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WS Atkins plcAnnual Report 2010

ResultsResilienceGrowth >

Plan Design Enable

WS A

tkins p

lc Annual Report 2010

[email protected]

WS Atkins plc Annual Report 2010

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ResultsWe have successfully navigated turbulent markets by improving our business, reducing costs and flexing our resources to meet demand. We are well positioned for when growth returns.

ResilienceThe future for the built environment will bring more complex engineering challenges as clients put greater emphasis on planning and design disciplines to achieve maximum value from their infrastructure programmes. This is what Atkins does well.

GrowthWe are investing in technical excellence and people. We are also investing to improve our business, address growth markets and take advantage of market opportunities. >

This Annual Report is printed on Revive Pure White Uncoated, a 100% recycled paper made from post-consumer collected waste and manufactured to the certified environmental management system ISO 14001. It is TCF (Totally Chlorine Free), totally recyclable and has biodegradable NAPM recycled certification. The Atkins logo, ’Carbon Critical Design‘ and the strapline ‘Plan Design Enable’ are trademarks of Atkins Limited, a WS Atkins plc company. © WS Atkins plc except where stated otherwise.

Introduction 01


Our Year p04

Human Resources Review p36

Our Strategy p10

Corporate Responsibility Review p42

Introduction02 Group at a Glance04 Our Year06 Chairman’s Statement08 Chief Executive’s Statement10 Our Strategy

Reviews 16 Business Review16 Overview of the business

and performance in the year18 Segmental performance18 Design and Engineering Solutions20 Highways and Transportation22 Rail24 Middle East

26 China and Europe28 Management and

Project Services30 Asset Management32 Financial performance34 Principal risks and uncertainties36 Human Resources Review42 Corporate Responsibility Review

Financial Statements74 Consolidated Income Statement75 Consolidated and Parent

Company Statements of Comprehensive Income

76 Consolidated and Parent Company Balance Sheets

77 Consolidated and Parent Company Statements of Cash Flows

78 Consolidated and Parent Company Statements of Changes in Equity

79 Notes to the Financial Statements122 Five-year Summary

Governance 52 Board of Directors54 Directors’ Report58 Corporate Governance Report65 Remuneration Report72 Independent Auditor’s Report

Investor Information126 Company secretary and registered office126 Financial calendar126 Shareholder services

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02 Introduction


Group at a Glance

Atkins is the UK’s largest engineering and design consultancy and one of the world’s largest design firms.

We plan, design and enable our clients’ capital programmes.

We have the breadth and depth of expertise to respond to the most technically challenging and time-critical infrastructure projects and to facilitate the urgent transition to a low-carbon economy. >

Our business segments>

Design and Engineering Solutions

Highways and Transportation

Rail

We deliver engineering and technically integrated design to a wide range of largely UK clients in the public, regulated and private sectors. Our areas of operation include water, environment, nuclear, power, education, aerospace, defence, oil and gas and infrastructure design.

Our principal activities are transport planning, advising UK Government and highway authorities on transport policy and investment appraisals; the design of road improvements; applying intelligent transport systems to enhance network performance; and delivering integrated road network management and highway maintenance services.

We provide specialist design services across a range of engineering disciplines, including signalling, civils, electrification and specialist services in strategic planning, safety and systems integration principally for heavy rail, rolling stock and metro markets.

£390m Revenue

£300m Revenue

£186m Revenue

Relative size of segment by revenue



Introduction 03


Areas of operation

United Kingdom

10,620employees

North America

595employees

Middle East

2,345employees

Asia Pacific

1,170employees

Other Europe

870employees

1. Full-time equivalent staff at 31 March 2010 including agency staff.

Middle East China and Europe Management and Project Services

Asset Management

In the Middle East, we provide a full range of design, engineering and project management services for buildings, transportation and other infrastructure programmes from our nine centres across the region.

In China we provide engineering, planning, urban design, architectural services and rail design to both the mainland market and Hong Kong. Our European business comprises operations in Denmark, Ireland, Poland, Portugal and Sweden.

Faithful+Gould provides project and cost management services to a wide range of clients across the public and private sectors in the UK, USA and Asia Pacific. Our Management Consultants business offers strategy, design and programme management for technology-enabled business change.

We provide independent property asset management services to a number of private sector clients and to public sector organisations within central government, law and order, education, health and defence.

£137m Revenue

£134m Revenue

£203mRevenue

£56mRevenue





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Revenue £m

1009080706

-7%

1,38

7.9

1,05

2.5

1,179

.8

1,31

3.6

1,48

7.2

Normalised Profit before Taxation £m

1009080706

-4%

68.4 74

.1

91.9

100.

2

96.

5

04 Introduction


Our Year

Growth We are investing in technical excellence and people. We are also investing to improve our business, address growth markets and take advantage of market opportunities. >

Results We have successfully navigated turbulent markets by improving our business, reducing costs and flexing our resources to meet demand. We are well positioned for when growth returns. >

Resilience The future for the built environment will feature more complex engineering challenges as clients put greater emphasis on planning and design disciplines to achieve maximum value from their infrastructure programmes. This is what Atkins does well. >

We are continuing to develop our staff and making •selective investment across the Group. We are addressing very attractive markets including areas •such as renewables, nuclear and mass transit. We prioritise organic growth in the core businesses and •look to acquire additional skills in new or existing markets where they make sense. We will grow as a consequence of quality.•

The Group’s exposure to a variety of end markets provides resilience. We are a strong Group in several areas:

Scale – the ability to deploy staff•Breadth – a wide range of technical skills•Cash resources – important in uncertain times•Higher end activity – not commodity engineering•Adjacencies/skill transfer – applying skills in related areas.•

Quality remains a key determinant.

Normalised Diluted EPS Pence

1009080706

-5%

50.1 56

.5 66.7

82.3

77.8

Headcount

1009080706

-13%

14,9

07

15,8

68 17,2

78

18,0

17

15,6

01

Dividend Pence

+6%

1009080706

16

20

24

26 27.5

Operating Margin %

+1.2pp

1009080706

6.0 6.1 6.

6 6.9

8.1

Introduction 05


Notes1. Revenue excludes the Group’s share of revenue from Joint Ventures.2. Operating margin and normalised profit before taxation are before exceptional

items and any profits or losses from disposals, and related to continuing operations. This is considered to be more representative of underlying trading.

3. Normalised diluted earnings per share (EPS) is based on normalised profit after tax and allows for the dilutive effect of share options.

4. Headcount is shown on a full-time equivalent basis at the year-end, including agency staff.

5. Dividend relating to the year, comprising the interim dividend paid in the year and the proposed final dividend.

6. 2006/07 and 2007/08 figures are for continuing operations only.

3% 3%1% 4%

3% 1% 2%1% 1% 9%

2% 1% 1% 7%1% 1% 2%

2% 1% 2% 1%3% 2%3% 10% 2%

7% 11% 3%1% 2%

6% 1%UK defence

Public sector: national governmentPublic sector: local governmentRegulatedPrivate sector

Approximate percentages of total Group revenue

UK educationUK roads

UK railUK powerUK water

UK facilities managementUK other

Middle EastEurope ex UK

USAChina

Strategy Priorities Imperatives

•Multi-skill,multi-local•Identity+Excellence.

•High-performingbusiness•Addressingattractivesectors•Marketopportunities.

•Technicalexcellence•Carboncriticaldesign•Health,safety,diversity•Flexingresources•Businessimprovement.

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06 Introduction


Chairman’s Statement

Against a tough economic background, we have demonstrated the resilience of our strategy and our ability to produce strong results, and we are well positioned for when growth returns. >

Introduction 07


ResultsIn this, my first year-end as chairman, I am pleased to report that Atkins has had another good year. The Group’s diversified exposure to end markets provided resilience in a challenging environment. Group operating profit increased 9.6% to £113.0m and the Group’s operating margin improved to 8.1% from 6.9%. In the year ended 31 March 2010 the Group’s revenue reduced by 6.7% to £1,387.9m, on average staff numbers down some 8.7%.

Since joining the Board in September 2009 I have visited many of our offices within the business and I have been hugely impressed with the professionalism, talent and commitment of our staff who are delivering simple, but very effective, solutions to our clients’ complex infrastructure challenges. This is particularly impressive when, in the same period of operation, we have reduced headcount in response to market conditions.

The Group’s liquidity remains strong, driven by a good cash performance in the second half of the year, and we ended the year with net funds of £302.5m.

Our diversified exposure to end markets gives us added resilience to market fluctuations. However, the uncertainty of the impact of UK public spending cuts continues and we are prepared for a period of tighter Government spending. The future for the built environment will bring more complex engineering challenges as our clients put greater emphasis on planning and design disciplines to achieve maximum value from their infrastructure programmes. This is what we do well.

PeopleThe business relies fully on the ability of our employees to satisfy our clients’ requirements. In responding to market demand we have reduced our staff numbers by approximately 13% to 15,601 at the year-end. We have successfully redeployed more than 500 people into different roles across the Group and continue to recruit to fill specialist vacancies in the growth areas of our business. We continue to invest in the training and development of our people and, in particular, in the development of a suite of carbon calculation tools to help our staff and clients deliver lower carbon projects.

I would like to thank all our employees throughout the Group for their commitment and efforts during these testing economic times.

Board of directorsI would like to thank my predecessor Ed Wallis who retired as chairman in January 2010 after more than five years of dedicated service. Ed provided strong leadership and direction for the Board and we wish him every success for the future. I would also like to extend my thanks to James Morley, who had served as a non-executive director since January 2001 and more recently as the senior independent director, and stood down during the year. Within the year there has also been a smooth transition to Heath Drewett, who joined as Group finance director in June 2009, following the departure of Robert MacLeod.

DividendThe Board is recommending a final dividend of 18.25p, making the total dividend for the year 27.5p (2009: 26.0p), an increase of 5.8%. If approved, the dividend will be paid on 24 September 2010 to ordinary shareholders on the register on 20 August 2010.

OutlookThe Group has demonstrated its resilience in difficult economic conditions and with good levels of work in hand and a strong balance sheet we are well positioned for when growth returns.

Allan Cook CBEChairman16 June 2010

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08 Introduction


Chief Executive’s Statement

Our strategy and business model remain robust and relevant to the challenges and demands of our markets.

As clients put greater emphasis on planning and design disciplines to respond to the increasing complexity of their infrastructure programmes, we can look forward to the future with confidence. >

Introduction 09


Business positionThe world has been operating in an extended recessionary period. This recession affects most of our markets and our public and private sector clients throughout the world. Atkins has been successfully navigating these conditions by improving its business, reducing its costs and flexing its resources to meet demand. At the same time, we continue to invest and to develop our people. We are now well positioned for future growth.

Uncertainties remain, particularly in light of the UK Government debt position, which will undoubtedly put pressure on the Government’s finances in the near future.

The Group remains well placed with a broad range of sector exposure and end-client activities, which lend a degree of resilience to the business. With long-standing relationships with several public and private sector clients and activity at the specialist, non-commodity end of the services spectrum, we are well positioned to respond to the potential variability in the level of public sector spending going forward.

There will continue to be a demand for services where quality is a major determinant; at the same time the drive towards a low-carbon economy, allied to the need for greater capacity, reliability and predictability from existing assets, will play to the Group’s strengths.

In the Middle East we are seeing confidence slowly return and many markets and sectors are active. This remains an area that is attractive to Atkins – increasingly in the area of essential infrastructure – as the Group builds on decades of experience in the region.

Our European businesses, principally in Scandinavia, remain busy. The US workload continues to be steady, driven by a variety of clients. China remains a longer term prospect for the Group, underpinned by medium-term infrastructure demands.

PrioritiesWe are investing in technical excellence and in people. We have continued to train and develop our staff through these difficult times to ensure that our performance remains strong and that we will be well positioned for a world moving out of recession.

Our focus for 2010/11 revolves around actions to deliver our three strategic priorities:

developing our high-performing •businessesaddressing attractive sectors•taking advantage of market opportunities.•

We are confident that our business model is right and that, with the culture and skills within the Group, we are well placed to continue to progress in the years ahead.

Keith Clarke Chief executive 16 June 2010

Watch a video of Keith Clarke at www.atkinsglobal.com/video_prelims2010

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10 Introduction


What we do Plan Design Enable

Atkins designs intellectual capitalsuch as management systems and business processes. We also design physical structures such as office towers, schools, bridges and highways.

Our clients entrust us with themanagement of projects, people and issues – ensuring that deadlines are met, costs are controlled and success is delivered.

From cost and risk planning, feasibility studies and logistics to impact assessments and stakeholder engagement activity, we plan every aspect of our clients’ projects.

Vision

Objective

Our primary objective is to create long-term shareholder value measured by growth in normalised diluted earnings per share.

World’s Best Infrastructure Consultancy

We will target chosen geographies, and develop deep local expertise.

We will seek to consistently anticipate and address our clients’ needs.

Buildings, transport, utilities, government and industry and their social and environmental context.

Our primary business model will be selling expertise.

Our Strategy Overview

Introduction 11


Priorities

High-performing businesses To have a portfolio of high-performing businesses

Each business to continue to improve the quality of its skills in its local markets, developing capabilities and driving efficiencies – forging deep client relationships.

Addressing attractive sectors To have the breadth and depth of skills to address increasingly complex projects, increasing revenue in priority sectors

Maintaining or acquiring strong technical skills in robust markets and focusing resources from across the whole Group on exploiting opportunities in sectors such as mass transit, nuclear and renewables.

Market opportunities To have several home markets where the business is a market leader

Organic investment and acquisitions to strengthen our market position in our existing geographic markets and elsewhere.

Strategy

•Amulti-skill,multi-localstrategyofIdentity+Excellence

•Tooperateasanengineeringanddesignconsultancyinanumberoflocalmarketsaddressingpriority sectors with high-performing businesses.

Imperatives

Technical excellence We constantly strive for excellence and harness the range of skills that the Group possesses to answer our clients’ questions better.

Carbon critical design We are aiming to embed low-carbon design in all our work as a fundamental design parameter.

Health, safety, diversity We set our own challenging targets for health and safety. Innovation is important for success. Our ability to look at new ideas requires us to approach issues from several points of view, so diversity among our teams is essential.

Flexing resources Having a flexible resource base means the ability not only to react quickly when market conditions change but also to move work to where the Group resources can most effectively deliver it.

Business improvement (people, projects, cost)

Improving every aspect of our operations remains an ongoing imperative.

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12 Introduction


What we doPlan, Design, Enable is the simplest articulation of what Atkins does for its clients.

Plan – The challenges facing our clients are multidimensional, often because of the increasingly complex modern environment. From cost and risk planning, feasibility studies and logistics to impact assessments and stakeholder engagement activity, we plan every aspect of our clients’ projects.

Design – Atkins designs intellectual capital such as management systems and business processes. We also design physical structures such as office towers, schools, bridges and highways. Whatever we design, we always apply passion and creativity combined with rigorous quality standards.

Enable – Our clients choose Atkins because they want to focus on their core operations. They trust us to look after the management of projects, people and issues – ensuring that deadlines are met, costs are controlled and success is delivered.

VisionOur vision is to be the world’s best infrastructure consultancy.

‘World’s’ means that we will develop deep local expertise in certain targeted geographies. We aim to be recognised as the best infrastructure consultancy in our chosen geographies because of the projects and service we deliver. We will not be global, with offices everywhere, although our multi-national reach will be extensive.

‘Best’ means that we will be close to our clients, anticipating their needs, developing long-term relationships and winning repeat business. We aim to help answer questions our clients don’t know they need to ask. We will help them to define those questions. Our values will govern the way we carry out our work – with integrity and respect, always striving for excellence. We will not necessarily be the biggest or broadest – although this may be one consequence of our success.

Our skills lie in the expansive area of ‘infrastructure’ – the wiring of society – encompassing buildings, transport and utilities (including power and water), as well as work for national and local governments and other industrial clients. The social and environmental framework, combined with our social policy planning skills, is also important; it is essential that we view all of our projects in the context of the communities in which they will be undertaken.

‘Consultancy’ means that we will operate a business based on selling advice and expertise. We are not a developer, construction company or generalist outsourcer. We do, however, have the financial status and commercial skills to successfully engage in the wide variety of contract forms that clients increasingly demand.

Our Strategycontinued

Our vision is to be the world’s best infrastructure consultancy and we have a clear strategy to achieve this. >

For more information about what we do visit www.atkinsglobal.com/showcase

Introduction 13


ObjectiveOur primary objective is to create long-term shareholder value measured by growth in normalised diluted earnings per share. We need to maximise the return we generate for shareholders by successfully operating in appropriate markets with the resources available to us.

We remain confident that our core activity, that of professional design consultant serving the built environment, will enable us to continue to be a successful company. We believe our objective can be best achieved by continuing to develop the current business model of predominantly professional consulting – Plan Design Enable – with the ‘enable’ part generally limited to activities such as management of road maintenance and rail signalling where our technical expertise gives us a competitive advantage.

StrategyWe will achieve our vision through our multi-skill, multi-local strategy of Identity+Excellence. The strategy entails operating as an engineering and design consultancy in a number of local markets, serving priority sectors with high-performing businesses.

The three principal priorities of the strategy are:

High-performing businessesOur decentralised organisation, which empowers local management, allows businesses to be largely autonomous whilst also having the capability to leverage resources from across the Group.

Our businesses drive competitive advantage at a local level, where deep local relationships are forged.

Each business will continue to improve the quality of its skills in its home markets, developing capabilities and driving efficiencies. At business unit level the strategy remains to ensure we maintain a deep understanding of the skills demanded and offered (Identity) and to deliver these to a degree of quality which keeps us competitive (Excellence). We refer to this as ‘Identity+Excellence’.

Addressing attractive sectorsApplying the multi-skill approach in several home markets means that resources and skills from across the whole Group can be focused on exploiting opportunities.

Areas such as energy and mass transit demand investment and collaboration across businesses. We will utilise Group resources to address these areas.

Market opportunitiesThe multi-local approach means having several home markets where our business is a market leader.

Geographic markets outside the UK present attractive opportunities for further growth. Acquisitions and organic investment will be considered to strengthen our market position in our existing geographic markets and to establish Atkins elsewhere. The Group has the resources to undertake material acquisitions if the skill-set and cultural fit are right.

Market positionThe majority of our business is in the UK, which remains the core market for our activities. Our existing businesses outside the UK present attractive opportunities for further growth. The huge potential outside the UK includes areas where we are well established such as the Middle East, which despite recent liquidity issues, represents a significant growth opportunity.

We have strong technical skills in a number of robust markets where quality is a significant determinant for selection:

In the UK we have niche positions in •numerous markets and have a material market share in our chosen sectors. We will continue to invest in management and to deepen our skill base. We will continue to position parts of the Group for growth, whilst in other areas undertaking controlled reduction or exit of businesses, or structuring ourselves appropriately for any downturns in activity. In the Middle East we will continue •to add niche skills and prepare for the economic upturn.In Asia Pacific we will continue to •invest in China to take advantage of opportunities as the market opens up, recognising that it could be several years before material growth is achieved. In Hong Kong we will broaden our spread of activity beyond a principally transport-biased platform.In Europe we will continue to develop our •local businesses, focusing particularly on opportunities in Scandinavia which build on our rail expertise. In the USA, Faithful+Gould and our •oil and gas businesses provide the organic growth focus. Skill additions remain possible. Other geographic areas will continue •to be reviewed.

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14 Introduction


ImperativesWe have identified a number of imperatives within the strategy.

Technical excellence Atkins has a huge range of technical skills, evidenced by the vast array of services that the Group offers. Our drive for improvement and growth has been organic, although supplemented by targeted bolt-on acquisitions. We have continued to make good progress in acquiring new skills and extending our capabilities in recent years.

Our ability to mobilise multidisciplinary teams and deep expertise from around the Group for local projects is a demonstrated capability that we have continued to successfully develop.

We constantly strive for excellence and harness the range of skills that the Group possesses to answer our clients’ questions better.

Carbon critical design As all major world economies struggle with the transition to low-carbon operation, a number of challenges and opportunities arise for firms at the forefront of infrastructure design.

Our carbon critical design programme is producing new ideas and ways of working. We are aiming to embed low-carbon design in all our work as a fundamental design parameter.

