reputable and respected organisation
• Opportunities for development – supportive and encouraging managers, training

courses and being given responsibility to take ownership of own role

• The people - friendly, approachable, supportive
• Supportive teams – effective structure, collective spirit, good cross-sharing of skills
• Social events which help bring a friendly atmosphere and dynamic to the workplace
• Flexibility – comments here included flexible working hours in recognition of personal

commitments and family pressures, trust in staff to manage their own time and hours and a good work/life balance

• Approachable and knowledgeable people and management
• Integrated and cross-discipline working which adds value to professional experience

and to projects

• Reward – variety of flexible options, fair pay, effort being rewarded and acknowledged
• Autonomy given to individuals to progress, develop and be creative in their roles

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What would make this a better workplace?

• Improved communication and support from managers. Some also commented on wanting their

managers to be more visible

• More social events to encourage interaction, team building and morale
• Greater collaboration, knowledge sharing and communication between teams – including the
• pportunity to work with people from other offices and understanding what other teams do
• A greater awareness of a ‘one practice’ ethos as opposed to competition between teams and
• ffices
• Some commented on working pressure and having to work significant (unrecognised) overtime

to meet deadlines. This was referenced alongside resourcing needs in some teams

• Greater understanding of the promotions process / requirements for promotion
• Greater flexibility – comments here included suggestions for greater ability to work from home
• r out of other offices, and more flexible working hours
• There is an awareness of the impact of Brexit and some have commented they would like

more transparent communication regarding Practice strategy and decisions

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Proposed actions for 2017

1. Provision of further support, including tips, tools and techniques to managers, specifically in response to reductions in My Manager scores regarding motivation, support and information sharing. 2. Investigation into the lower levels of engagement amongst Seniors this year, specifically with relation to Fair Deal and Personal Growth. One area to focus on will be training needs and preferences (including CPD), especially amongst our experienced Seniors. 3. Improved communication between Partners (Senior Management) and our people, to address a perception of poor conflict management and active listening. 4. Investigation into why engagement levels are consistently lowest this year for those with 2-3 years’ service. 5. Whenever possible, encourage greater communication and collaboration across different teams, offices and disciplines in response to the considerable written feedback and desire for this within the survey comments. 6. More transparent discussions of survey results with staff at office level, with a suggestion being that each office looks to make at least one improvement in 2017.

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Benefits Update

Benefit Take Up Rates

Charitable Giving Childcare Vouchers Cycle to Work Gourmet Society Gym Membership Health Cash Plans Healthcare Assistance Holiday Buy Holiday Sell Life Assurance Pension Private Medical Insurance Tastecard Technology Devices 1st Nov 2015 1st Nov 2016

Key Points

• 93% of all Partners, Directors and Associates are

members of PMI scheme (80 out of 91 Associates joined in Nov 2016)

• 15% of employees are members of the Healthcare

Assistance benefit with Benenden.

• Of the 46 Benenden members, Staff and Senior take

up rates have increased by 62%

• Almost 94% of all eligible employees are a member of

the pension scheme

• Employees contributing 5% or more has increased

from 28.2% (Nov 15), to 59.4% (Nov 16)

April 2017

• Window opens last week of March for benefits effective

1st April 2017

• Holiday Buy and Sell window
• Second opportunity to opt into Gym Membership,

Tastecard/Gourmet Society and Healthcare Assistance* plus Childcare Vouchers, Cycle to Work and Charitable Giving

*NEW this April - second opportunity to opt in to Benenden Healthcare Assistance

Future Changes

• New Flexible Benefits Platform with effect from 1st July

2017

• Communication nearer to the launch will include details
• f how to log-in and navigate around the new platform
• Changes to benefits following Government Autumn

Statement – to be discussed later today

Review of Actions from

March 2016

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What’s changed…

Benefits

• Detailed information on each benefit
• Review of PMI and Pension
• Communication of benefit window
• Market data on annual leave allowance
• Awareness of flexi working

New Starters

• Induction booklet
• Local communication

CSER

• Publication of CSER report
• CSER coordinators
• Charity day

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Items Raised by Staff Feb 2017

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Pension

• Could contributions be based on total earnings (basic salary and PSB) ?
• Provision appears to be poor compared to other consultancies, what's the

plan?

Contract / policy

• Are there paid parental leave days when children are sick?
• How do salaries compare to other practices? Is profit share required to

make our salaries in line with the market?

• Do we have flexi working? What are the options/limitations? How do you

go about requesting this?

• Is there a ‘post Brexit’ update on overtime? Previous communication

suggested this would be reviewed in March, is this still the case?

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Benefits

• Clarification regarding any potential changes to benefits following the

Chancellors Autumn Statement

• Increase in Benefit in Kind tax rates on company cars – what des this

mean?

• Can a Will Writing service be considered as one of the benefits?
• Fixed term staff have less benefits than permanent employees. Not sure
• f the legalities of this, staff on these contracts feel it is unfair
• Can Technology Devices be made available for non-Apple products too?

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Annual Leave & Holiday Buy and Sell

• In comparison to other practices of our size, the holiday allowance BW

provide is the basic minimum. Could BW consider increasing the number

• f holidays per year?
• Many companies offer a holiday on your birthday, I think this is a nice

gesture as many people like to book their birthday off

• It would be good if we could buy holiday at any point throughout the year

rather than having to do it on a specific date

Mobile Phones

• If phones are not available for staff / seniors then a certain amount of

phone allowance each month should be made available to claim through expenses (at least)

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Long Service

• This payment is made to staff on their 15th Anniversary with the company.

However, staff who have been with the company for longer than 15 years did not receive this payment

Car / Mileage

• What is the justification for paying such a low rate per mile since

government allow 45p tax free for the first 10,000 miles then 25p per mile? This isn’t competitive & there was no explanation during the recruitment

• What’s the reason for change in BW policy not to allow purchase of

‘extras’ in company cars?

• Is there potential for improvements to the car list in general?

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Practice Party

• Has the practice party been cancelled, rather than postponed, and what

will happen in future years?

Induction / Training

• Every new starter should be shown how to use both our filing structure

and the basics of Newforma

• There should be a mandatory ‘walk-around’ on a new starter’s first day to

meet everyone, for the benefit of existing staff as well as the new person

• There should be basic first aid training for everyone, advanced first aid

for the first aid reps.

• A CIL training team is needed

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Ways of Working

• Document standard is not consistent between offices, The same type of

document produced in one office can be very different to another, why is this the case? Should we have consistent approaches to the production

• f documents we issue?
• A list of which partner is responsible for certain sectors would be useful
• Setup One Drive for all laptops so all files that are saved on desktop or

My Documents are stored in the cloud.

• IT – archiving jobs is creating problems
• The level of technical language in IT communication can often cause

confusion

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Ways of Working

• Being an established old company is a good thing but there are risks of
• complacency. The office lacks the energy and innovation of a start-up and

therefore may not be as open to new ideas and ways of working…

• How can the practice promote the ideas set out at the last PDA about

working across the practice. i.e. being more flexible in our approach to delivering our work for clients as part of all contributing to the ‘one pot’. Is this and how is this being taken forward?

• I think there needs to be more thought into how BW can become more

known about for architecture and design

• The current website is not easy to navigate. Colleagues have raised

concerns that they cannot send a specific link to a client directing them to a specific project relevant to that contact so do not use it

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