Health, safety, diversity We set our own challenging targets for health and safety and our performance remains better than industry performance as compiled by the Health and Safety Executive (HSE) in its Labour Force Survey. We are keen to continue to improve, by expanding our safety leadership programme and reducing our tally of manual handling accidents, which account for 40% of serious accidents in construction. We also actively encourage the reporting of incidents and near-misses as a positive step towards accident prevention. All our operations are covered by OHSAS 18001 and we have achieved certification to the revised standard OHSAS 18001:2007. We achieved a Group-level RoSPA Gold award for the first time. In addition, our Highways and Transportation business received a Gold award for the fifth consecutive year and Asset Management achieved an Order of Distinction for the 23rd year running.

Innovation is important for success. Our ability to look at new ideas requires us to approach issues from several points of view and therefore diversity among our teams is essential to drive the rate of innovation. It is also essential that we attract, retain and develop talented individuals who reflect the diverse nature of the areas in which we work. Success in this regard is critical for us in order to build a balanced workforce to meet our clients’ needs, to broaden our skills base and to address a growing skills deficit in the science and engineering disciplines.

Flexing resources Having a flexible resource base means the ability not only to react quickly when market conditions change but also to move work to where the Group can most effectively deliver it. The Group is agile and flexible enough to continue to hire as necessary and shrink where required to maintain levels of performance. Our local management teams are also able to draw upon the Group’s wide range of skills and resources to leverage capability from one region to another – collaborating and sharing knowledge across the Group.

Business improvement Improving every aspect of our operations remains an ongoing imperative. We constantly aim to become more efficient in everything we do to deliver cost-effective solutions for our clients. We draw on the talent of our people and enhance their capabilities, driving efficient project management in our principal activities.

Our Strategycontinued

See pages 36 to 41 for our Human Resources Review

See pages 42 to 50 for our Corporate Responsibility Review

Reviews

Reviews16 Business Review 16 Overview of the business

and performance in the year 18 Segmental performance 18 Design and Engineering Solutions 20 Highways and Transportation 22 Rail 24 Middle East 26 China and Europe 28 Management and Project Services 30 Asset Management 32 Financial performance 34 Principal risks and uncertainties36 Human Resources Review42 Corporate Responsibility Review

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16 Reviews

Business ReviewOverview of the business and performance in the year

We plan, design and enable our clients’ capital programmes. >

Our businessOur core business is helping our clients to plan, design and enable capital programmes that resolve complex challenges in the built and natural environment. We are able to plan all aspects of our clients’ projects, conducting feasibility studies and impact analyses covering technical, logistical, legal, environmental and financial considerations. We design systems, infrastructures, processes, buildings and civil structures. We enable our clients’ complex programmes by optimising procurement methods and managing supply chains on their behalf to reduce timescales, cost and risk.

We report our activities in seven business segments as this reflects how we manage the business via different markets and geographies. Details of activities and results by business segment are shown in the segmental performance section which follows.

Key performance indicators The Group uses a range of performance measures to monitor and manage the business. Those that are particularly important in monitoring our progress in generating shareholder value are considered key performance indicators (KPIs). Our KPIs measure past performance and also provide information and context to anticipate the future and, in conjunction with our detailed knowledge and experience of the segments in which we operate, allow us to act early and manage the business into the future. Revenue, operating profit and margin, earnings per share (EPS) and operating

cash flow indicate the volume of work we have done, its profitability and the efficiency with which we have turned operating profits into cash; work in hand measures our secured workload as a percentage of the budgeted revenue for the next year; staff numbers and staff turnover are measures of capacity and show us how effective we have been in recruiting and retaining our key resource. KPIs for 2010 are shown on page 17, along with prior year comparatives.

Review of the yearWe are pleased to report that Atkins has had another good year. Group operating profit from continuing operations increased by 9.6% to £113.0m and the Group’s operating margins grew to 8.1% from 6.9%. In the year ended 31 March 2010 the Group’s revenue from continuing operations reduced by 6.7% to £1,387.9m, on average staff numbers down some 8.7%. Translated at constant exchange rates, revenue reduced by 8.8% and operating profit grew by 5.7%.

Despite a strong operating profit performance, the Group’s significantly increased pension costs and lower returns on its cash and other financial assets resulted in a reduction in profit before tax.

Profit before tax was £96.6m and included £0.1m of profit on disposal of a Joint Venture. This gives a normalised profit before tax of £96.5m (2009: £100.2m). There was also a pension curtailment gain of £2.6m reported in the first half which, if excluded, gives a more comparable profit before tax of £93.9m.

In addition, there was a profit from discontinued operations of £25m relating to the release of a provision following the expiry of a letter of credit in respect of the Metronet enterprise.

Normalised diluted EPS reduced by 4.5p per share to 77.8p, a decrease of 5.5%, reflecting the decrease in normalised profit before taxation.

Operating cash flow in the year was £126.5m, representing 112% of operating profit. The Group’s liquidity remains strong, driven by good cash performance in the second half of the year, and we ended the year with net funds of £302.5m.

At 31 March 2010 we had secured 54% of budgeted revenue for 2010/11, in line with this time last year.

Staff numbers were reduced by 2,416 (13.4%) to 15,601 at the year-end. Of this reduction, approximately 600 people were already under notice at the start of the year, giving an in-year reduction of 1,816 staff from an adjusted opening headcount of approximately 17,400.

Segmental analysis of revenue, operating profit, work in hand and staff numbers follows, while staff turnover is discussed further in the Human Resources Review.


Reviews 17

Key performance indicators Continuing operations Note 2010 2009 change

Financial metrics Revenue 1 £1,387.9m £1,487.2m -6.7% Operating profit £113.0m £103.1m +9.6% Operating margin 8.1% 6.9% +1.2ppNormalised profit before tax 2 £96.5m £100.2m -3.7%Operating cash flow £126.5m £125.5m +0.8% Normalised diluted EPS 2 77.8p 82.3p -5.5% Work in hand 3 54% 54% -0ppPeople Staff numbers at 31 March 4, 5 15,601 18,017 -13.4% Average staff numbers for the year 4 16,421 17,988 -8.7% Staff turnover 6 8.6% 11.4% -2.8pp

Notes:1. Revenue excludes the Group’s share of revenue from Joint Ventures.2. Normalised diluted EPS is based on normalised profit after tax (less exceptional items and any profit or losses

from disposals) and allows for the dilutive effect of share options. 3. Work in hand is the value of contracted and committed work as at 31 March that is scheduled for the

following year, expressed as a percentage of budgeted revenue for the year.4. Staff numbers are shown on a full-time equivalent basis, including agency staff.5. Staff numbers at 31 March 2009 included approximately 600 staff under notice of redundancy.6. Staff turnover is the number of voluntary staff resignations in the year, expressed as a percentage of average

staff numbers.

Revenue by market Roads 25% Rail 22% Commercial buildings 5% Defence 5% Oil and gas 5% Water 5%

Urban development 4% Education 4% Environment 3% Aerospace 2% Other 20%

Revenue by geography UK 72% Middle East 11% Europe 6% Asia Pacific 6% North America 5%

Revenue by client type Public sector: local government 25% Public sector: national government 22% Regulated 17% Private sector 36%

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18 Reviews

Business ReviewSegmental performance

Design and Engineering SolutionsKey performance indicators 2010 2009 change

Financial metrics Revenue £390.3m £435.0m -10.3%Operating profit £31.3m £31.6m -0.9%Operating margin 8.0% 7.3% +0.7ppWork in hand 45% 43% +2ppPeople Staff numbers at 31 March 4,400 5,167 -14.8%Average staff numbers 4,664 5,133 -9.1%

Nuclear 7% Education 6% Energy 5% Telecommunications 4% Rail 4% Other 7%

Revenue by market Defence 19% Water 13% Environment 10% Oil and gas 9% Aerospace 8% Urban development 8%


Revenue £m

10

390.

3435.

0

373.

6

321.

2

269.

5

09080706

Operating profit £m

10

31.3

31.6

30.1

27.0

22.5

09080706

Average staff numbers

10

4,66

45,13

3

4,72

2

3,98

0

3,38

4

09080706


Reviews 19

Overall, the Design and Engineering Solutions segment performed well despite difficult market conditions for some of our businesses.

We improved margins to 8.0% (2009: 7.3%) on reduced revenue of £390.3m (2009: £435.0m), with operating profit broadly flat at £31.3m (2009: £31.6m).

This segment contains a mix of businesses that are at different stages of the economic cycle.

Our water business was restructured in the early part of the year in anticipation of reduced activity levels. The regulatory Asset Management Programme (AMP) cycle in the water sector delayed the release of work to the market and the usual hiatus experienced with this cycle was longer and deeper than in previous transitions. Our work on flood mitigation for the Environment Agency continued, with wins on the South West Coastal Strategy Packages delivering three large flood risk management and habitat creation strategies covering Poole Harbour, the Exe Estuary and the Taw and Torridge Estuaries. Our land remediation business remains busy with the Olympic Park and an equal-sized site in South Wales for St Modwen Properties plc.

Our UK building design business was also restructured in the early part of the year in anticipation of reduced activity levels, but then stabilised with wins in the education and healthcare sectors, most notably the New Campus Glasgow and NHS Tayside Murray Royal Hospital. We have limited exposure to the private developer market, which remains difficult.

We continued our successful relationship with the Olympic Delivery Authority and the London Organising Committee of the Olympic Games as the official engineering design services provider for the London 2012 Games.

Our businesses focusing on high-technology industries such as defence, aerospace and communications have delivered solid performances. We continue to support UK Government departments and industry on key strategic programmes, which we expect to continue in the future. In our aerospace business we remain a key supplier to Airbus and have expanded our footprint in Europe with key wins in Germany on the A350 and A380 programmes. Further success has also been achieved in the UK with key roles on the A320 Sharklet programme and expansion into landing gear systems. Communications and security continue to be strong market segments in which our skills and capabilities remain in high demand.

Our energy business has performed well, assisted by the imperative to decarbonise the UK’s generation capacity via nuclear and offshore wind. Our work on existing nuclear generation and decommissioning has been augmented by a number of commissions in the nuclear new-build arena for utilities and for the Department of Energy and Climate Change. Additionally, we have recently announced success in winning a major contract on the International Thermonuclear Experimental Reactor (ITER) programme being built in the south of France. ITER is the next step in a global research and development programme to harness nuclear fusion to generate electricity. The €150m contract was won by a multidisciplinary Atkins team, working in a Joint Venture alongside three other companies. As architect engineer the Joint Venture is providing full multidisciplinary design services for the €3bn project.

Our experience in the offshore oil and gas industry has allowed us to take a significant position in the marine renewables sector, which is a key component of the UK Government’s low-carbon strategy. We have won major design assignments on the Gabbard and Lincolnshire offshore wind farm developments. We have built significant capability in this sector and our

multidisciplinary approach combining our experience in offshore structures, power transmission and distribution makes us well placed for this expanding market. Our oil and gas activity expanded during a year that has seen significant oil price fluctuation. Our core skills in high technology are well suited to meet the industry’s requirements to extend the life of ageing assets and to move increasingly into areas of deepwater operation.

We continue to win projects internationally, with masterplanning studies in countries such as Saudi Arabia and Azerbaijan and internationally funded water resource projects in Europe and Africa.

OutlookThe overall outlook for Design and Engineering Solutions is good and with work in hand of 45% of budgeted revenue for 2010/11 (2009: 43%) we are in a slightly stronger position than at the same time last year.

Following restructuring, our water and UK building design businesses are now well placed with a good order book. In our water business, we have successfully secured a stronger position on frameworks for the next regulatory period, which commenced on 1 April 2010. Our infrastructure design business has a healthy workload and is focusing on successful delivery of the London 2012 Games programme. Our defence and security business is well positioned for enabling cost-effective change and procurement programmes, in an increasingly cost-conscious market. In aerospace, we are expanding our breadth of service and geographical footprint, which will provide a good platform for future growth.

We continue to invest in resources to meet increasing demand for our services in the energy sector, especially in nuclear but also in oil and gas and renewables.

Official engineering design services provider for the London 2012 Olympic Games

For more information visitwww.atkinsglobal.com/london2012

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20 Reviews

Business ReviewSegmental performancecontinued

Highways and TransportationKey performance indicators 2010 2009 change

Financial metrics Revenue £300.4m £308.2m -2.5%Operating profit £21.4m £19.9m +7.5%Operating margin 7.1% 6.5% 0.6ppWork in hand 69% 62% 7ppPeopleStaff numbers at 31 March 2,931 3,075 -4.7%Average staff numbers 2,975 3,016 -1.4%

Revenue by market Highway services 57% Design 23% Intelligent transport systems 10% Planning 10%

Revenue by client type Public sector: local government 52% Public sector: national government 35% Private sector 13%

Revenue £m

10

300.

4

308.

2

306.

2

259.

4

224.

6

09080706


10

21.4

19.9

17.8

14.1

12.1

09080706


10

2,97

5

3,01

6

3,05

4

3,06

7

2,83

4

09080706


Reviews 21

Our Highways and Transportation segment performed well in the year, benefiting from the UK Government’s financial stimulus and our M25 contract.

Operating profit increased 7.5% to £21.4m (2009: £19.9m) and margins increased to 7.1% (2009: 6.5%), principally due to the strong demand for our higher-margin consultancy activities and the benefits of our continued drive for greater efficiencies. In an increasingly competitive market and with average staff numbers marginally lower than last year, revenue was down 2.5% year on year.

We won over £1bn of work in the year to 31 March 2010, including a five-year contract with Somerset County Council (from 1 April 2010), a three-year extension by Gloucestershire County Council (from 1 April 2011) and our share of the turnover from the M25 widening DBFO contract that reached financial close in May 2009.

Our highway services business, which represents around 57% of this segment’s revenue, is engaged in maintaining and improving highway networks on behalf of the UK Highways Agency and local authorities. We have significant work in hand for the next few years with none of our existing major contracts due to expire before mid 2013.

In April 2010 we commenced delivery as the highways’ maintenance, design and construction provider for Oxfordshire County Council. This ten-year contract, worth around £350m, with potential extensions of up to ten years, involves policy and strategy advice and support, design services, network management, construction of improvement schemes and cyclic, reactive and planned maintenance.

Mobilisation during the second half of the year for the new five-year Somerset network management contract went well.

This contract builds on nearly 14 years of continuous service to the county. Our contract with Gloucestershire County Council has been extended by three years to 2014 and we continue our work with Cambridgeshire County Council and for the Highways Agency in the Area 6 Managing Agent Contractor (MAC) contract.

Our transport solutions design business, which delivers technical consultancy and R&D services as well as all aspects of highway infrastructure design, performed very well on a broad portfolio of projects for a range of clients.

Design work on the M74 project in Scotland is now nearly complete. On the M25 contract, we are providing the design expertise for the 40-mile widening programme and work will be completed in time for the London 2012 Games. The related 30-year operation and maintenance Joint Venture contract with Balfour Beatty (52.5%) and Egis (15%), commenced successfully in September 2009. Atkins (32.5%) will provide services in network management, asset inspection, traffic management, tunnel operations, incident management, and routine and winter maintenance for the entire M25 covering a distance of 250 miles.

Our intelligent transport systems (ITS) business has had another good year, growing to a business of 350 people as the market for technology-based solutions develops in response to traffic management, capacity and sustainability challenges. There was very strong demand from the Highways Agency for our services, on projects such as managed motorway schemes to improve journey time reliability through hard shoulder running and managing the technology delivery and upgrade programme on the A14 corridor traffic management scheme. We continue to develop and implement technology infrastructure for the network management

and traveller information systems which we operate in the national traffic control rooms in Scotland and Wales. Our contract with Essex County Council, through which we develop and operate its ITS assets, is now in its tenth year.

Our transport planning business provides a wide range of consultancy services, including advice on strategy, policy, management and forecasting, as well as business case and investment appraisals for infrastructure investment. Although there was a marked decrease in work from the private sector, work in the development planning and other markets remained solid with wins on public sector projects such as the Elephant and Castle Surface Interchange Feasibility Study, the Oxford Circus interchange and work on the UK Government’s housing growth agenda. A further key success in the year was winning more than 20% of the studies in the Government’s ‘Delivering a Sustainable Transport System’ programme, which will identify and provide evidence to support long-term strategic transport investment priorities.

OutlookWe continue to win work at acceptable rates in an increasingly competitive market. We are prepared for UK Government and local authority spending cuts, having addressed our cost base and secured significant future work. Additionally, some local authority clients are actively discussing extensions to our consultancy commissions and Birmingham City Council has recently agreed to continue working with us until May 2012.

The uncertain market outlook is partially offset by our recent contract wins, and work in hand at 31 March 2010 was 69% of budgeted revenue for 2010/11 (2009: 62%).

Awarded £350m Oxfordshire County Council contract

For more information visitwww.atkinsglobal.com/win_oxfordshire_cc

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22 Reviews


RailKey performance indicators 2010 2009 change

Financial metrics Revenue £185.7m £196.1m -5.3%Operating profit £16.8m £17.0m -1.2%Operating margin 9.0% 8.7% +0.3ppWork in hand 53% 61% -8ppPeople Staff numbers at 31 March 1,420 1,624 -12.6%Average staff numbers 1,483 1,635 -9.3%

Revenue by activity Signalling 43% Design 28% Consultancy and other 24% Communications 5%


Revenue £m

10

185.

7

196.

1

208.

2

215.

1

154.

6

09080706


10

16.8

17.0

11.9

5.2

1.7

09080706


10

1,48

3

1,63

5

1,70

3

1,64

8

1,58

7

09080706


Reviews 23

The Rail segment had a good performance this year.

This segment recorded an improved margin of 9.0%, benefiting from the phasing on a number of major projects, and an operating profit of £16.8m (2009: £17.0m). Revenue was down 5.3% on last year, reflecting delays in projects coming to market in the early part of the year and the demobilisation of our structures examination contract for bridge inspection.

Our signalling business remains busy and good progress was made in year with our major re-signalling projects for Network Rail, which account for more than 40% of our revenue.

We successfully completed the first phase of the Newport re-signalling programme at the end of the calendar year and we have made significant progress on the installation for the next commissioning phase. Work on the North London Line project, which forms part of the Olympic 2012 transport plan, is progressing well. These two projects have combined contract revenue of over £100m.

The other part of this business, which focuses on rail-related design and consultancy services, has also performed well. Our multidisciplinary design work for Chiltern Railways’ enhancement project continues and we are now working on the signalling and detailed design for the main contractor. The design for the complex Farringdon Station for Thameslink is nearly complete and we are well positioned for further Thameslink opportunities. We also have ongoing work for Transport for London and London Underground.

Work is progressing well with our partner Arup on the design for 22 kilometres of twin-bored tunnel for Crossrail, one of the largest and most important elements of this significant project. We are also undertaking design work for Tottenham Court Road and Custom House stations.

In Scotland we continue to work closely with Network Rail on the Edinburgh to Glasgow electrification and follow-on work packages.

OutlookOur signalling business has a leading market position and there is a large programme of improvements needed to the rail network to meet medium-term passenger demand. These are currently planned under the Office of the Rail Regulator’s rail budget for Control Period 4 (2009 to 2014), though this is likely to come under some further scrutiny by the current Government.

With reduced work in hand of 53% at 31 March 2010 (2009: 61%) the outlook for this segment is challenging.

Design of Crossrail’s Custom House and Tottenham Court Road stations

For more information visitwww.atkinsglobal.com/win_crossrail

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24 Reviews


Middle EastKey performance indicators 2010 2009 change

Financial metrics Revenue £136.6m £186.0m -26.6%Operating profit £14.0m £17.3m -19.1%Operating margin 10.2% 9.3% +0.9ppWork in hand 57% 53% +4ppPeopleStaff numbers at 31 March 1,867 2,824 -33.9%Average staff numbers 2,154 2,823 -23.7%

Roads 9% Oil and gas 5% Hospitality 5% Other 9%

Revenue by market Commercial buildings 31% Rail 19% Urban development 13% Residential buildings 9%

Revenue by geography Dubai 37% Abu Dhabi 22% Other UAE 6% Bahrain 10%

Oman 9% Qatar 7% Other Middle East 8% India 1%

Revenue £m

10

136.

6

186.

0

112.

2

79.3

41.0

09080706


10

14.0

17.3

9.5

7.0

3.3

09080706


10

2,15

4

2,82

3

2,11

9

1,41

7

783

09080706


Reviews 25

Our Middle East business continues to successfully navigate a difficult economic climate. Confidence and liquidity is beginning to return to the region with the strongest opportunities relating to public sector infrastructure.

Compared to last year we have extended our order book, which stood at 57% of budgeted revenue for 2010/11 at 31 March 2010 (2009: 53%). During the year, we reduced our headcount in the region in anticipation of lower activity and we ended the year with 1,867 staff (2009: 2,824). Our continued focus on margins is reflected in the improvement in the year to 10.2% (2009: 9.3%).

The profile of our debt in the Middle East, in common with the market as a whole, has continued to deteriorate. We have maintained the Group policy of providing for all debt greater than 180 days, or sooner if there is a risk of non-recovery.

We have a well-established presence in six primary locations in the region, centred on Abu Dhabi and Dubai, and we continue to expand our footprint in the region both in terms of geographical location and the breadth of sectors we serve.

We are investing in and securing work in defence, energy, planning and management consultancy, while at the same time adding to our existing infrastructure, building design, planning and oil and gas businesses.

Our work on the Red Line of the Dubai Metro was fundamental to its high-profile and successful opening on 9 September 2009. The Dubai Metro is the world’s longest automated driverless metro system, with more than 25 overground stations, four underground stations and over 47 kilometres of viaducts. Our work on the Dubai Metro Green Line continues, along with other rail-related work such as the Makkah Metro project in Saudi Arabia, which is progressing well.

Outlook Market sentiment is improving and the action taken to reduce headcount to match forward workload and increase efficiency positions us well for future growth, although the timing of work starting on projects secured remains a little unpredictable. Our planning and consultancy business is seeing increasing opportunities with clients seeking greater clarity and certainty about their business cases before investment.

Dubai Metro Red Line successfully opened as scheduled

For more information visitwww.atkins-me.com

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26 Reviews


China and EuropeKey performance indicators 2010 2009 change

Financial metrics Revenue £134.1m £117.2m +14.4%Operating profit £6.1m £4.9m +24.5%Operating margin 4.5% 4.2% +0.3ppWork in hand 57% 54% +3ppPeople Staff numbers at 31 March 1,774 1,741 +1.9%Average staff numbers 1,780 1,675 +6.3%

This segment consists of our design and engineering consultancy businesses in Hong Kong and mainland China and five countries across Europe: Denmark, Ireland, Poland, Portugal and Sweden.

The portfolio of businesses in China and Europe has increased revenue by 14.4% and improved margins year on year, with average staff numbers up 6.3%.

Revenue by market Rail 42% Urban development 13% Roads 12% Commercial buildings 12% Water 11% Residential buildings 4% Other 6%

Revenue by geography Hong Kong 67% Mainland China 32% Other Asia Pacific 1%

Revenue by market Rail 59% Roads 17% Environment 7% Water 2% Energy 2% Oil and gas 2% Other 11%

Revenue by geography Denmark 46% Sweden 17% Ireland 14% Portugal 11% Poland 8% Other 4%

China Europe

Revenue £m

10

134.

1

117.

2

79.4

69.6

64.8

09080706


10

6.1

4.9

1.9

0.5

1.4

09080706


10

1,78

0

1,67

5

1,54

1

1,47

0

1,35

9

09080706


Reviews 27

Awarded the detailed design of Hung Hom Station for Hong Kong’s Mass Transit Rail Corporation’s Shatin to Central Link

For more information visitwww.atkinsglobal.com/win_hung_hom

ChinaKey performance indicators 2010 2009 change

Financial metrics Revenue £64.0m £46.1m +38.8%Operating profit £3.7m £2.7m +37.0%Operating margin 5.8% 5.9% -0.1ppWork in hand 64% 71% -7ppPeopleStaff numbers at 31 March 997 933 +6.9%Average staff numbers 995 890 +11.8%

Our China business continues to expand as a consequence of success in the buoyant Hong Kong rail infrastructure market.

We employed nearly 1,000 staff in the region at the year-end (2009: 933). Revenue increased almost 40% to £64.0m with an increase in operating profit to £3.7m (2009: £2.7m) and a slight decline in operating margin year on year.

In Hong Kong we continue to support the expansion of the rail network through the delivery of a wide range of multidisciplinary services to the Mass Transit Rail Corporation on the preliminary and detailed design of various sections of the West Island Line, Express Rail Link, South Island Line and Shatin to Central Link. These design contracts include stations, tunnels and viaducts. The most recent assignment secured is for the detailed design of the Shatin to Central Link’s Hung Hom Station and associated tunnels.

Our urban planning and architectural business operates out of three primary locations in mainland China, in Beijing, Shanghai and Shenzhen. This business is performing in line with our expectations in a very competitive but buoyant property market, and we have focused our effort over this last year on improving the quality of our offering in this market.

OutlookThe prospects for our business in China remain good with the Hong Kong Government committed to annual capital works expenditure in the next few years at double the rate of recent years. We expect our Hong Kong business to remain busy, serving clients in the highways, geotechnical, water and rail sectors, and we will continue to expand our technical offering in other areas. The property market in mainland China remains strong.

Work in hand for the Chinese business is 64% of budgeted 2010/11 revenue (2009: 71%).

EuropeKey performance indicators 2010 2009 change

Financial metricsRevenue £70.1m £71.1m -1.4%Operating profit £2.4m £2.2m +9.1%Operating margin 3.4% 3.1% +0.3ppWork in hand 51% 42% +9ppPeople Staff numbers at 31 March 777 808 -3.8%Average staff numbers 785 785 0%

Our European portfolio performed in line with expectations, maintaining revenue and improving margins by 0.3pp to 3.4% in difficult economic conditions.

As in prior years, performance has been mixed. Our Scandinavian, Polish and Portuguese businesses performed well, while Ireland, which represents less than 15% of the portfolio, has yet to see signs of an upturn.

Our Danish business, which employs 359 staff (2009: 335), continues to expand and secured a significant re-signalling design contract extending over 15 years for the Danish European Rail Traffic Management System (ERTMS). This is the first time an advanced system like this has been fitted to an entire country’s strategic rail network and it will set the standard for Europe. We also continue to provide consultancy on the transportation package for the Copenhagen Metro Circle Line.

Our Swedish business is growing and had increased to 142 staff by the year-end (2009: 130 staff).

Our Polish business has extended its workload in the roads sector with its appointment as independent checking engineer and site supervisor for the A2 toll motorway, which extends over 100 kilometres with some 80 bridges.

Difficult economic conditions in Ireland have resulted in projects being delayed and in increasingly competitive pricing. We have continued to reduce the size of our business to match demand, and had 101 staff members (2009: 155 staff members) at the end of the year.

OutlookEurope has secured 51% of budgeted 2010/11 revenue (2009: 42%) and the outlook overall remains good, although we expect parts of our European business to continue to face challenging market conditions.

Our involvement on ERTMS positions us well for further ERTMS work across the UK and Europe over the coming years.

Awarded 15-year Danish European Rail Traffic Management System design contract

For more information visitwww.atkinsglobal.com/win_ertms

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28 Reviews


Management and Project ServicesKey performance indicators 2010 2009 change

Financial metricsRevenue £202.8m £230.0m -11.8% Operating profit £15.9m £18.9m -15.9% Operating margin 7.8% 8.2% -0.4ppWork in hand 44% 44% –PeopleStaff numbers at 31 March 1,991 2,294 -13.2% Average staff numbers 2,094 2,405 -12.9%

Revenue by market Education 14% Oil and gas 14% Industry 8% Financial services 7% Pharmaceutical 7% Commercial buildings 5%

Government buildings 5% Water 4% Energy 4% Health 3% Other 29%


Revenue £m

10

202.

8230.

0

213.

2

193.

6

171.

9

09080706


10

15.9

18.9

13.6

12.813

.9

09080706


10

2,09

42,40

5

2,39

4

2,20

3

2,04

9

09080706


Reviews 29

Appointed by Lloyds Banking Group to provide project management and quantity surveying services

For more information visitwww.fgould.com

Management and Project Services had a good year, despite revenue being down by over 11% on the prior year as we adjusted staff numbers in our Faithful+Gould business to take account of prospective activity levels.

Despite the reduction in revenue our continuing focus on maintaining margins meant that these were close to last year at 7.8% (2009: 8.2%) for the segment as a whole.

Our Faithful+Gould business, which accounts for the majority of the segment’s revenue, provides project management and cost consultancy services in a broad range of market sectors. Our diverse client base and geographic spread has provided resilience in a difficult and highly competitive market over the last year. This has adversely affected volumes in parts of our business and we took early action to reduce headcount by approximately 300 staff across the world.

Faithful+Gould has secured a number of significant projects in the last year, including public sector frameworks such as our appointment in the UK to the

Government’s Buying Solutions Project Management and Design Services framework, and in the USA where we secured a position on a five-year General Services Administration national project management framework with the US Government.

We continue to address the financial services market with a recently secured framework for Lloyds Banking Group providing project management and quantity surveying services, building on existing contracts with RBS and Barclays. We also continue to work in education on the Building Schools for the Future programme and in the utilities market for a number of water companies.

Elsewhere, our Asia Pacific business continues to develop, underpinned by work for global pharmaceutical companies investing in both new and existing facilities in the region.

Our Management Consultants business, which had a very good year, continues to plan, design and deliver programmes that create value through efficiency gains from the implementation of ICT-enabled business change.

Our markets in the UK and internationally cover a diverse base of local government and public sector clients for whom we deliver efficiency improvements through business change. In the capital-intensive private sector we deliver business change, feasibility studies, due diligence and project development plans and methodologies.

OutlookWe are pleased to have maintained our work in hand for the coming year at 44% of budgeted revenue and to have extended our total future work with a number of longer term contracts.

Overall, the outlook for this segment is stable.

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30 Reviews


Asset ManagementKey performance indicators 2010 2009 change

Financial metricsRevenue £56.0m £47.6m +17.6% Operating profit/(loss) £5.0m £(6.8)m +173.5% Operating margin 8.9% (14.3)% 23.2ppProfit on disposal of Joint Venture – £2.5m – Work in hand 73% 99% -26pp People Staff numbers at 31 March 562 671 -16.2% Average staff numbers 613 682 -10.1%

Revenue by market Financial services 24% Health 20% Other buildings 19% Residential buildings 17% Other 20%

Revenue by client type Public sector: local government 9% Public sector: national government 4% Private sector 87%

Revenue £m

10

56.0

47.6

90.9

82.3

61.8

09080706

Operating profit/(loss) £m

10

5.0

-6.8

2.8

2.2

4.5

09080706


10

61368

2

674

669

889

09080706


Reviews 31

Results for the Asset Management segment for 2009/10 were favourably impacted by the exit from one of our long-term legacy PFI maintenance contracts.

The segment’s operating margin increased to 8.9% (2009: -14.3%) principally as a result of the release of residual provisions held on the previously reported poor performing PFI maintenance contract and there was a consequential reduction in headcount following the termination of this contract.

The remainder of the contracts in our managing contractor business are performing in line with expectations.

In our managing agent business we concluded our contract for Barclays Bank during the year, although we continue to win work in the financial services sector. In particular we have secured a five-year contract to deliver helpdesk and managing agent services to Lloyds Banking Group.

OutlookWe remain well placed in both the public and private sectors to continue to help clients lower their cost base. Our work in hand at 31 March 2010 represented 73% of budgeted revenue for 2010/11 (2009: 99%). The reduction reflects the aforementioned contract termination.

For more information about our Asset Management business visit www.atkinsglobal.com/am

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32 Reviews

Business ReviewFinancial performance

Net finance costNet finance cost was £14.6m (2009: net cost of £3.1m). The year on year increase was attributable to a £9.6m increase in the net finance cost on post-employment benefit liabilities and a significant interest-rate driven reduction in the interest receivable on short-term deposits. The net finance cost is expected to stabilise in 2010/11 and remain similar to that reported in 2009/10.

TaxationThe Group’s income tax expense for the year is £19.3m (2009: £18.5m) giving an effective tax rate of 20.0% (2009: 18.0%). The Group’s normalised effective tax rate is 19.8% (2009: 18.5%). The rate is lower than the UK rate (28%) due to continued benefits from research and development tax credits and the proportion of overseas profits earned in jurisdictions with a lower tax rate. The Group expects the effective tax rate to continue to benefit from similar tax credits and territorial profile of profits going forward.

Earnings per share (EPS)Basic EPS for continuing operations was 79.5p (2009: 86.1p). Normalised diluted EPS, which we consider to be a more representative measure of underlying trading and relates to continuing operations, was 77.8p (2009: 82.3p), a decrease of 5.5%.

PensionsFundingThe latest actuarial valuation of the defined benefit Atkins Pension Plan (the Plan) carried out as at 1 April 2007 indicated that the Plan had an actuarial deficit of approximately £215m. Accelerated contributions of £32m were made during the year and the Group has agreed to contribute a further £32m per year for the next four years. The next actuarial valuation will take place as at 1 April 2010 and is likely to be completed in late 2010 or early 2011.

ChargesThe Group accounts for pension costs under IAS 19, Employee benefits. The total charge to the income statement in respect of defined benefit schemes reduced to £13.9m (2009: £14.8m), comprising total service cost of £5.5m (2009: £8.9m); net finance cost of £15.1m (2009: £5.9m) and curtailment and settlement gains of £2.6m and £2.3m (net) respectively. The charge relating to defined contribution schemes increased to £33.5m (2009: £28.2m).

IAS 19 valuation and accounting treatmentThe Group assesses pension scheme funding with reference to actuarial valuations, but for reporting purposes uses IAS 19. Under IAS 19, the Group recognised a much-increased retirement benefit liability of £440.0m at 31 March 2010 (2009: £298.4m) despite a strong performance of the scheme assets. The actuarial loss recognised through the Group’s statement of comprehensive income amounted to £119.7m (2009: £88.5m).

The assumptions used in the IAS 19 valuation are detailed in note 29 to the Financial Statements.

CashNet funds at 31 March 2010 were £302.5m (2009: £234.2m) made up as follows:

2010 2009 £m £m

Cash and cash equivalents 260.3 209.7 Loan notes receivable 21.2 12.9 Financial assets at fair value through profit or loss 32.4 28.7 Borrowings due within one year (0.7) (2.8)Borrowings due after one year – (0.6)Finance leases (10.7) (13.7)Net funds 302.5 234.2

Cash generated from continuing operations was £126.5m (2009: £125.5m), representing 112% of operating profit, and can be summarised as follows:

2010 2009 £m £m

EBITDA 134.0 136.5 Outflow relating to pensions (36.3) (40.6)Movement in working capital 29.6 10.9 Movement in long-term payables 1.9 –Movement in provisions (5.9) 9.2 Other non-cash items 3.2 9.5 126.5 125.5

Operating cash flow remained strong as we continued to optimise the cash position on our contracts. Proactive working capital management resulted in a net working capital inflow of £29.6m which was achieved despite a lengthening of debtor days in the Middle East.

The movement in provisions is mainly due to the one-off release of residual provisions within our Asset Management business.

Net tax paid amounted to £18.0m (2009: £12.8m) which includes payments of £3.5m (2009: £0.4m) to Metronet for consortium relief.


Reviews 33

Net capital expenditure in the year, including the purchase of computer software licences, amounted to £10.8m (2009: £27.6m). The reduction was due to less spending and better utilisation of assets already in use.

No shares were bought back during the year in respect of the share buyback programme (2009: £12.3m).

Capital structureAs at 31 March 2010, the Group had a shareholders’ deficit of £84.9m (2009: £43.5m) and the Company had shareholders’ funds of £136.7m (2009: £108.8m).

The Company had 104.5m fully paid ordinary shares in issue at 31 March 2010 (2009: 104.5m). For further details refer to note 31 to the Financial Statements.

Treasury policies and objectivesThe Group’s treasury function manages and monitors external funding and investment requirements and financial risks in support of the Group’s corporate objectives. The Board reviews and agrees policies and authority levels for treasury activities.

The Group’s financial instruments, other than derivatives, comprise borrowings, cash and liquid resources and various items, such as trade receivables and trade payables, which arise directly from its operations. The main purpose of these financial instruments is to finance the Group’s activities. The Group also enters into derivative transactions, principally forward foreign currency contracts, in order to manage foreign exchange risk on material commercial transactions undertaken in currencies other than the local functional currency. The Group does not trade in financial instruments.

The main risks arising from the Group’s financial instruments are market risk (including foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk, along with the risks

arising from the financing of the Group’s activities in the Public Private Partnership (PPP) and Private Finance Initiative (PFI) sectors. The Group’s exposures to and management of each of these risks, together with sensitivities and risk concentrations, are described in detail in note 2 to the Financial Statements.

The Group funds its ongoing activities through cash generated from its operations and, where necessary, bank borrowings and finance leases. The Group’s banking facilities are described in note 26 to the Financial Statements; utilisation of the facilities mainly relates to letters of credit issued in respect of individual projects undertaken by the Group’s operating businesses. As at 31 March 2010 the Group had £87.0m undrawn committed borrowing facility available (2009: £75.0m).

There have been no significant changes to the Group’s treasury policies during the year.

Critical accounting policiesThe Group’s principal accounting policies are described in note 1 to the Financial Statements. The Financial Statements for the year ended 31 March 2010 have been prepared under International Financial Reporting Standards (IFRS) as adopted by the EU.

The preparation of Financial Statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates. Material estimates applied across the Group’s businesses and Joint Ventures are reviewed to a common standard and adjusted where appropriate to ensure that consistent treatment of similar and related

issues that require judgement is achieved upon consolidation. Any revisions to estimates are recognised prospectively.

The accounting policies and areas that require the most significant estimates and judgements to be used in the preparation of the Financial Statements are in relation to contract accounting and defined benefit pension schemes.

Contract accountingProfit is recognised on contracts on a percentage completion basis, provided the outcome of the project can be reasonably foreseen. Full provision is made for estimated losses. Where contracts span more than two accounting periods profit is not generally recognised until the project is 50% complete.

The projected outcome of any given contract is necessarily based on estimates of revenues and costs to completion. Whilst the assumptions made are based on professional judgements, subsequent events may mean that estimates calculated prove inaccurate, with a consequent effect on the reporting of results.

Defined benefit pension schemesAccounting for pensions involves judgement about uncertain events in the future such as inflation, salary levels at retirement, longevity rates, rates of return on plan assets and discount rates. Assumptions in respect of pensions and post-retirement benefits are set after consultation with independent qualified actuaries. Management believes the assumptions are appropriate. However, a change in the assumptions used would impact the Group’s results and net assets. Any differences between the assumptions and the actual outcome will affect results in future years. An estimate of the sensitivity is disclosed in note 29 to the Financial Statements.

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Risk Mitigation

CompetitionThe Group faces competition in all of its markets. Some of the markets in which we operate serve a limited number of clients and barriers to entry are high. In other markets, such as architectural design and environment, there are numerous competitors and barriers to entry are lower.

To ensure that the Group continues to win work, we work hard to develop long-term relationships with our clients. We have also taken measures to reduce our cost base to ensure that we remain competitive. In addition, our robust processes for monitoring bidding activity seek to ensure that Atkins bids reflect the competitive environment in which we are working and that the contracts deliver appropriate returns. A measure of this success is our work in hand; this measures our secured workload over the coming year. Our overall work in hand is 54%, representing over six months of 2010/11 revenue that is already contractually committed.

See pages 18 to 31 for our segmental performance

Changes to the contracting environment The contracting environment in which we operate continues to evolve. Clients increasingly seek to transfer risk to consultants; contractors will also seek to share risks. There is a possibility that, in securing new work, the Group accepts risks that are insufficiently understood or evaluated, with ensuing financial loss.

We actively mitigate this risk via a range of internal review procedures that enable contract terms to be subject to appropriate scrutiny and manageable risks to be reduced. Our service delivery process, which forms an important internal control within our governance framework, is continually enhanced to address these issues.

See page 60 for more information about our governance framework

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Business ReviewPrincipal risks and uncertainties

We have a number of potential risks and uncertainties which could have a material impact on our long-term performance. To enable us to deliver value to all stakeholders we endeavour to mitigate these risks where possible.

Effective risk management is embedded into our governance framework, which is explained in the Corporate Governance Report. >


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Risk Mitigation

Matching staffing levels to workloadThe Group balances staff resources against workload to control the level of non-productive time. In an economic downturn there is a risk that there is insufficient work to match current resources.

This risk is managed by working in a diverse portfolio of sectors and markets, and by the redeployment of staff from those parts of the business where the workload is reducing to other parts of the business where the workload is strong. Productivity is a key internal measure and is constantly monitored across the Group, with selective restructuring and headcount reduction undertaken as necessary. This approach has been successfully implemented during the last year to maintain levels of productivity.


Project managementManaging clients’ and our own projects is core to our business. Inadequate project management skills could lead to financial loss and reputational damage.

The Group mitigates these risks via the internal controls within our governance framework, ongoing training, knowledge-sharing and selective recruitment.

PensionsThe Group’s defined benefit pension funds have a material deficit. The Group has previously agreed measures to reduce this deficit; however the deficit is exposed to the risk of changes in interest rates and asset values, as well as inflation and the life expectancy of the members.

The Group’s defined benefit pension funds are closed to new members. Future accruals ceased in October 2007. The Group actively monitors the funds position, taking professional actuarial advice, assessing liabilities, and is implementing inflation swaps to reduce future volatility. The next actuarial valuation is under way, following which the Group will agree appropriate contributions into the fund to reduce the deficit over an agreed period of time.

See pages 107 to 114 for note 29 to the Financial Statements

Market position and reputationOur reputation for delivering complex projects relies on the perception of our clients and how the Group is portrayed publicly. There is a risk that a major failure from poor design, poor project management or delivery could impact our ability to win future work.

We mitigate this risk by ensuring our governance framework includes robust cost, project management and other internal controls. These are subject to regular independent audit against industry standards.

See page 60 for more information about our governance framework

Health, safety and the environment The Group’s business is concerned with the built environment and this entails significant health, safety and environmental risks. Should the Group’s policy or practice in this area prove inadequate, there is a consequent risk to employees, clients, contractors and third parties and also a risk of reputational damage to the Group.

The Group takes these issues very seriously, and ensures all staff are adequately trained in health, safety and environmental issues; indeed we lead our sector on health and safety matters. Procedures in this area are central to our governance framework and are continually reviewed and improved. We also undertake regular independent audits against industry standards.

See pages 42 to 50 for our Corporate Responsibility Review

Data securityThere is a risk that Atkins might mishandle client, commercial or staff data. Such an event could expose the Group financially and have a significant impact on our reputation.

Data security is taken very seriously, and we have in place procedures on how to handle clients’ and staff data, including the use of secure networks and encryption. Appropriate building security is in place to protect confidential data, and offsite storage of client data and use of cyber protection of both hardware and software applications have been implemented. In addition, training our staff so that they understand their responsibilities is an important mitigating measure.

Recruitment and retention of sufficient high-calibre staffThe recruitment and retention of the best people is crucial to our future success. Failure to do so would constrain the growth of the business and prevent us from delivering our strategy.

The Group expends a great deal of management effort and resource in this area, and further details of our staff controls are given in the Human Resources Review and Corporate Governance Report.


Crisis eventA crisis event at an Atkins site or one affecting staff could lead to loss of staff or interruption to service delivery.

The Group’s business continuity strategy requires business continuity plans (BCPs) for all major global offices. Staff awareness and testing of BCPs is a key mitigating measure, and the resilience of our back-up systems for IT infrastructure is regularly tested.

Global political, economic, legal and regulatory risksAtkins works in selected countries around the world, potentially exposing the Group to political, economic, legal and regulatory risks. Political instability could threaten our operations, an economic slowdown could have an adverse impact on workload for both our private and public sector clients, and the Group could fail to adequately address legal and regulatory risks in unfamiliar jurisdictions.

The Group mitigates these risks by monitoring economic indicators and sentiments in the markets in which we operate, as well as maintaining a strong balance sheet, working in a diverse portfolio of business sectors and markets and by building flexibility into future plans. We look to remain cash-positive on projects and negotiate commercially favourable payment terms on contracts. Our service delivery process seeks to identify legal and regulatory risks during bidding and through the lifecycle of projects.

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Human Resources ReviewOur people

Our success depends on our ability to attract and retain the most talented professionals in their respective fields and to provide an environment in which they are able to apply their skills and experience in addressing our clients’ varied needs. >


OverviewAs a professional services organisation, remaining an employer of choice is a prerequisite for our success. Achieving this depends on our ability to attract and retain the most talented professionals in their respective fields and to provide an environment in which they are able to apply their skills and experience in addressing our clients’ varied needs.

Our people performance is evaluated alongside other aspects of performance (financial, technical, safety and client engagement) during monthly, quarterly and annual business reviews. This evaluation involves tracking a range of metrics for headcount growth, retention, stability and employee engagement alongside reviews of the skills and capabilities of our people against an assessment of the future needs of the business. We also take note of the results of internal and external surveys.

Whilst 2009/10 was a very difficult year for many of our staff, with significant headcount reduction particularly in the first half of the year, we have worked hard both to maintain a positive employment environment and to continue to develop the skills of individuals and the capabilities of the organisation as a whole. Our performance is summarised in the sections below.

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The level of staff reductions was significantly lower in the fourth quarter and we remain confident that overall headcount has now stabilised and will begin to increase from the half-year onwards. We recognise that many colleagues have been affected by these reductions and we have worked to alleviate the impact wherever possible. Most importantly we have endeavoured to redeploy those affected to vacancies elsewhere in the Group. Where this has not been possible, due to a mismatch of either skills or geography, we have provided those leaving the Group with outplacement support. Nevertheless, the impact has been significant for many former colleagues and it is sadly the case that career opportunities in the wider market remain very limited for those in certain professions.

Whilst vacancy levels across the Group remained substantially below those seen in recent years, our recruitment performance was good with 1,228 new staff joining during the year: 1,129 via open recruitment and 99 via TUPE transfer.

HeadcountHeadcount reduced in-year from 18,017 on 1 April 2009 to 15,601 by the year-end, a fall of 13%. Of this, approximately 600 people were already under notice at the start of the year, giving an in-year reduction of 1,816 staff from an adjusted opening headcount of approximately 17,400, a reduction of 10% (see Figure 1).

The overall reduction in headcount masked strong performance in several businesses, notably in the energy business which saw growth driven by our continued successes in the nuclear, oil and gas and renewable markets, but was affected in particular by:

headcount reduction in the Middle East •in anticipation of lower activityrestructuring in our water business•a general reduction in headcount in most •other parts of the business as we sought to improve efficiency.

16,000

15,500

16,500

17,000

17,500

18,000

18,500

Figure 1: Headcount 2009/10

Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar

Period end 2009/10 averageAdjusted for under notice at year-end

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We maintained our commitment to graduate development, albeit with a substantially reduced intake of 105 trainees (2008/09: 150). Our credentials as a graduate recruiter in the UK were underlined by an improved ranking to 37th place in the Times Top 100 Graduate Employers (up from 69th in 2008) and our success in being named Most Popular Recruiter in the Construction and Civil Engineering category at the Target National Graduate Awards for the fifth year. This award is the largest graduate recruitment survey in the UK with feedback gathered through an online campus survey of 90,000 undergraduates over a four-month period ending in January each year.

We were also pleased to be recognised at the UK’s Recruiter Awards as Best Recruitment Team.

We also monitor the stability of our workforce using a stability index (the number of staff with more than one year’s service at the end of the financial year as a percentage of the headcount at the beginning of the financial year).

The stability index for the Group was 80.6% (2009: 84.3%). The indices for the individual regions were as follows: UK 85.8% (2009: 82.7%), Middle East 65.1% (2009: 76.9%), China 74.1% (2009: 75.3%), Europe 80.5% (2009: 87.4%) and USA 78.8% (2009: 81.5%).

We continue to use a third-party consultant to receive and report independently on feedback from those employees who voluntarily leave the Group. It is encouraging to see that over 80% of those who completed the questionnaire said that they would both consider coming back to work at Atkins and would recommend Atkins as a place to work. Compared to last year, fewer leavers have expressed dissatisfaction with either their job or Atkins as the primary reason for leaving.

RetentionStaff turnover was at a record low during the year. Whilst to a large extent this reflected wider market conditions, our relative performance against our peers gives us confidence that it also reflected our credentials as an employer of choice. Turnover by region was as follows:

2010 2009 Business area Turnover Turnover

UK 6.5% 10.0%Middle East 15.6% 14.7%China 16.1% 17.9%USA 9.0% 10.2%Europe 6.2% 8.9%Atkins 8.6% 11.4%

As shown above, performance improved significantly in the UK, Europe, USA and China. The only area where performance remained relatively unchanged was the Middle East where for a period there was a general loss of confidence in the region affecting all organisations. We continue to monitor retention trends closely.

Human Resources ReviewOur peoplecontinued


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Employee engagementWe continued to invest in internal communications during the year, mindful that maintaining a proactive, two-way exchange of information with staff is critical to maintain staff support, understanding and motivation during a period of economic uncertainty when colleagues are saying goodbye to their friends and, in many areas of the Group, are experiencing pay freezes. The first half of the year saw an increased appetite for the consumption of news and information about the Group, particularly through audiovisual channels. However, towards the year-end we experienced a slight dip in penetration figures for our internal communications channels, which shows us we have to work harder to maintain staff engagement.

Against this background and in addition to internal communications activities which focused on exchanging and broadcasting information about our vision, values and strategy to colleagues, we stepped up our programme of employee engagement to ensure that colleagues understand what actions are being taken to enable us to remain successful and the role they play in contributing to this.

Investment in peopleWe continue to place considerable emphasis on developing the skills and capabilities of our people. Whilst training spend was down on previous years, there has been an annual training investment of £16.7m during the year and through careful prioritisation we have been able to maintain investment in those areas of greatest importance.

Our suite of client relationship skills and project management courses has been modernised and improved. Importantly, as part of these improvements, the knowledge and skills associated with engaging with clients on carbon critical design have been added and embedded into the content of the courses.

During the year a new Group-wide career development framework was successfully launched. This framework brings greater clarity on how to navigate a career path in Atkins, and reinforces the fact that the Company can provide interesting and rewarding careers to individuals whether their contribution has a technical, project management or business management bias.

For the past seven years, we have conducted an annual survey across the Group (called ‘Viewpoint’) to measure employee engagement. During this time, we have used the survey to measure our performance against a stable set of indicators, thus providing excellent data on both our absolute and relative performance as a Group and within and between businesses and regions. This has proved invaluable in allowing us to highlight areas of good practice and areas where we may be falling short of our high expectations.

The latest survey was conducted in April/May 2010 and so provides an up-to-date assessment of our performance. The survey is open to all our staff worldwide and can be completed in several different languages. Overall 76% of staff completed the survey with a reduction in the Employee Engagement Index (EEI) from 75 to 73. Whilst this only takes the EEI back to the same level as 2008, it is disappointing and provides several useful pointers as to where we need to do better.

Similarly, we were disappointed for the first time in six years to drop out of the Sunday Times Top 20 Best Big Companies to Work For ranking. Having reviewed the results in detail, we have concluded that this was as a result of several factors, most particularly our failure to explain sufficiently well the context within which we have had to take a number of hard decisions in relation to redundancies, pay awards and cost reduction. We have recognised the need to engage staff at every level on these issues, not simply those in senior management roles.

Improved ranking to 37th place in the Times Top 100 Graduate Employers (up from 69th in 2008)

Most popular recruiter in the construction and civil engineering category at the Target National Graduate Awards for the fifth year

For more information visitwww.atkinsglobal.com/graduates

For more information visitwww.targetjobsawards.co.uk

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There has been a focus on engaging more with talent and talent management at all levels: management development centres, development dialogue and the senior management development programme are proving to be vital tools through which we identify, engage and develop talent at middle and senior levels (250 individuals participated in 2009/10). We also continue to invest in people management skills with 1,300 managers attending our portfolio of courses dedicated to this.

Improvements have been made to the systems, processes and resources dedicated to supporting learning and development. The combination of improvements to our learning management system and the establishment of a central learning and development centre of expertise will enable better visibility and access to our training courses, more robust reporting, tighter management of training costs and closer alignment of training activity with business needs.

The priority for graduate development this year has been to improve communication with the graduate community. This was achieved through various means, including a redesign of our graduate intranet site, regular intranet articles congratulating those who have achieved chartered status or professional qualifications, and an increase in email updates and stakeholder presentations about the graduate development programme.

RewardAs announced a year ago, we took a decision to defer the April pay review until October 2009, when a full review was undertaken. As a result, salaries increased in the few market sectors experiencing upward pay movement but remained broadly flat for much of the Group.

The April 2010 pay review was conducted within the context of strong business performance in some of our businesses, but continuing challenging market conditions in others. Overall pay levels rose by 2% across the Group, with increases appropriately targeted to respond to significant pay pressure in some areas without affecting competitiveness in those sectors of the market where salaries at best remain flat. As a result, 55% of staff received an increase.

The executive bonus scheme, which covers approximately 850 senior staff, provides the opportunity to increase pay to the upper quartile for the sector by meeting demanding financial and personal targets. In addition, many senior staff also receive an annual share award, providing an incentive to deliver sustained long-term performance.

A discretionary bonus scheme covers the wider Atkins population and pays a bonus to approximately 30% of staff in each year, recognising individual contribution and performance.

In 2009 Atkins achieved accreditation for its employer-managed further learning programme from the Joint Board of Moderators. The programme enables bachelor-level graduates to gain the necessary training to achieve chartership, and represents a valuable offering to our graduate recruits. This programme is being formally launched during 2010.

Technical excellence is a strategic imperative for Atkins and we continue to invest in the technical networks established 18 months ago to join up skills embedded in our market-facing businesses. The networks perform an important governance function for our technical work and provide a focus for improving our skills, design methodologies and tools. Through the networks, we have effectively trained staff to design using the new Eurocodes which were introduced from April 2010. The success of the first tranche of networks has encouraged us to launch recently a further three networks.

Strategic relationships with universities continue to enable us to access emerging thinking and technologies of relevance to our markets. We continue to deliver modules on undergraduate and postgraduate teaching programmes and to mentor research projects, which enable us to build strong relationships with students and raise Atkins’ profile as a desirable company to work for.

Human Resources ReviewOur peoplecontinued


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We continue to work closely with the Trustees of the Group’s defined benefit pension schemes to ensure that the schemes are appropriately funded and that liabilities are managed effectively. A change was implemented for the members of the Atkins section of the Rail Pension Scheme which has allowed members who wish to do so to choose a lower-cost option in exchange for a cap on final pensionable salary.

We have sought to strengthen further the Board of Trustees for the Atkins Pension Plan, the largest scheme within the Group, to increase its investment expertise, and we have already commenced a dialogue with the Board regarding the 2010 triennial valuation.

We were delighted to achieve the National Association of Pension Funds’ quality mark for the defined contribution section of the Atkins Pension Plan. This confirms that the Plan is considered competitive with respect to Company contribution levels and is managed and administered to a high standard of governance.

DiversityIt is essential that we attract, retain and develop talented individuals who reflect the diverse nature of the areas in which we work. Success in this regard is critical for us in order to build a balanced workforce to meet our clients’ needs, to broaden our skills base and to address a growing skills deficit in the science and engineering disciplines.

In July 2009, Keith Clarke, as chairman of the Construction Industry Council (CIC), delivered a diversity report that rallied the industry to unite and increase representation of women and ethnic groups. We are now able to show that over the past five years we have seen an increase in the number of women in both managerial and senior technical and professional roles in Atkins.

Gender diversity is visible through our external work with organisations, industry bodies and clients to promote greater participation, particularly by women, in the science, engineering and technology (SET) sectors. All business Board directors have received formal training around diversity and discrimination awareness, which is being cascaded to their teams. Employees can also access an online training module on practical steps they can take to promote equal opportunities.

Alun Griffiths, Group HR director, continues to chair the Industry Board of the UK Resource Centre, the Government’s lead organisation for the provision of advice, support and policy consultation regarding the under-representation of women in science, engineering, technology and the built environment.

Our work to encourage young people into engineering is supported by strong links with schools and colleges, and by our sponsorship of Insite magazine, which is distributed to schools and young engineers’ clubs. We have more than 100 engineers acting as ambassadors for STEMNET (Science, Technology, Engineering and Mathematics Network), promoting engineering in schools and attending after-school clubs to provide a snapshot of life as an engineer. HR modernisationWe have made significant progress during the year with the implementation of our HR modernisation programme, one of several business improvement initiatives for the Group. The objective of this is to improve the accessibility of services for our people whilst streamlining the HR service for the organisation. Via the implementation of new technology and transition to a new operating model, we have been able to reduce the costs of HR by over 25% whilst increasing value to the organisation. A particular priority is to increase the focus on resource planning to ensure that we plan, develop and retain the skills and resources necessary to meet our future needs.

More than 100 Atkins engineers act as ambassadors for STEMNET

For more information visitwww.stemnet.org.uk

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We are committed to acting responsibly towards all our stakeholders and to taking a leadership position within our sector.

Our corporate responsibility beliefs and performance align to our strategic imperatives and are in accordance with our policies on safety leadership, carbon reduction, respect for the environment, excellence in delivery and working with our community. >

For more information visitwww.atkinsglobal.com/cr

Corporate Responsibility Review


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We are committed to acting responsibly towards all our stakeholders and to taking a leadership position within our sector. We publish additional information about our performance on our website (www.atkinsglobal.com/cr). We also summarise this year’s activities on this site. Our Corporate Responsibility Review is structured this year in accordance with our policies on safety leadership, carbon reduction, respect for the environment, excellence in delivery and working with our community. Information relating to our people can be found in the Human Resources Review on pages 36 to 41 and information on corporate responsibility governance and business conduct can be found in the Corporate Governance Report (on pages 58 to 64). A resolution to approve this report will be proposed at the Company’s Annual General Meeting. Whilst only advisory, this resolution will enable us to obtain feedback from shareholders on our performance in this area.

Safety leadershipAtkins remains committed to health and safety improvement beyond that required by law. Our chief executive was the chair of the Construction Industry Council (CIC) and during the year we continued to work with industry through national forums such as the Strategic Health and Safety Forum, the CIC Safety Committee, and the Consultants’ Health and Safety Forum.

Last year we reported that our Highways and Transportation business had set an industry standard for designing out risks in projects. This standard has now also been adopted by the UK Government’s Environment Agency and continues to be promoted across the industry.

We continue to improve safety leadership within Atkins. Our newly appointed chairman and Group finance director both undertook the Construction Skills Certification Scheme (CSCS) Managerial and Professional safety test and Group managing directors attended our safety

leadership course. The Rail business developed the ‘Safe by Choice’ behavioural programme, and has seen a reduction in serious accidents. This programme has received positive feedback from the attendees of the Network Rail supplier conference, and has now also been implemented in our Highways and Transportation business.

Atkins’ safety, health and environment (SHE) culture survey was extended to our non-UK businesses. Some 8,500 staff responded to the survey, including the UK version, last year. The results showed that a positive safety and environment culture exists within Atkins but that there remains some variation between the businesses.

Figure 1: Accident incidence rate (AIR) Office Engineering Construction

HSE Labour Force Survey1 280 400 2,040Atkins’ benchmark (for staff or contractors) 139 287 1,445

Staff2009/10 35 114 1,4082008/09 89 147 1,8332007/08 38 178 1,0422006/07 12 65 9952005/06 104 151 5562004/05 59 235 2,763

Contractors2009/10 259 45 6682008/09 132 0 6192007/08 0 0 7082006/07 382 441 1,2212005/06 0 124 2932004/05 0 124 317

(AIR = number of accidents per 100,000 staff or contractors).

1. HSE Labour Force Survey results are the three-year average results for different occupations: administrative and secretarial for Office, science and technology for Engineering, and construction trades for Construction.


See pages 58 to 64 for our Corporate Governance Report

See page 14 for our strategic imperatives

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Corporate Responsibility Reviewcontinued

Our safety performanceAtkins reports accidents and incidents for staff, contractors and Joint Ventures, and in situations where we are principal contractor. The accident incidence rate (AIR) is used to measure accident performance for staff and contractors. Atkins sets its own challenging AIR benchmarks based on a reduction from the previous year of 5% for office staff and 10% for engineering staff. For construction the 2009/10 target remained unchanged. The AIR benchmarks (number of accidents per 100,000 staff or contractors) for 2010/11 are 139 for office, 287 for engineering and 1,445 for construction activities.

Last year overall performance was within Atkins AIR benchmarks with the exception of contractors in the office category, where one reportable accident was recorded. For staff we are pleased to report the AIR decreased across all three categories, reflecting the continued effort to improve safety, including raising awareness of manual handling and display screen equipment through the launch of specialist e-learning modules during European Week of Safety, and the Group-wide safety leadership programme.

Our AIR performance continues to be better than industry performance as compiled by the Health and Safety Executive in its Labour Force Survey (see Figure 1). We have actively encouraged the reporting of incidents and near misses as a positive step towards accident prevention. This year 1,227 near misses were reported compared to 1,172 in 2009.

All our operations are covered by OHSAS 18001 and we have achieved certification to the revised standard OHSAS 18001:2007.

We achieved a Group-level Royal Society for the Prevention of Accidents (RoSPA) Gold award for the first time. In addition, our Highways and Transportation business received a Gold award for the fifth consecutive year and our Asset Management business achieved an Order of Distinction for the 23rd year running.

Regulatory activity During the year, we recorded five visits by enforcement authorities. We have not been prosecuted for any breaches of health and safety regulations.

Our safety target

Aim/target Monitoring Indicator Baseline

Measure Atkins safety culture

SHE Culture Survey The use of four dimensions of Atkins safety culture – management commitment, staff engagement, training and competence, and communication

Nov 2008 – Jan 2010 surveys

Progress summary

Improvements were made to the SHE Culture Survey originally undertaken in the UK •(November 2008)

The revised SHE Culture Survey was piloted at a location within the Middle East •business in May 2009

The remainder of the non-UK businesses undertook the survey between •December 2009 and January 2010, with over 2,100 staff responding

UK businesses are to undertake the revised survey in October 2010, as part of •European Week of Safety.


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Carbon reductionCarbon critical designAtkins began its carbon critical design awareness programme in 2008 with two aims: to encourage senior managers to engage their teams in the role engineers will have to play to deliver a low-carbon economy, and to promote the transfer of knowledge within the business. Building on that activity we are now focusing on improving levels of client engagement, and to this end have invested more than £1m in the development of a suite of carbon tools, which were launched towards the end of 2009. These tools are designed to help organisations make decisions on how to reduce embodied and operational carbon and thus to influence designs.

The tools, outlined below, fall into two categories: generic tools that can be used by any part of the organisation, and market-specific tools.

objectives, approach and progress on carbon critical design. The review recognised that our internal learning on carbon is the most comprehensive that has been encountered, with extensive training undertaken and an impressive range and quality of tools developed around carbon critical design. The review also stated that the level of client engagement was hugely encouraging whilst recognising that the future focus of the programme will need to be weighted more towards outcomes than processes.

Atkins has continued to engage with an ever-greater number of clients on carbon critical design, resulting in more exemplar projects which can be viewed on our website (www.atkinsglobal.com).

These tools are now being shared with industry to encourage greater collaboration with governments, clients and professional institutions and to help stimulate development and knowledge on the carbon agenda.

Through our chief executive’s position as chair of the Construction Industry Council in 2009/10 we engaged closely with the UK Government on how its Low Carbon Transition Plan can be delivered within the UK. Atkins has also been central to the establishment and delivery of the Construction Innovation and Growth Team (CIGT) which is focusing on the delivery of a low-carbon construction industry for the UK.

Atkins engaged the consultancy Forum for the Future, and specifically Jonathon Porritt, to provide an independent review of our

Achieved a Group-level RoSPA Gold award for occupational health and safety

For more information visitwww.rospa.com

Carbon tool Description

Gen

eric

Carbon Critical Knowledgebase

A next-generation carbon calculation and reporting tool that can be used as both an accounting tool and an optioneering tool

Carbon Critical Roadmap

A web-based tool to help express business activities in terms of carbon

Carbon Critical Relativity

A tool that presents a graphical overview of the link between carbon determinants and the carbon they produce or save

Mar

ket s

peci

fic

Carbon Critical Masterplanning

A tool aimed at systematic identification and quantification of the carbon impacts of development masterplans

Atkins Remote Technology (ArT)

ArT is an innovative, web-based energy management system

Carbon Critical Buildings

Three tools related to carbon critical building design: ‘C-rating’, ‘Tool for the Tools’ and ‘Carbon Curves’

Carbon Critical Travel Behaviours

A collection of tools to help encourage the use of low-carbon transport options

Carbon Critical Traffic Analysis

A tool which turns collected traffic data into estimates of carbon emissions

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Our carbon performance We achieved the Carbon Trust Standard for our UK operations and believe we are the first organisation in the design engineering consultancy sector to do so. The standard is awarded to organisations for measuring, managing and genuinely reducing their carbon emissions and committing to reducing them year on year. Over a three-year review period we reduced our emissions from energy use and company vehicles by 11.5%. We now plan to extend the scope of the standard to cover our non-UK operations in 2011.

In 2009 we were rated in the top ten of FTSE 350 companies for the performance element of the Carbon Disclosure Project (CDP). The performance section recognises companies that effectively manage and share carbon data; make the most of climate change opportunities and create solutions to manage risks; engage with climate change policymakers and work towards reducing their own carbon footprint. Our overall reporting score for the CDP also placed us in the top 75 of the FTSE 350 companies.

Our carbon emissionsWe are now able to report on our energy consumption for all of our operations in China, Europe, the Middle East, the UK and the USA. We consume gas, electricity and diesel in our own operations. Figures 2 and 3 show the average emissions per employee and the total emissions for each region.

Worldwide, we emitted 19,774 tonnes of CO2 from energy consumption. Carbon emissions from energy use in our Middle East business have increased due to the inclusion of our Global Design Centre in Bangalore and more accurate data on diesel consumption in the Middle East.

In China our carbon emissions have reduced by 168 tonnes due to lower reported energy consumption in our offices. Emissions in Europe have also reduced despite the inclusion of Poland for the first time. This is also the first time that we have been able to report on carbon emissions from energy consumption for our operations in the USA.

In October 2009 we launched our Raising Awareness Cutting Energy (RACE) campaign to raise awareness and cut energy consumption in our property portfolio by 12.5% by March 2011. The campaign is focused at an individual property level to encourage all employees to play their part in reducing consumption by establishing a positive energy culture. More than 50 of our locations are participating and more than 5,700 employees have completed the e-learning training modules that we have created on energy management.

We have also pledged to HRH The Prince of Wales’ May Day Network that we will publish our carbon footprint and we have committed to reducing our carbon emissions by 10% in 2010 as part of the 10:10 campaign. As of April 2010 we are participating in the Carbon Reduction Energy Efficiency Scheme in the UK.To facilitate these reductions remote energy metering was installed at nine new locations during the year, meaning that 14 of our key UK properties now have the system installed. There were immediate results as significant reductions in both gas and electricity consumption were identified and implemented at those locations. The system has been complemented by the installation of our own Atkins Remote Technology (ArT) system at 11 properties.

Figure 2: Tonnes of CO2 per employee from energy consumption

Europe

Middle East

UK

USA

China

0 0.5 1 1.5 2 2.5 3

Figure 3: Total emissions Total 2009/10 CO2 emissions from CO2 emissions from emissions Source energy consumption (tonnes) business travel (tonnes) (tonnes)

Region Gas Electricity Diesel Road Air Rail

China 0 600 0 33 861 0 1,494Europe 25 642 0 247 144 30 1,088Middle East 0 3,392 278 341 424 0 4,435UK 2,292 11,968 4 12,824 3,694 1,321 32,103USA 0 573 0 n/a 533 n/a 1,106


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Atkins has won multiple recognition for its carbon reduction drive

Committed to reducing our carbon emissions by 10% in 2010

For more information visitwww.atkinsglobal.com/awards_carbon

For more information visitwww.1010uk.org

The calculation for CO2 emissions from our energy consumption is made using the latest published DEFRA figures for electricity in the UK and for gas in the UK and Ireland. We use the five-year average from the latest published Greenhouse Gas Protocol figures for each country other than the UK for electricity. Where data does not exist we extrapolate known consumption data in the region to include the remaining locations.

We are now also able to report on business travel emissions for all of our operations. Our business travel data covers: all road, air and rail travel for the UK; company car, air and rail travel for Europe and India; company car and air travel for China, and air travel for the USA. Our business travel emissions from road and air for the Middle East business account for approximately 60% of our operations in that region. Our worldwide CO2 equivalent emissions associated with business travel were 20,452 tonnes.

In the UK our carbon emissions from business travel decreased by 15.9% from 21,201 equivalent tonnes CO2 in 2008/09 to 17,839 tonnes of CO2 in 2009/10. This is against a backdrop of a 7.9% decrease in average headcount over the same period.

In the USA we flew 43% fewer business miles than the previous year, reducing our CO2 equivalent emissions by 398 tonnes. In China emissions from business travel by air decreased by 5.3% whilst more accurate data led to a slight increase in emissions from road travel. In Europe emissions from air travel increased slightly with the inclusion of Poland in our reporting whilst emissions from road travel increased significantly with extra data now available from Denmark and Poland.

The calculation for CO2 equivalent emissions from our business travel is made using the latest published DEFRA figures

Figure 4: Company car fleet emissions (UK average)

A-M UK Vehicle Exercise Duty (VED) bands.

Fleet average 148

<100 A

101-110 B111-120 C

121-130 D131-140 E

141-150 F151-165 G

166-175 H176-185 I

186-200 J201-225 K

CO

2 em

issi

on

s (g

/km

)

L226-255M256+

for road and air travel, the DEFRA figures for rail travel in the UK and the US Intercity rail emissions figure for non-UK rail travel in the absence of valid country-specific information. The calculations include the conversion of other greenhouse gases into carbon emissions. The numbers reported for 2008/09 have been revised due to changing DEFRA emissions factors to enable better year-on-year comparison.In the UK a financial incentive to encourage employees to choose lower-emitting company car vehicles was introduced in 2009. The average carbon emissions of our UK company car fleet of 1,500 vehicles has reduced to 148g/km (2009: 154g/km). See Figure 4.

Our carbon target


Reduce energy consumption by 12.5% between October 2009 and March 2011

Energy consumption data

Total consumption of gas and electricity

Annual consumption up to October 2009

Progress summary

RACE launched to worldwide operations in October 2009•RACE e-learning modules made available to staff in October 2009; 5,750 staff •completed the modules by March 2010More than 50 locations worldwide already participating in RACE.•

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Respect for the environmentWe are committed to conducting business in an environmentally responsible manner. All of our operations worldwide are covered by the ISO 14001 standard. We have summarised here our activities on waste reduction, water efficiency and regulatory activity.

We extended the safety, health and environment (SHE) Culture Survey to our non-UK businesses as referred to in the Safety Leadership section. This was the first time that we had surveyed our employees on environmental issues outside our UK operations.

Waste reduction In September 2009 we signed up to the WRAP (Waste and Resources Action Programme) Halving Waste to Landfill commitment in the UK. We aim to achieve this target by 2012 by embedding the principles of designing out waste into our processes. Since signing up we have engaged project managers and designers on key design issues and applied the principles to several pilot projects to help establish baseline data on waste.

Water reduction We appreciate that water is a limited resource around the world and we work with clients to develop water-efficient solutions. We have worked on projects such as rainwater harvesting in East Anglia, UK; Northwood Primary School in Darlington, UK; and water supply and sanitation in Nigeria.

Our water performance Because we lease the majority of our properties, as with waste it is difficult to obtain relevant water consumption data for these locations. We are able to monitor consumption at locations in the Middle East, Bangalore, Ireland, Poland, Portugal and in the UK covering approximately 30% of our employees.

We have introduced waterless vehicle cleaning for some operations to reduce the amount of water that we consume.

Regulatory activityIn the last year we received four visits from the Environment Agency. We received a warning letter, as did our client and a contractor, due to a problem with waste management on one project site. No other enforcement action was taken during the year and we have not been prosecuted for any breaches of environmental legislation.

Waste management was a key consideration in our Derby office’s relocation last year. Waste was kept to a minimum wherever possible during the project with 90% of construction waste recycled and items returned to manufacturers and suppliers for recycling. New desks purchased for the office are 99% recyclable and the fabrics used on the chairs were made from 100% recycled material.

Our waste performance We continue to improve and refine our waste management facilities. As we lease the majority of our properties it is very difficult to obtain accurate waste data for all of our operations. However we are able to report on waste and recycling for a number of key UK properties that account for approximately 35% of our UK staff. Through these locations 40% of the waste is recycled. In Sweden we continue to divert 100% of waste away from landfill through recycling or conversion to energy. In China we recycled 65% of our waste and introduced a new recycling system into our Shenzhen office. Our operations in Ireland and Poland recycled 24% of their waste.

In the UK we have piloted composting of food waste at our Epsom and Bristol offices. The scheme has proved very successful with almost eight tonnes of food waste diverted from landfill. The compost generated is used for regeneration projects in London.

Our environmental target


Halve waste sent to landfill through our UK projects by 2012

Quarterly review with businesses

Levels of waste avoidance and amounts diverted away from landfill

2010 data

Progress summary

Workshop to introduce key design principles in September 2009•Key design principles embedded in pilot projects across the business.•


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Excellence in delivery Following a business review of how we operate we have developed a business improvement programme to enable us to win significantly more work and deliver it more profitably. The programme covers key items such as client engagement and project excellence. As part of the programme we are working towards adoption of a common business management system (BMS) to enable us to implement a more consistent approach to common processes.

To help us deliver technical excellence consistently we have created 14 technical networks across the Group. These networks are chaired by our most respected specialists who provide leadership in their appointed subject or discipline, identify investment opportunities, and raise the profile of Atkins on technical expertise.

We continue to deliver complex exemplar projects, details of which can be viewed on our website.

All our businesses are required to make the transition to the revised standard of ISO 9001 by November 2010. The assessment programme, run by our certification body Lloyd’s Register Quality Assurance, began last year. So far 80% of the Group has achieved approval against the new standard.

Supply chain We recognise that our supply chain plays a significant part in delivering successful projects. For this reason we have developed a supply chain sustainability commitment to help us engage our suppliers on important economic, social and environmental factors.

The principles were applied to the Derby office move that was undertaken during the last year. Local suppliers were used extensively in the project, equating to 70% of the contract value; site safety was paramount, with all site workers required to have the Construction Skills Certification Scheme card; and minibuses were used to move workers to and from the site to reduce carbon emissions and vehicle movements around the area. The plan is now to embed the sustainability commitment within the supply chains of each business through a pan-business procurement forum.

We have also created a supply chain knowledge centre for our Highways and Transportation and Rail businesses. This provides extensive management information on supplier capability, pre-qualification status, and performance. This assists Highways and Transportation and Rail with their more stringent supplier requirements and enables them to provide the necessary assurance for clients.

Our excellence in delivery target


Embed supply chain sustainability commitment within individual business supply chains

Supply chain reviews

Number of suppliers delivering on the commitment

n/a

Progress summary

Commitment agreed with all business managing directors•Engaged corporate-level suppliers to deliver on the commitment.•

We have signed up to the WRAP Halving Waste to Landfill commitment in the UK

For more information visitwww.wrap.org.uk

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Working with our community We are passionate about contributing to the communities in which we operate and engaging our people to join together to make a difference where it counts.

We aim to support our people in their own communities around the world through local charitable donations, fundraising, volunteering activities and sports and social events. Atkins’ network of house managers continues to help coordinate and promote these activities through our offices. A few examples of activities that took place around the world during 2009/10 follow. Fuller information is available on our website (www.atkinsglobal.com/cr).

We continue to be actively engaged in a range of educational initiatives from primary schools through to universities. For example we support a number of undergraduate prizes at universities, often with the emphasis on low-carbon solutions, and contribute to undergraduate and postgraduate teaching programmes.

Many Atkins locations around the world, including Hong Kong, Dubai, Sharjah and London, supported the global ‘Earth Hour’ campaign this year by ensuring that all lights were switched off for the event.

Staff in Bangalore supported World Environment Day by planting trees, cleaning up the area and donating bins to the vicinity around our office.

An employee from our geospatial team has used his expertise to help locals in Sri Lanka clear danger zones of mines and to co-ordinate relief effort following the Haiti earthquake.

Clients and staff from our Leeds office took part in the three peaks challenge, raising £140,000 for charity over the last five years. This year proceeds went to the Wakefield Hospice.

Employees and their families supported the Emirates Environment Group Clean Up UAE campaign in the Dubai Investment Park area. They also supported the can collection drive helping to collect more than 13 tonnes of aluminium cans for recycling.


Governance

Governance52 Board of Directors54 Directors’ Report58 Corporate Governance Report65 Remuneration Report72 Independent Auditor’s Report

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52 Governance

Allan Cook CBEChairmanAllan Cook was appointed a non-executive director in September 2009, taking up the post of chairman on 1 February 2010. He is a chartered engineer with more than 30 years’ international experience in the automotive, aerospace and defence industries. He was chief executive of Cobham PLC until the end of December 2009. Prior to this he held senior roles at GEC-Marconi, BAE Systems and Hughes Aircraft. He is a non-executive director of Marshall of Cambridge (Holdings) Limited and a member of the operating executive board of J.F. Lehman & Company. He is also chairman of the Sector Skills Council for Science, Engineering and Manufacturing Technologies (SEMTA), past president of the Aerospace and Defence Industries Association of Europe (ASD), past president of the Society of British Aerospace and Defence Companies (SBAC), director of the Industry Forum, director of the Apprentice Ambassador Network and a committee member of the UK Ministerial Advisory Group for Manufacturing. He was awarded a CBE in the Queen’s New Year’s Honours list in 2008.

Keith ClarkeChief executiveKeith Clarke was appointed a director in October 2003. He is a chartered architect. He joined the Group from Skanska AB where he was executive vice president responsible for the company’s activities in the UK, Poland, Czech Republic, India and China. He has over 30 years’ experience in construction and engineering, having previously worked for the City of New York, Olympia & York, Trafalgar House and Kvaerner. He is an advisory board member of the Built Environment Innovation Centre at Imperial College, London, Patron of the Environmental Industries Commission and an honorary fellow of the Institution of Structural Engineers. He is currently deputy chairman of the UK Construction Industry Council (CIC), having served as chairman from 2008 to 2010 and previously chairing its Health and Safety Committee. He is a member of the Nomination Committee.

Heath DrewettGroup finance directorHeath Drewett was appointed a director with effect from 15 June 2009, and took over as Group finance director on 19 June 2009. A graduate in mathematics from Peterhouse, Cambridge, he started his career at PricewaterhouseCoopers where he qualified as a chartered accountant. Prior to joining the Group he held a variety of senior finance and corporate development roles at British Airways plc and The Morgan Crucible Company plc.

Alun GriffithsGroup HR directorAlun Griffiths was appointed a director in March 2007. He has a background in management consultancy and has led a wide range of projects in the areas of restructuring, organisational development and privatisation in the UK and internationally. He is an economics graduate and a fellow of the Chartered Institute of Personnel and Development. He was appointed Group HR director in February 2003. Alun chairs the Industry Board of the UK Resource Centre for Women in Science, Engineering and Technology (UKRC), an organisation charged with progressing the UK government’s strategy for increasing the participation of women in science and engineering.

Admiral the Lord BoyceNon-executive directorLord Boyce was appointed a non-executive director in May 2004. He had a distinguished career in the Royal Navy and the Ministry of Defence (MoD) that culminated in his becoming First Sea Lord, professional head of the Royal Navy, in 1998 and then Chief of Defence Staff, professional head of the Armed Forces, from 2001 to 2003. He was elevated to the peerage in 2003 and was appointed Lord Warden and Admiral of the Cinque Ports and Constable of Dover Castle in 2004. He is a non-executive director of VT Group plc. He is senior independent director and a member of the Remuneration and Nomination Committees.

Board of Directors


Governance 53

Fiona ClutterbuckNon-executive directorFiona Clutterbuck was appointed a non-executive director in March 2007. She has substantial experience in all areas of corporate finance, including a particular focus on the financial institutions’ sector, gained during 15 years at Hill Samuel and HSBC and latterly seven years at ABN AMRO. She has advised on a wide range of transactions in many countries, including mergers and takeovers, public company acquisitions and fundraisings, and public and private company sales and flotations. She has an LLB (Hons) from the University of London and qualified as a barrister in 1980. She is a director within the corporate office at Phoenix Group Holdings. She is a member of the Audit, Nomination and Remuneration Committees.

Joanne CurinNon-executive directorJoanne Curin was appointed a non-executive director in February 2009. She is a chartered accountant and has a broad range of international experience gained during her career as a senior finance executive for large-scale organisations in the property and construction, oil and gas, pulp and paper, shipping and logistics sectors. She has worked in the UK, New Zealand and Australia and more recently held finance director roles for both Lend Lease Corporation and P&O. She is currently a director of Intelligent Engineering Holdings, which has developed and is commercialising a composite material technology for use in heavy engineering structures. She is chairman of the Audit Committee and a member of the Nomination Committee.

Dr Raj RajagopalNon-executive directorRaj Rajagopal was appointed a non-executive director in June 2008. He held several positions at BOC Edwards before being appointed chief executive, a position he held until November 2006. He was an executive director of the BOC Group plc until November 2006 and is a non-executive director of Bodycote plc and Spirax-Sarco Engineering plc. He is also chairman of HHV Pumps Private Ltd and non-executive chairman of The University of Manchester Intellectual Property Limited. He is a fellow of the Royal Academy of Engineering, a fellow of the Institution of Engineering and Technology (IET), a fellow of the Institution of Mechanical Engineers, a fellow of the Chartered Institute of Management and a fellow of the Institute of Directors. He is also an Audit Commissioner and a member of the Advisory Board of the Centre for Business Research of Cambridge University. He was awarded an honorary doctor of science degree by Cranfield University in 2004 and the IET’s IEE Eric Mensforth International Gold Medal for outstanding contribution to manufacturing technology and management in 2003. He is a member of the Remuneration and Nomination Committees.

Sir Peter WilliamsNon-executive directorSir Peter Williams was appointed a non-executive director in May 2004. He graduated from Cambridge University with an MA and PhD in physics and initially pursued an academic career at Cambridge and subsequently at Imperial College, London. After a period with VG Instruments Limited he joined Oxford Instruments plc in 1982. He became its chief executive in 1985 and was chairman from 1991 until his retirement in 1999. He is chairman of the National Physical Laboratory and was elected as fifth chancellor of the University of Leicester on 21 October 2005. He is chairman of the Remuneration Committee and a member of the Audit and Nomination Committees.

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54 Governance


The directors present their annual management report on the affairs of the Company and the Group, together with the Financial Statements and the independent auditor’s report, for the year ended 31 March 2010. These will be laid before shareholders at the Annual General Meeting (AGM) to be held at 1630 hours on Thursday 9 September 2010. Details of the business to be considered at the AGM, together with an explanation of each of the resolutions, are set out in the separate Notice of Meeting.

Principal activities and business reviewWS Atkins plc is the ultimate holding company of a group of companies. Detailed information on the Group’s principal activities, its performance during the past year and its prospects for future development are reported in the Chairman’s Statement (pages 06 to 07), the Chief Executive’s Statement (pages 08 to 09), the Business Review (pages 16 to 35), the Human Resources Review (pages 36 to 41) and the Corporate Responsibility Review (pages 42 to 50). The statements and reviews are incorporated into this report by reference, together with the list of the principal subsidiary undertakings and the countries in which they operate (note 39 to the Financial Statements on page 121).

Acquisitions and disposals made by the Group during the year are described in notes 15 and 9 to the Financial Statements (pages 99 and 96).

Results and dividendsThe Group profit after tax for the year of £77.3m (2009: £84.2m) is shown in the Consolidated Income Statement (page 74).

The directors recommend a final dividend of 18.25p per ordinary share in respect of the year ended 31 March 2010, to be paid on 24 September 2010 to ordinary shareholders on the register on 20 August 2010. This is

subject to shareholder approval at the AGM. If approved, this will mean a total dividend of 27.5p per ordinary share will have been paid for the year to 31 March 2010 (2009: 26.0p) when added to the interim dividend of 9.25p per ordinary share paid on 29 January 2010. Further details regarding dividend payments can be found in Investor Information (page 126).

DirectorsThe names and biographical details of those persons serving as directors of the Company as at the date of this report are set out in this Annual Report (pages 52 and 53). Robert MacLeod, former Group finance director, and James Morley, former senior independent director, resigned from the Board on 19 June and 30 June 2009 respectively. Allan Cook and Heath Drewett were appointed to the Board during the year to 31 March 2010.

Under the Company’s articles of association all directors must retire at the first AGM following their appointment by the Board and may offer themselves for election by shareholders. They must subsequently retire from the Board at least every third year and, being eligible, may offer themselves for re-election. Additionally, one-third of directors must retire at each AGM and they may offer themselves for re-election.

Heath Drewett, following his appointment by the Board as a director on 15 June 2009, was elected by shareholders at the 2009 AGM. Allan Cook, who was appointed as a director on 10 September 2009, will retire at the next AGM in September 2010 and, being eligible, offer himself for election. Fiona Clutterbuck, Alun Griffiths and Sir Peter Williams will retire by rotation at the AGM and, being eligible, will offer themselves for re-election. Each will be subject to retirement by rotation at future AGMs in accordance with the Company’s articles of association.

The Board considers that the performance of the directors proposed for election and re-election continues to be effective and that they demonstrate a strong commitment to their role.

Directors and officers of the Company and its subsidiaries benefit from directors’ and officers’ liability insurance cover in respect of legal actions brought against them. In addition, directors of the Company are indemnified in accordance with article 143 of the Company’s articles of association to the maximum extent permitted by law. Prior to the adoption of new articles of association by shareholders on 3 September 2008, all directors in appointment on that date had separate deeds of indemnity. These indemnities, which still remain in force, are available for inspection by shareholders at the Company’s registered office during normal business hours and will be available for inspection at the AGM.

Neither the insurance nor the indemnities provide cover where the relevant director or officer has acted fraudulently or dishonestly.

The Board of directors may exercise all the powers of the Company, subject to the provisions of relevant legislation, the Company’s memorandum and articles of association and any directions given by a special resolution of the shareholders. Specific powers are detailed in the Company’s articles of association, including the power to issue and buy back shares, along with the rules for the appointment and removal of directors.

Directors’ interests in the Company and the Group are described in the Remuneration Report in Table 5 (page 70).

Directors’ Report

See pages 52 and 53 for Directors’ biographies

Governance 55


Govern

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Articles of associationCompany law has undergone substantial change since January 2007 when the phased implementation of the Companies Act 2006 (the Act) commenced. The articles of association of the Company were revised in 2008. At this time it was envisaged that further changes to the articles of association would be proposed at the 2009 AGM as a result of the continuing phased implementation of the Act and the implementation of the EU Shareholders’ Rights Directive (the Directive). However, some uncertainty surrounded the implementation of the Directive at the time of the 2009 AGM and it was therefore decided that the prudent approach was to delay further changes until 2010. A resolution will therefore be proposed at the Company’s forthcoming AGM to adopt new articles of association. Further details are contained in the Notice of Meeting.

Political donations and expenditureIt is the Group’s policy not to make political donations and not to incur political expenditure, either in the UK or overseas. Accordingly, the Group made no political donations and incurred no such expenditure during the year and has no intention of making any such donations or incurring such expenditure in the future. However, the provisions enacted in the Act relating to donations and expenditure covered by this disclosure are wide. To prevent an inadvertent breach of the Act the Board has historically sought authority for the Company and its subsidiaries to make such donations and incur such expenditure up to an aggregate limit for the Company and its subsidiaries of £90,000, subject to the provisions of the Act. The Board considers it prudent once again to seek such authority at the Company’s forthcoming AGM. The authority will not be used to make political donations within the normal meaning of that expression. Further details are contained in the Notice of Meeting.

Charitable donationsDuring the year, the Group made charitable donations of £93,054 (2009: £187,757). The beneficiaries of these donations were local charities serving the communities in which the Group operates or charities working in areas relevant to the Group’s activities. The Group intends to continue its focus on local charities in the current financial year.

Corporate governance and remunerationThe Company prepares reports on corporate governance (pages 58 to 64) and on directors’ remuneration (pages 65 to 71), which are incorporated into this report by reference.

Corporate responsibility A summary of the Group’s corporate responsibility activities is provided for shareholders in the Corporate Responsibility Review (pages 42 to 50). In addition, the Group provides further information on corporate responsibility, which includes detailed information in respect of safety leadership and performance, carbon reduction, respect for the environment and working with our community, on the Group’s website www.atkinsglobal.com/cr. EmployeesThe Group is committed to the fair and equitable treatment of all its employees, irrespective of sex, race, age, religion or belief, disability, sexual orientation, gender reassignment, marriage and civil partnership and pregnancy and maternity. To this end, policies have been put in place to ensure this commitment is implemented at recruitment and then continues throughout an individual’s employment with the Group. The Group encourages recruitment, training, career development and promotion on the basis of aptitude and ability, without regard to disability. It is also committed to retaining and retraining as necessary employees who become disabled during the course of their employment.

Employees are routinely informed of financial results and significant business issues via the use of email, voice conference, the Company’s intranet and in-house publications.

An annual survey is carried out to obtain feedback from employees. This survey is confidential and is used alongside consultation with employees and union representatives where appropriate.

Employee involvement in the Group’s performance continues to be encouraged through share ownership. In the UK, employees are given the opportunity to become shareholders through the Company’s Share Incentive Plan. Approximately 10% of UK employees participate in the Atkins Share Incentive Plan.

Further details on staff issues can be found in the Human Resources Review (pages 36 to 41).

SuppliersThe Group’s policy is to agree terms and conditions for its business transactions with suppliers and to endeavour to abide by these terms and conditions, subject to the supplier meeting its obligations.

No one supplier arrangement is considered to be essential to the business of the Group.

The Company, as a holding company, did not have any amounts owing to trade creditors as at 31 March 2010.

Share capital and share purchasesAs at the date of this report, the Company’s share capital consists of 104,451,799 issued and fully paid ordinary shares each with a nominal value of 0.5p, listed on the London Stock Exchange. Of these, 4,341,000 ordinary shares are held in treasury (the treasury shares). Shares may be held in certificated or uncertificated form. Further details of the Company’s authorised and issued share capital, including changes during the year, can be found in note 31 to the Financial Statements (page 114).

Notice of Meeting visitwww.atkinsglobal.com/ investors_agm

56 Governance


At the AGM held in 2009, the Company was granted authority by shareholders to purchase up to 10,011,000 ordinary shares, representing approximately 10% of the Company’s ordinary share capital as at 16 June 2009. No ordinary shares were purchased pursuant to this authority during the year ended 31 March 2010 or to the date of this Annual Report. This authority will expire at the forthcoming AGM and, in accordance with current best practice, the Company will seek to renew it.

4,341,000 ordinary shares of 0.5p, representing approximately 4.2% of the Company’s issued share capital, were held in treasury throughout the year following a share buy-back programme.

The rights and obligations attaching to the Company’s ordinary shares are contained in the Company’s articles of association, a copy of which is available on the Group’s website www.atkinsglobal.com or can be obtained on request from the company secretary. The articles of association can only be changed by a special resolution passed in a general meeting of shareholders.

Each ordinary share (other than treasury shares, which have no voting rights) carries the right to one vote on a poll at a general meeting of the Company. There are no restrictions on transfer or limitations on the holding of the Company’s ordinary shares and no requirements for prior approval of any transfers. Under the Company’s articles of association, the directors have the power to suspend voting rights and the right to receive dividends in respect of shares in circumstances where the holder of those shares fails to comply with a notice issued under section 793 of the Act.

Shares acquired through Atkins’ employee share schemes rank equally with all other ordinary shares in issue and have no special rights. The trustees of the Company’s Employee Benefit Trusts (EBTs) have waived their rights to dividends on shares held by the EBTs, with one EBT fully waiving this right and another waiving the right to dividends in excess of 0.01p per share. In addition none of the EBTs exercises its right to vote in respect of such shares. Shares held in trust on behalf of participants in the Atkins Share Incentive Plan are voted

by the trustee, Capita IRG Trustees Limited, as directed by the participants. Details of share-based payments, including information regarding the shares held by the EBTs can be found in note 32 to the Financial Statements (page 117).

The Company is not aware of any agreements between shareholders that might result in the restriction of transfer or voting rights in relation to the shares held by such shareholders.

Change of controlAll of the Company’s employee share schemes contain provisions relating to a change of control of the Company following takeover. Under these provisions, a change of control of the Company would normally be a vesting event, facilitating the exercise of options or transfer of allocations, subject to any relevant performance conditions being satisfied. The Company is not a party to any other significant agreements that take effect, alter or terminate upon a change of control following a takeover bid other than its bank facility agreement, which provides that on a change of control the Company is unable to draw down any further amounts under the facility. Further, it is not party to any agreement with the directors or employees providing for compensation for loss of office or employment (whether through resignation, purported redundancy or otherwise) that occurs as a result of a takeover bid.

Substantial shareholdersAs at the date of this report, the Company had been notified of the following holdings of 3% or more of the total voting rights attaching to its issued share capital:

Statement of directors’ responsibilitiesThe directors are responsible for preparing the Annual Report, the Remuneration Report and the Financial Statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. The directors have prepared the Group and Company Financial Statements in accordance with applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. Under company law the directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period.

In preparing the Financial Statements, the directors are required to:

select suitable accounting policies and then •apply them consistentlymake judgements and accounting •estimates that are reasonable and prudentstate whether applicable IFRSs as adopted •by the European Union have been followed, subject to any material departures disclosed and explained in the Financial Statementsprepare the Financial Statements on the •going concern basis, unless it is inappropriate to presume that the Group and the Company will continue in business.

Number of Percentage of Name of holder voting rights1 total voting rights1

Ameriprise Financial, Inc. 5,129,917 5.12%Aviva plc 3,015,076 3.01%BlackRock Inc. 9,939,227 9.52%Legal & General Group plc 3,910,332 3.90%Lloyds TSB Group plc 3,154,015 3.04%Newton Investment Management Limited 6,025,203 6.02%Norges Bank 3,024,392 3.02%Schroders plc 10,143,360 9.99%Veritas Asset Management (UK) Ltd 5,028,960 5.02%

1. Number and percentage of voting rights per last notification received by the Company.

Directors’ Report

continued

Governance 57


Govern

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The directors, whose names and functions are listed in this Annual Report (pages 52 and 53), confirm that, to the best of their knowledge:

they have complied with the above •requirements in preparing the Financial Statementsthe Directors’ Report includes a fair review •of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it facesthe Financial Statements, prepared in •accordance with IFRSs as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group and the Company.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and that enable them to ensure that the Financial Statements and the Remuneration Report comply with the Act and, as regards the Group Financial Statements, Article 4 of the International Accounting Standard Regulation. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Disclosure of audit informationThe directors confirm that, as at the date this report was approved, so far as each director is aware there is no relevant audit information of which the Company’s auditor is unaware and that he or she has taken all the steps he or she ought to have taken as a director in order to make himself or herself aware of any relevant audit information and to establish that the Company’s auditor is aware of that information.

Going concernThe directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future and therefore continue to adopt the going concern basis in preparing the Financial Statements.

AuditorsThe Company’s independent auditor, PricewaterhouseCoopers LLP, has expressed its willingness to continue in office and resolutions for its re-appointment and to authorise the directors to determine its remuneration will be proposed at the forthcoming AGM.

Approved by the Board and signed on its behalf by

Richard WebsterCompany secretary16 June 2010

Cautionary statementUnder the Companies Act 2006, a company’s directors’ report is required, among other matters, to contain a fair review by the directors of the Group’s business through a balanced and comprehensive analysis of the development and performance of the business of the Group and the position of the Group at the year-end, consistent with the size and complexity of the business.

The directors’ report set out above, including the Chairman’s Statement, the Chief Executive’s Statement, the Business Review, the Human Resources Review, the Corporate Responsibility Review, the Corporate Governance Report and the Remuneration Report incorporated into it by reference (together, the Directors’ Report), has been prepared only for the shareholders of the Company as a whole and its sole purpose and use is to assist shareholders to exercise their governance rights. In particular, the Directors’ Report has not been audited or otherwise independently verified. The Company and its directors and employees are not responsible for any other purpose or use or to any other person in relation to the Directors’ Report.

The Directors’ Report contains indications of likely future developments and other forward-looking statements that are subject to risk factors associated with, among other things, the economic and business circumstances occurring from time to time in the countries, sectors and business segments in which the Group operates. These factors include, but are not limited to, those discussed under Principal Risks and Uncertainties (pages 34 to 35). These and other factors could adversely affect the Group’s results, strategy and prospects. Forward-looking statements involve risks, uncertainties and assumptions. They relate to events and/or depend on circumstances in the future which could cause actual results and outcomes to differ materially from those currently anticipated. No obligation is assumed to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Articles of associationwww.atkinsglobal.com/ investors_constitution

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The Board is committed to maintaining high standards of corporate governance. The directors seek to ensure that the Group’s governance framework complies with accepted good practice and in particular with the principles of the Combined Code on Corporate Governance (the Code), adopted by the Financial Reporting Council (FRC) in June 2008. It provides an explanation of how the Code has been applied and the extent of the Company’s compliance. A copy of the Code can be found on the FRC’s website www.frc.org.uk.

A. DirectorsA.1 The BoardThe Board is responsible for the overall direction and management of the Company and for the establishment and maintenance of a framework of delegated authorities and controls which ensure the efficient and effective management of the Group’s operations.

Within this framework, operational management is delegated to the chief executive with the Board maintaining appropriate oversight of operational activities via regular review and reporting.

The Board retains control of a number of defined matters which include the consideration and approval of strategy, the approval of financial statements and shareholder circulars, Group policies, major capital investments, risk management strategy and significant acquisitions and disposals. The Board has held regular meetings throughout the year with discussions covering:

health, safety and environmental •performancethe Group’s strategic plan and the strategic •issues facing its businessespotential acquisitions and disposals•approval of the Group’s budget and •ongoing review of financial performancethe Group’s financial results and dividends•

people management including employee •engagement, recruitment, retention, succession planning and the Group’s pension plan arrangementsthe corporate governance framework •and internal controlsrisk monitoring and management•major projects and tenders•shareholder matters and feedback.•

Directors also meet as members of committees. The attendance of each director at Board meetings, and those committees of which they were a member during the year, is set out in Table 1. The business and academic background of each director in office at the year end is contained in his or her biography (pages 52 and 53). The chairman and non-executive directors also meet formally without the executive directors present. Regular dialogue takes place between directors between scheduled meetings.

The Board has approved terms of reference for each committee which are reviewed annually. Copies of the terms of reference for the Audit, Remuneration and Nomination Committees are available on the Group’s website www.atkinsglobal.com or on request from the company secretary. Following formal consideration the Board may also delegate authority to a standing committee, consisting of any two directors, to provide the final sign-off for an agreed course of action within pre-defined parameters.

A.2 Chairman and chief executiveThe roles of the chairman and chief executive are separate, with their responsibilities clearly defined. The chairman’s main responsibility is the leadership and management of the Board and its governance.

Corporate Governance Report

Table 1: Board and committee attendance Audit Remuneration Nomination Director Board Committee Committee CommitteeChairman Ed Wallis1 8/8 – 4/4 2/42

Allan Cook3 4/4 – – 1/1 Executive directors Keith Clarke 10/10 – – 5/5Heath Drewett4 8/8 – – –Alun Griffiths 10/10 – – –Robert MacLeod5 3/3 – – – Independent non-executive directors Admiral the Lord Boyce 10/10 – 5/5 5/5Fiona Clutterbuck 10/10 4/4 4/4 5/5Joanne Curin 10/10 4/4 – 5/5James Morley6 3/3 1/1 2/2 3/3Raj Rajagopal 10/10 – 5/5 5/5Sir Peter Williams 10/10 4/4 5/5 4/57

Attendance is expressed as number of meetings attended/number eligible to attend.

1. Ed Wallis resigned as a director and chairman on 31 January 2010.2. Ed Wallis absented himself from two meetings, mindful of the Code requirement that he should not

chair any discussion at which arrangements for the recruitment of his successor took place.3. Allan Cook was appointed as a non-executive director and chairman-elect on 10 September 2009.

He succeeded Ed Wallis as chairman on 1 February 2010.4. Heath Drewett was appointed as a director on 15 June 2009.5. Robert MacLeod resigned as a director on 19 June 2009.6. James Morley resigned as a director on 30 June 2009.7. One meeting was called at short notice and coincided with a prior engagement.

Terms of referencewww.atkinsglobal.com/ investors_tor

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Ed Wallis, chairman until 31 January 2010, usually spent two days per week on the business of the Group. His successor, Allan Cook, currently spends at least three days per week with Atkins. He has made this additional time commitment to obtain a thorough understanding of the Group and its operations, to meet staff and to engage with shareholders.

On appointment, Allan Cook met the independence criteria set out in the Code. He also disclosed his other significant commitments to the Board prior to his appointment and his current commitments are disclosed in his biography (page 52). The Board considers that these commitments do not hinder his ability to discharge his responsibilities to the Company effectively. Indeed, his involvement with organisations that promote the education of future engineers complements the Group’s efforts to promote engineering and technical professions.

The chief executive is responsible for the operational management and leadership of the Group. This includes formulating and recommending the Group’s strategy for Board approval in addition to executing the approved strategy. The chief executive coordinates the operational management of the Group via the Group Executive, the membership of which includes the managing directors of the Group’s principal businesses, the Group finance director, the Group HR director and the Group communications director. Those members of the Group Executive who are not directors of the Company meet with the Board at least biannually and proactively engage with the non-executive directors.

A.3 Board balance and independenceThe Board considers the independence of the non-executive directors annually against the criteria set out in the Code with each being determined as independent of management having no business or other relationship that could interfere materially with the exercise of their judgement.

Lord Boyce succeeded James Morley as senior independent director on 30 June 2009. His responsibilities include leading the non-executive directors’ annual consideration of the chairman’s performance. Lord Boyce is also available to shareholders in the event they feel it inappropriate to communicate via the chairman, the chief executive or the Group finance director.

Directors’ conflicts of interestDirectors are required to notify the company secretary of any potential conflicts of interest when they are appointed to the Board and, following appointment, as new potential conflicts arise. These notifications are then considered and authorised by the Board as appropriate. In addition, the Company has put in place an annual process to review conflict authorisations with the last review undertaken in October 2009.

A.4 Appointments to the BoardAllan Cook, Keith Clarke, Lord Boyce, Fiona Clutterbuck, Joanne Curin, Raj Rajagopal and Sir Peter Williams are members of the Nomination Committee. Ed Wallis was committee chairman until his retirement from the Board on 31 January 2010 with Allan Cook succeeding him as chairman. James Morley was a member of the committee until his retirement from the Board on 30 June 2009. The Committee’s responsibilities include:

reviewing the structure, size and •composition of the Boardidentifying and nominating candidates •for appointment to the Boardensuring planned and orderly succession•making recommendations to the Board •regarding the continuing service of directors and, if appropriate, their re-election to the Board, subject to shareholder approval.

The non-executive directors’ terms of appointment are available for inspection at the Company’s registered office during normal business hours and also at the Company’s AGM.

During the year the Committee recommended the appointment of Allan Cook as a non-executive director and chairman-elect with effect from 10 September 2009. Ed Wallis did not attend meetings regarding the appointment of his successor and these meetings were therefore chaired by James Morley initially, and subsequently Lord Boyce, as senior independent director. The Committee used an external search consultancy to assist in making the recommendation for Allan Cook’s appointment. As part of the search process, the Committee prepared a job specification including a clear indication of the time commitment expected. The Board believes that Allan Cook will be a considerable asset to the Company, bringing his experience to bear as it continues to grow the business.

A.5 Information and professional developmentThe company secretary is responsible for advising the Board on all governance matters and, under the chairman’s direction, is also responsible for ensuring that relevant information flows within and between the Board, its committees, the non-executive directors and senior management function effectively.

On joining the Board, directors take part in a formal induction process. This includes the provision of past Board materials to provide background information on the Group, information on Board processes and governance framework, site visits and meetings with employees. The induction is tailored to each new director’s specific needs with Allan Cook in the process of completing and Heath Drewett having undertaken a comprehensive induction programme.

See pages 52 to 53 for Directors’ biographies

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The company secretary ensures that the chairman, executive directors and non-executive directors are provided with appropriate training opportunities to enable them to discharge their responsibilities effectively. During the year this has included external training courses paid for by the Company. Key employees are also invited to attend Board lunches and dinners during the year and this, together with presentations and site visits, helps to ensure the non-executive directors remain informed of business developments.

All directors have access to the advice and services of the company secretary and are entitled to receive independent professional advice, at the Company’s expense, as required.

A.6 Performance evaluationThe Board is committed to ensuring its effectiveness. On his appointment as chairman, Allan Cook conducted an immediate appraisal of the Board, its Committees and individual directors collectively and via private one-to-one meetings with each director. He also obtained feedback on the Board from members of the Group Executive and the company secretary. A more comprehensive performance evaluation will take place later in 2010 and it is anticipated that an evaluation facilitated by an external third party will take place in 2011.

The performance of the previous chairman, Ed Wallis, was reviewed during the year by the non-executive directors, led by the senior independent director. The tenure of the new chairman, Allan Cook, has not been of sufficient length for a meaningful review of his performance to be carried out and this will therefore be considered later in 2010.

A.7 Re-electionIn accordance with the Company’s articles of association, one-third of the Board retires by rotation each year. In addition, any director appointed since the last AGM will stand for election at the next AGM and must subsequently retire from the Board at least every third year at which time, being eligible, he or she may offer himself or herself for re-election. This ensures that each Board member is re-elected at regular intervals.

B. RemunerationDetails of the directors’ remuneration and the work of the Remuneration Committee, as required by the Code, the Companies Act 2006 (the Act) and Schedules 5 and 8 of the Large and Medium-Sized Companies and Groups (Accounts and Reports) Regulations 2008, can be found in the Remuneration Report (pages 65 to 71).

C. Accountability and auditC.1 Financial reportingAll shareholder communications are designed to present a balanced and understandable view of the Group’s position and prospects. Statements regarding directors’ responsibilities and the status of the business as a going concern are given in the Directors’ Report (pages 56 and 57). The Company seeks to comply with Accounting Standards Board guidance on narrative reporting.

A summary of our share capital structure is set out in the Directors’ Report (pages 55 and 56).

Corporate Governance Reportcontinued

See pages 54 to 57 for our Directors’ Report

See page 65 to 71 for our Remuneration Report

Figure 1: Governance framework

Values and ethics

Board•Articlesofassociation •Mattersreserved•Termsofreference•Effectivenessreview •Grouppolicies

Business performance controls•Approvedstrategy•Businessstrategyreviews•Quarterlybusinessreviews•Targets•Monthlyreporting •Businessmanagementboards

Project controls •Commercialriskandauditframework•Businessmanagementsystem •Groupauthoritymatrix •Servicedeliveryprocessandprocedures•Projectmanagersanddirectors•Commercialproceduresandguidancenotes•Operationalriskreviewsandlogs•Projectsummaryreports •Projectaudits

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The Atkins Group

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C.2 Internal controlThe Board is responsible for reviewing and approving the Group’s governance framework and ensuring its adequacy and effectiveness, as set out in the Turnbull guidance. Internal controls, which include financial, operational and compliance and risk management systems, are central to this framework and are considered in three categories:

Board•business performance controls•project controls.•

The Group’s values and ethics permeate each category of the governance framework as do controls with regard to quality, safety and environment(QSE),peopleandauditandrisk.

The governance framework is illustrated in Figure 1.

The governance framework reflects the devolved and decentralised structure of the Group, which is considered a key part of the Group’s ability to deliver multi-local services to its clients. Under this structure authority and control are delegated from the chief executive to the managing directors of the principal businesses (each of whom are members of the Group Executive) and then downward to business and project managers as appropriate. Within this framework:

authority is delegated within clearly •prescribed limitsdecisions are escalated where either project •size or risk profile require a higher level of authorityactivity and performance are tracked •through monthly and quarterly reportseffectiveness is audited via internal audit •and self-assessment controls.

The governance framework is designed to manage, rather than eliminate, the risk of failure to achieve stated business objectives. It can only provide reasonable and not absolute assurance against material misstatement or loss.

Joint Ventures in which the Company does not have overall control are not covered by the Group’s governance framework. For these Joint Ventures, systems of internal control are applied as agreed between the Joint Venture parties.

Business performance controlsThe Group’s devolved and decentralised structure is considered key to its continued success. Within this, operational management is delegated to the managing directors and management teams of each business.

Strategic plans and annual budgets are developed via a structured process which ensures that each business responds appropriately to market opportunities within an overall strategy for the Group. These plans and budgets are reviewed formally by the chief executive, Group finance director and Group HR director before finally being approved by the Board.

The performance of each business against targets is reviewed quarterly by the chief executive, Group finance director and Group HR director. These reviews are wide-ranging, covering matters including quality, safety and environment, financial performance and forecasts, employee matters and commercial, strategy and operational matters.

In addition, the managing director and management team of each business review management accounts for the business on a monthly basis. The Group finance director and Group financial controller also review monthly financial performance. These monthly financial performance updates are consolidated and distributed to the Board, business managing directors and business finance directors.

Each business has a management board, which varies in size and composition to meet the specific needs of the business but always includes at its core the business managing director, business finance director, business commercial director and HR business partner. The business management board is responsible for the day-to-day operations of each business.

Project controlsThe primary objective of the Group’s project systems and controls is to deliver business objectives and customer requirements in an efficient and consistent manner. These systems and controls are mandated in order to minimise the risk of errors on projects, and to maximise the delivery of the required technical quality to customers and the required profitability to the Group.

Controls are in place to ensure that the right people approve bids, projects and purchases and that appropriate and focused reporting provides managers with the right information to make informed decisions. The system provides common processes to deliver maximum efficiency.

Whilst significant responsibility for commercial issues is delegated to the businesses, there are consistent controls in place to ensure the Group is able to assess and manage overall business risk. This is set out in the commercial risk and audit framework.

Within each business a framework of internal controls exists that forms a robust business management system. These systems include policies, processes, procedures, guidance, plans and other tools such as pro formas specific to the needs of the business. They are implemented to manage and control risk and to ensure activities are effectively controlled.

See pages 34 to 35 for our Principal risks and uncertainties

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The Group authority matrix summarises the authority of employees at each level of the organisation to commit the Group to expenditure and contractual liabilities in the course of their duties. It has been designed to allow the Group to operate flexibly and efficiently. Controls are in place to ensure the Group authority matrix and procedures around its operation and management are adhered to.

A service delivery process has been adopted to enable us to realise value from opportunities for customers, the Group and partners whilst always adhering to the Group’s business conduct policy. The process is applied from the receipt of a lead, through bidding, project delivery and project closure; the full life cycle of a project. It overlays requirements on line managers to ensure a consistent, controlled approach to projects.

Each bid and each project has a project manager and a project director appointed to it. These individuals are responsible for ensuring the project is carried out in accordance with the Group’s service delivery process. Controls exist to identify individuals who are suitable for these roles.

Commercial procedures and guidance notes have been developed to help bid and project managers understand specific commercial issues in the bidding process. Whilst the Group commercial policies and procedures are mandatory, guidance notes are advisory and provide the background to specific commercial and legal issues. The guidance notes are reviewed annually to ensure they are up to date and relevant.

An annual risk review of all parts of the Group is undertaken with the assistance of the Group’s insurance brokers. This review is based on interviews with key personnel and the results are shared with the Group’s Risk Committee and the Board. Risk logs are produced throughout the Group in accordance with the risk management policy, including project risk logs and business risk logs, which feed into the Group risk log. Project risk logs form an important part of the service delivery process whilst the Group risk log is reviewed by each of the Risk Committee, Audit Committee and Board.

Project summary reports are one-page summaries of the financial status of projects at a point in time. The project manager, project director and lead engineer are required to approve the report on a monthly basis.

Project audits are carried out by the internal audit function. The activities of this function are described in more detail below.

Quality, safety and environment (QSE)The Board sets Group policies on corporate responsibility,includingQSE.Thechiefexecutive is the Board member responsible for corporate responsibility and for the Group’s performance, supported by Group-wide frameworks. A common managementstructuregovernsQSE.TheGroupdirectorforQSE,whoreportsto the chief executive, is responsible for Group QSE.Eachbusinessalsohasdedicated QSErepresentatives.

Corporate responsibility-related Group policies include quality, health and safety, environment, sustainability, community, business conduct, data protection, dignity and equality at work, employee disclosure (whistle-blowing) and the appropriate use of information technology. These are published on the Group’s intranet and may be provided externally on request. They are reviewed regularly and updated to reflect changes to legislation, emerging good practice and business needs.

A summary of the Group’s corporate responsibility activities is provided for shareholders in the Corporate Responsibility Review (pages 42 to 50). In addition, the Group provides further information on corporate responsibility, which includes detailed information in respect of safety leadership and performance, carbon reduction, respect for the environment and working with our community on the Group’s website www.atkinsglobal.com/cr.

PeopleThe Group’s principal objective is to maintain a culture and an environment within which talented professionals can be recruited, retained, developed and deployed to work in support of its clients. Significant effort is made to treat staff consistently and fairly yet at the same time as individuals.

The Group endeavours to operate cohesively. However, people are employed in several countries where employment practices and legislation differ from the principal market in the UK. In these jurisdictions the Group operates in compliance with local requirements.

A range of business controls are maintained to ensure that the Group:

identifies and meets resource requirements•selects people with the requisite skills, •qualifications and credentialsmanages employee performance •and engagementdevelops the careers and capabilities •of individualsmakes skills and careers mobile across •the organisationassures the health and well-being of all staff•manages employment obligations, liabilities •and risks.

More information on the Group’s people is provided in the Human Resources Review (pages 36 to 41).

RiskThe Board has established a Risk Committee, chaired by the chief executive, to provide assistance with the day-to-day management of risk and to oversee the operation of the Group’s risk management framework. During the year, the members of the Risk Committee comprised the chief executive, the Group finance director, the company secretary, the Group legal director, the head of internal audit, the corporate services director and the Group risk manager. The Committee’s responsibilities during the year have included:

reviewing significant risks and ensuring •they are being actively managedinstilling risk awareness into Atkins’ •corporate culture and sharing knowledge and best practicereviewing and monitoring the changing •risk profile for the Groupreviewing the continued relevance of the •Group’s insurance programme arrangementsreviewing significant claims arising in the •period together with lessons learnedreporting to the Board and Audit •Committee regularly on its activities.



Corporate Responsibilitywww.atkinsglobal.com/cr

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Internal audit The Group aims to ensure that all its activities are adequately controlled to mitigate risk and support achievement of objectives, while avoiding the creation of excessive bureaucracy. The internal audit function supports this aim by providing the directors, through the Audit Committee, with an objective evaluation of the Group’s governance framework. The internal audit function also aims to raise levels of understanding and awareness of risk and control throughout the Group.

The head of internal audit reports to the Group finance director and, through the Audit Committee, to the Board. Where relevant, the internal audit function will additionally report its findings to members of the Group Executive and other operational managers.

The internal audit function uses an annual self-certification process which requires managers throughout the Group to personally confirm the testing of the internal controls and compliance with Group policies within their business or function and the steps taken to address actual or potential issues that are identified. Central reporting enables good practice to be shared throughout the Group.

The internal audit function has unlimited access to records, staff and data (subject to any formal client restrictions). The head of internal audit will report any concerns about restrictions placed on the authority or scope of the team’s work to the chief executive, Group finance director and Audit Committee.

The internal audit function is independent and free from interference in determining the scope of internal auditing, performing audit work and communicating results. It operates within the terms of its charter as laid out on the Group’s intranet and complies with the Standards and Code of Ethics of the Institute of Internal Auditors. Should the head of internal audit become aware of any non-compliance, the chief executive, Group finance director and Audit Committee would be informed.

Independent auditThe external audit is an important independent control.

The appointment of the independent auditor is approved by shareholders annually. The independent auditor’s audit of the Financial Statements is conducted in accordance with international standards on auditing issued by the Auditing Practices Board. The independent auditor, currently PricewaterhouseCoopers LLP, provides the following:

a report to the Audit Committee giving an •overview of the results, significant contracts and judgements and observations on the control environmentan opinion on the truth and fairness of the •Group and Company accountsan internal control report, following its •audit, highlighting to management any areas of weakness or concern.

Adequacy and effectiveness of internal controlsThe Board monitored and reviewed the adequacy and effectiveness of the Group’s governance framework, which includes internal controls and risk management, on a continual basis throughout the year ended 31 March 2010 and up to the date of approval of the Annual Report. Support was provided by the Group’s Risk Committee, the internal audit function and the Company’s independent auditor.

C.3 Audit Committee and auditorJoanne Curin, Fiona Clutterbuck and Sir Peter Williams are each members of the Audit Committee. James Morley was committee chairman until his retirement from the Board on 30 June 2009, when he was succeeded by Joanne Curin. Each member of the Committee is considered to be independent and to have recent and relevant financial experience. During the year the Committee’s activities have included:

monitoring the financial reporting process•an assessment of the effectiveness of the •Group’s system of internal control, risk management process and employee disclosure (whistle-blowing) and fraud response arrangements

a detailed review of the internal audit plan•regular examination of the reports arising •from the work undertaken by the internal audit functionapproval and review of an independent •assessment of the internal audit function and its remitregular review of the Group’s risk log•a review of the continued independence of •the independent auditor including a review of its audit and non-audit worka review of the independent auditor’s audit •strategy and implementation plan and its findings in relation to the Annual Report and half-year reportthe recommendation to the Board of the •independent auditor for re-appointmenta review of the Company’s draft Annual •Report, half-year results and associated announcements focusing on key judgemental areas and accounting policies.

The Committee meets the independent auditor and head of internal audit privately at each scheduled meeting. The independent auditor and head of internal audit also have unrestricted access to the Committee and its chairman.

PricewaterhouseCoopers LLP has been the Company’s independent auditor since it listed on the London Stock Exchange in 1996. The Audit Committee considers that the relationship with the independent auditor is working well and remains satisfied with its effectiveness. Accordingly, it has not considered it necessary to date to require the firm to tender for the audit work although it has considered its appointment on an annual basis. There are no contractual obligations restricting the Company’s choice of independent auditor. The Committee monitors the cost-effectiveness of audit and non-audit work performed by the independent auditor and also considers the potential impact, if any, of this work on independence. Approval is required prior to the independent auditor commencing any material non-audit work in accordance with a Group policy approved annually by the Committee. The policy identifies certain non-audit work, such as regulatory work, the auditing of share schemes, provision

64 Governance


of non-material systems or project services, that may be awarded with the approval of the executive directors within certain limited financial parameters and other work, such as the provision of material systems or project services, that requires specific approval of the Committee. Certain work, such as providing bookkeeping services, is prohibited. The Committee also regulates the appointment of former employees of the independent auditor to positions in the Group. The Committee regularly reviews all fees for non-audit work paid to the independent auditor. Details of these fees can be found in note 5 to the Financial Statements (page 93).

The independent auditor also operates procedures designed to safeguard its objectivity and independence. These include the periodic rotation of the audit partner, use of independent concurring partners, use of a technical review panel (where appropriate) and annual independence confirmations by all staff. The independent external auditor reports to the committee on matters including independence and non-audit work on an annual basis.

D. Relations with shareholdersD.1 Dialogue with institutional shareholdersThe Board regards effective communication with shareholders as key. Relations with shareholders are managed principally by the chief executive and Group finance director. Meetings are held regularly throughout the year with institutional investors, fund managers and analysts. The Group’s website contains information on current business activities including the annual and half-year results presentations.

The chairman, senior independent director and other non-executive directors make themselves available for meetings with major shareholders. This provides shareholders with the opportunity to take up with these individuals any issue they feel unable to raise with the chief executive or Group finance director.

Allan Cook wrote to the Company’s major institutional investors following his appointment as chairman-elect, setting out his and the Board’s commitment to shareholder engagement and offering to meet with them to gain a better understanding of their views. Representatives covering over 33% of the issued share capital of the Company accepted the offer and have now met with him to discuss their views. The feedback from these meetings has been discussed by the Chairman with the Board.

The non-executive directors are also kept informed of the views of shareholders with the executive directors providing updates on investor meetings. The Group’s broker provides briefings to the Board on shareholder opinions and compiles independent feedback from investor meetings.

Following the appointment of Allan Cook, the Board engaged a third party to conduct an independent appraisal of shareholder engagement by the Company. The results of this appraisal were presented to the Board in June 2010.

D.2 Constructive use of the AGMThe Company’s shareholders are invited to attend the AGM at which all directors are present. Shareholder participation is encouraged by enabling proxy votes to be lodged online via the Company’s share portal, www.myatkinsshares.com.

Statement of compliance with the Combined CodeThroughout the year ended 31 March 2010 the Company complied with the provisions of Section 1 of the Code.


Richard WebsterCompany secretary16 June 2010


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This report has been prepared in accordance with the Companies Act 2006 (the Act) and Schedules 5 and 8 of the Large and Medium-Sized Companies and Groups (Accounts and Reports) Regulations 2008 (the Regulations). A resolution to approve the report will be proposed at the Company’s AGM at which the Financial Statements will be presented for approval.

This report has been divided into separate sections for unaudited and audited information. The Regulations require the independent auditor to report to our shareholders on the audited information section of this report and to state whether, in its opinion, that part of the report has been properly prepared in accordance with the Act and the Regulations.

Unaudited informationRemuneration CommitteeThe Remuneration Committee at 31 March 2010 comprised Sir Peter Williams, Lord Boyce, Fiona Clutterbuck and Raj Rajagopal. Fiona Clutterbuck joined the Committee on 15 June 2009. All members are independent non-executive directors. James Morley and Ed Wallis were both members of the Committee until their retirements on 30 June 2009 and 31 January 2010 respectively. Ed Wallis, the former Company chairman, was considered independent on appointment. The Committee is chaired by Sir Peter Williams. Details of attendance at Committee meetings can be found in Table 1 of the Corporate Governance Report (page 58).

The Committee reviews the remuneration policy for the chairman and executive directors and, more generally, the remuneration policy of the Group. It determines the level of remuneration, incentives and other benefits, compensation payments and terms of employment of the chairman and each executive director. The Committee seeks to provide appropriate incentives to enhance performance and align the interests of the executive directors with those of shareholders. It also reviews the salaries and benefits of members of the Group Executive, the company secretary and other senior managers reporting directly to the chief executive. The Committee also has oversight of remuneration matters

across the Group. The terms of reference of the Committee are available on the Group’s website www.atkinsglobal.com or on request from the company secretary.

The Committee appointed, and continued to use, Hewitt New Bridge Street (HNBS) to provide advice on structuring executive remuneration packages and benchmarking. HNBS does not provide any other services to the Group. Legal advice with respect to remuneration matters is provided by Linklaters LLP. Linklaters also provides legal services to the Company. In determining remuneration, the Committee also consults the chief executive, Keith Clarke, the Group HR director, Alun Griffiths, and, where required, the company secretary, Richard Webster, about its proposals. No director or senior manager participates in discussions about their own remuneration.

Remuneration policyThe objectives of the Group’s remuneration policy are to attract, retain and incentivise management with the appropriate professional, managerial and technical expertise to realise our business objectives and to align their interests with those of our shareholders. The Group endeavours to link total remuneration to performance and thereby create a performance culture. More than half of the executive directors’ total remuneration is linked to performance through participation in the performance bonus plan and long term share incentives.

To ensure that we offer the best available incentives to enhance shareholder value, the Committee continued to assess the following constituent elements of the remuneration of the executive directors and review the same elements for members of the Group Executive and senior managers:

A. salary and other benefitsB. performance bonus paymentsC. long term share incentivesD. all-employee share planE. retirement benefits.

In determining remuneration, consideration is given to reward levels throughout the organisation as well as in the external employment market. The Committee aims to reward all employees fairly based on their

role, their performance and salary levels in the wider market. The remuneration policy described below will be kept under review, but the current intention is that the policy should continue to apply in future financial years.

A. Salary and other benefitsThe Committee reviews the salary of the executive directors, members of the Group Executive and senior managers annually to ensure they remain appropriate and competitive. In doing so the Committee also considers salary levels in all Group businesses. A wide range of data is utilised by the Committee, together with assistance from HNBS as appropriate.

Consistent with the approach taken for all Group employees, the annual salaries of the executive directors were not reviewed in April 2009. However, in light of the economic circumstances at that time, each of Keith Clarke, Alun Griffiths and former Group finance director Robert MacLeod requested that 10% of their basic salaries for the financial year ended 31 March 2010 be waived. This waiver did not affect the underlying reference salary used to calculate related benefits such as bonus, long term share incentives and pension entitlement. The waivers expired on 31 March 2010 and, accordingly, the salaries of Keith Clarke and Alun Griffiths reverted to the pre-waiver salaries of £425,000 and £200,000 respectively with effect from 1 April 2010.

Heath Drewett, who was appointed as a director on 15 June 2009, and succeeded Robert MacLeod as Group finance director on 19 June 2009, was appointed with an annual salary of £250,000. His salary had been adjusted downwards by 10% on his joining the Company to reflect the waivers which his fellow directors had put in place. Following the cessation of the salary waivers for Keith Clarke and Alun Griffiths, Heath Drewett’s salary was increased to £275,000 with effect from 1 April 2010. This increased salary is within the range for peers in comparable organisations.

Other benefits for executive directors include a car allowance or a car and payment of its operating expenses, life assurance and entitlement to a non-contributory private healthcare scheme.

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B. Performance bonus paymentsThe Company’s bonus and long term incentive plans seek to provide executive directors, members of the Group Executive and senior managers with the opportunity to increase overall remuneration levels to the upper quartile for comparable businesses but only following demanding performance targets being achieved.

Executive directors were eligible to receive bonuses of up to 90% of their salary for achieving Group financial targets in respect of the year ended 31 March 2010. The Committee also reviews individual performance, and Group performance in respect of health and safety and staff retention, when considering bonus payments. In addition, the Committee had the discretion to increase the bonus to pay out up to 100% of salary in exceptional circumstances. The Committee has resolved to pay a bonus of 90% of salary to Keith Clarke, Heath Drewett and Alun Griffiths having each exceeded challenging pre-set financial targets. Heath Drewett’s bonus will be pro rated to reflect his period of employment.

The Committee conducted a thorough review of remuneration during the year ended 31 March 2009 to determine what changes, if any, should be made to both the levels and structure of the total reward package of each executive director and concluded that any changes should be deferred in light of the challenging economic circumstances. The Committee considered the position again during the financial year ended 31 March 2010 and concluded that it would be appropriate to increase the maximum bonus to 100% of salary. Consistent with the existing policy, 90% of salary will be paid for meeting challenging financial objectives. Consideration is also given to the Group’s performance in respect of health and safety and staff retention. In addition, 10% of salary will be paid for the delivery of stated personal objectives for each director.

Executive directors are required to take one-third of any bonus in the form of an award over shares under the terms of the Atkins Deferred Share Plan (Deferred Share Plan). The Deferred Share Plan is designed to aid retention, with the awards to executive directors being subject to forfeiture on resignation within three years of grant. There are no further performance conditions once the award has been made. Dividends declared on Deferred Share Plan awards are rolled up and delivered to participants in cash on release of the award to align their interests further with those of shareholders.

Bonus awards are non-pensionable and non-contractual.

C. Long term share incentivesThe Atkins Long Term Incentive Plan (LTIP) seeks to motivate and retain the executive directors, members of the Group Executive and other senior managers. Under the LTIP, awards to executive directors and members of the Group Executive are made on the following basis:

50% of the award is subject to the •Company’s total shareholder return (TSR) performance relative to the constituents of the FTSE 250 Index (excluding investment trusts) on the date of award. Full vesting is achieved if the Company ranks in the upper quartile, 30% for a median ranking, and pro rata vesting for intermediate performance. No vesting occurs for a ranking below median50% of the award is subject to the Group’s •real growth in normalised earnings per share (EPS) over the performance period. An increase in EPS of more than 10% per annum above the UK Retail Price Index (RPI) over the three-year performance period enables the shares to vest in full; an increase of 4% per annum above the UK RPI will result in 30% of the shares vesting; no shares vest for an increase of less than 4% per annum above the UK RPI. Pro rata vesting operates for growth in EPS between 4% and 10% above the UK RPI.

Awards made to other participants may be subject solely to the EPS condition as set out above.

Dividends declared on shares subject to LTIP awards are rolled up and delivered to executives in cash on release of the underlying award.

The Committee believes that EPS growth provides a closer ‘line of sight’ between management performance and reward than can be achieved via TSR alone.

This year the Committee intends to make LTIP awards at around 100% of salary to the executive directors following the announcement of the Group’s preliminary results. As in previous years, the number of shares subject to the awards will be based on a share price on 1 April 2010. The upper limit for awards under the LTIP is 150% of salary. The Committee has considered the impact of the expiry of a letter of credit in respect of the Metronet enterprise and the release of a related provision giving rise to a one-off, non-cash pre-tax credit of £25.0m in the Group’s income statement for the year. It has concluded that the non-trading nature of this benefit is not a fair reflection of underlying earnings. Excluding this item, normalised basic EPS for the year ended 31 March 2010 was 79.4p. This lower EPS figure has been used to calculate the vesting of awards made under the LTIP in 2007 and will also be used as the base for the 2010 awards.

A full summary of the performance conditions attaching to existing share plan awards can be found in note 32 to the Financial Statements (page 115).

The LTIP allows for the use of market purchase, new issue and treasury shares to satisfy awards. To date all vested LTIP awards have been satisfied using shares purchased in the market. Awards under other share plans are satisfied using shares purchased in the market. The Committee reviews the method by which outstanding awards under the LTIP and other discretionary share plans are satisfied on a regular basis and it is currently intended to satisfy outstanding awards under the LTIP using market purchase or treasury shares.

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The executive directors are encouraged to hold shares in the Company (either directly or through share awards made in connection with annual bonuses) equivalent to the level of their annual salary, based on the value of such shares at the time of their acquisition (or award), or their current market value from time to time, whichever is the higher.

D. All-employee share planThe Company’s Share Incentive Plan, as approved by HM Revenue & Customs, continues to be offered to all eligible UK employees, including the executive directors.

E. Retirement benefitsPension and retirement benefits provided to the executive directors are comparable to those provided by other companies.

Performance graphThe Company’s performance, measured by TSR, is compared with the performance of the FTSE 250 Index (excluding investment trusts) over the past five years using industry standard methods to determine performance. This is considered the most appropriate index against which to measure performance as the Company has been a member of the FTSE 250 for the whole of the five-year period. This is illustrated in Figure 1 (page 69).

TSR is defined as the return shareholders would receive if they held a notional number of shares and received dividends on those shares over a period of time. Assuming dividends are reinvested into the Company’s shares, it measures the percentage growth in the Company’s share price together with the value of any dividends paid.

External appointmentsThe Board recognises the benefit Atkins can obtain if its executive directors serve as non-executive directors of other companies. Subject to review in each case, the Board’s general policy is that each executive director may accept one non-executive directorship with another FTSE 350 company from which any fees received may be retained. Robert MacLeod was a non-executive director of Aggreko plc during his directorship and retained the fees payable, receiving £48,000 in respect of its financial year ended 31 December 2009.

Directors’ contractsChairman and non-executive directorsThe chairman and non-executive directors have letters of appointment stating their annual fee and that their appointment is initially for a term of three years subject to satisfactory performance and their re-election at forthcoming AGMs. Their appointment may be terminated with six months’ written notice at any time. Table 1 (page 69) summarises the dates of appointment and most recent re-election dates for the chairman and each of the non-executive directors.

Copies of the letters of appointment will be available for inspection prior to and during the AGM and are also available for inspection at the Company’s registered office during normal business hours.

The remuneration of the chairman is determined by the Committee. The remuneration of the non-executive directors is determined biennially by the Board on the recommendation of the executive directors within the limits set out in the articles of association and on the basis of independent advice and the level of fees paid to non-executive directors of comparator companies. Mindful of salary constraints within the Group the Board, on the recommendation of the chief executive, resolved to postpone the 2010 biennial review until October. The annual fees are specific to each director reflecting their individual commitments to the Board and various Board Committees. The current fee structure is shown in Table 2 (page 69).

The chairman and the non-executive directors are not eligible for pensions, share incentives, annual bonus or any similar payments other than out-of- pocket expenses in connection with the performance of their duties. The chairman and the non-executive directors do not participate in any meeting at which discussions in respect of matters relating to their own position take place.

Executive directorsThe service agreements of the executive directors are summarised in Table 3 (page 69).

In the event of unsatisfactory performance, the notice period for the executive directors is reduced to three months. Their service agreements include a duty to mitigate loss where the agreement is terminated and any payment in lieu of notice may be reduced to take account of such mitigation. No service agreement provides for predetermined amounts of compensation in the event of early termination of service contracts.

The service agreements will terminate when the director reaches the retirement age as determined by the Board, and are otherwise terminable on giving 12 months’ notice. Copies of each director’s service agreement will be available for inspection prior to and during the AGM and are also available for inspection at the Company’s registered office during normal business hours.

Audited informationDirectors’ emolumentsThe remuneration of each director, excluding long term incentive awards and pensions, during the year ended 31 March 2010 is set out in Table 4 (page 70).

Retirement benefitsKeith Clarke has a contractual entitlement to receive an amount equivalent to 25% of his salary as a pension payment. He elected to receive this entitlement as an additional emolument and this is reported in Table 4 (page 70).

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Heath Drewett has a contractual entitlement to receive an annual amount equivalent to 25% of his basic salary towards his pension benefits. During the year the Company made payments of £49,760 (2009: £0) into his personal pension plan. Robert MacLeod had the same contractual entitlement. During the year the Company made payments of £17,692 (2009: £76,875) into his personal pension plan.

Alun Griffiths is 55 and was a member of a defined benefit arrangement until 30 September 2007 when the scheme was closed to future accrual. As at that date he had completed 21.5 years pensionable service. Since 1 October 2007 he has participated in a defined contribution arrangement on the same terms as other UK-based staff. The value of his accrued benefit under the final salary arrangement at the start of the financial year was £69,990 per annum with a transfer value of the total accrued benefit of £886,420. His accrued annual pension did not increase during the year. This sum will increase in line with increases in Alun’s salary. The increase in the transfer value of his accrued benefits was £107,833. As at 31 March 2010, the value of his accrued benefit was £69,990 per annum, with a transfer value of the total accrued benefit of £994,253. Under the defined contribution arrangement he receives an annual amount equivalent to 13% of his basic salary. This consists of a 10% ordinary employer contribution and a transitional employer contribution of 3% payable until 30 September 2010. The transitional contribution is payable to all members of the Atkins Pension Plan affected by the closure of their defined benefit accrual. During the year the Company made payments of £26,000 (2009: £26,000) under Alun’s defined contribution arrangement and a further £1,792 (2009: £1,792) in respect of National Insurance contributions the Company would have paid had he not chosen to contribute £14,000 to his defined contribution pension via salary exchange.

The executive directors receive life assurance cover equal to four times their salary. Alun Griffiths, consistent with other employees with a defined benefit arrangement under the Atkins Pension Plan, will additionally receive life assurance equal to three times his salary from 1 October 2010.

Directors’ interestsThe interests of the directors and their families in the ordinary shares of 0.5p each in the Company as at 31 March 2010 are shown in Table 5 (page 70).

Details of directors’ share options and long term incentives as at 31 March 2010 are given in Table 6 (page 71).

Directors’ share options and long term incentivesDirectors’ emoluments disclosed in Table 4 (page 70) do not include any amounts for the value of options to acquire ordinary shares in the Company granted to or held by the directors, which are set out in Table 6 (page 71).

For each share under option that had not expired at the end of the financial year, the mid-market price on 31 March 2010 was 620p and the highest and lowest mid-market prices during the financial year were 669p and 494.25p respectively.


Sir Peter WilliamsChairman of the Remuneration Committee16 June 2010


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Figure 1: Total shareholder return

Table 1: Dates of appointment and most recent re-election dates for the chairman and each of the non-executive directors

Date of appointment as a Date of last non-executive re-election Name of director director at AGMLord Boyce 05/05/04 09/09/09Fiona Clutterbuck1 13/03/07 05/09/07Allan Cook2 10/09/09 n/aJoanne Curin 10/02/09 09/09/09Raj Rajagopal 24/06/08 03/09/08Sir Peter Williams1 05/05/04 05/09/07

1. Fiona Clutterbuck and Sir Peter Williams will stand for re-election as directors at the AGM to be held on 9 September 2010.2. Allan Cook will stand for election as a director at the AGM to be held on 9 September 2010.

Table 2: Chairman and non-executive directors’ feesChairman fee1 £160,000Basic annual fee £37,000Committee chair annual fee £6,000Committee annual fee2 £3,000

1. In addition to this fee a taxable expense allowance up to a maximum of £10,000 per annum is also permitted, subject to the production of receipts, for travel in connection with visits to the Group’s London and Epsom offices.

2. No fee is paid in respect of membership of the Nomination Committee.

Table 3: Executive directors’ service agreements Notice Effective Unexpired period Contract date of term of (months) date contract contractKeith Clarke 12 12/09/03 01/10/03 Rolling contractHeath Drewett 12 17/04/09 15/06/09 Rolling contractAlun Griffiths1 12 18/04/07 13/03/07 Rolling contract

1. Alun Griffiths will stand for re-election as a director at the AGM to be held on 9 September 2010.

2005 2006 2007 2008 2009 2010

Atkins

FTSE 250

80

100

120

140

160

180

200

220

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Table 4: The remuneration of each director, excluding long-term incentive awards and pensions, during the year ended 31 March 2010 Other Other Non-cash Total Total Salary/fees Bonus benefits payments emoluments 2010 2009 £000 £0007 £0009 £000 £00012 £000 £000Executive directorsKeith Clarke 382.5 255.0 19.3 137.910 127.5 922.2 970Heath Drewett1 199.0 131.18 10.7 – 65.6 406.4 n/aAlun Griffiths 180.0 120.0 14.4 10.111 60.0 384.5 394Robert MacLeod2 63.9 – 3.2 – – 67.1 532Total executive directors 825.4 506.1 47.6 148.0 253.1 1,780.2 1,896Chairman and non-executive directors Lord Boyce 40.0 – 0.4 – – 40.4 40Fiona Clutterbuck 42.4 – – – – 42.4 3013

Allan Cook3 41.1 – 5.8 – – 46.9 n/aJoanne Curin 42.3 – 0.2 – – 42.5 514

James Morley4 11.5 – – – – 11.5 46Raj Rajagopal 40.0 – 2.1 – – 42.1 2914

Ed Wallis5 150.06 – 10.2 – – 160.2 212Sir Peter Williams 46.0 – 0.5 – – 46.5 46Total chairman and non-executive directors 413.3 – 19.2 – – 432.5 408

1. Heath Drewett was appointed as a director on 15 June 2009.2. Robert MacLeod resigned as a director on 19 June 2009.3. Allan Cook was appointed a non-executive director and chairman-elect on 10 September 2009. He succeeded Ed Wallis as chairman on 1 February 2010.4. James Morley resigned as a director on 30 June 2009.5. Ed Wallis resigned as a director and chairman on 31 January 2010.6. Ed Wallis requested that 10% of his fees for the financial year to 31 March 2010 be waived, reducing the annual fee payable for the year ending 31 March 2010 to £150,000.7. Amounts payable in cash.8. Bonus payment of 90% of salary as at 1 April 2010 pro rated to reflect Heath Drewett’s period of employment.9. Other benefits include such items as company cars or allowances, fuel and medical insurance for the executive directors and expenses chargeable to income tax for

the chairman and non-executive directors.10. Keith Clarke is entitled to a pension payment equivalent to 25% of his salary. He elected to receive this entitlement as a taxable payment. In addition, he received a

payment of £31,640 equal to the dividends declared on shares subject to awards made to him under the terms of the Company’s share plans following the vesting and exercise of the underlying awards.

11. Payment equal to the dividends declared on shares subject to awards made to Alun Griffiths under the terms of the Company’s share plans following the vesting and exercise of the underlying awards.

12. Keith Clarke, Heath Drewett and Alun Griffiths are required to take a minimum of one-third of their bonus payment in the form of a right to acquire shares under the Deferred Share Plan (the Plan). Awards of shares to these values will be made following the announcement of the preliminary results pursuant to the rules of the Plan to Keith Clarke, Heath Drewett and Alun Griffiths. These awards will be disclosed in the directors’ share options and long term incentives table in the 2011 Remuneration Report.

13. Fiona Clutterbuck elected to waive her fee in favour of a charity of her choice until 30 June 2008.14. Raj Rajagopal and Joanne Curin were appointed as non-executive directors on 24 June 2008 and 10 February 2009 respectively.

Table 5: Directors’ interests At 16/06/10 As at 31/03/10 At 31/03/09Chairman and non-executive directorsLord Boyce 2,500 2,500 846Fiona Clutterbuck 2,811 2,811 1,000Allan Cook 12,348 12,348 n/aJoanne Curin – – –James Morley1 n/a n/a 3,750Raj Rajagopal 15,000 15,000 5,000Ed Wallis2 n/a n/a 2,500Sir Peter Williams 2,500 2,500 2,500 35,159 35,159 15,596Executive directors Keith Clarke3 124,141 124,088 84,257Heath Drewett4 – – n/aAlun Griffiths3 37,139 37,086 22,374Robert MacLeod5 n/a n/a 27,846 161,280 161,174 134,477Total 196,439 196,333 150,073

1. James Morley resigned as a director on 30 June 2009. At the date of his resignation he was interested in 27,917 ordinary shares of 0.5p each in the Company.2. Ed Wallis resigned as a director and chairman on 31 January 2010. At the date of his resignation he was interested in 2,500 ordinary shares of 0.5p each in the Company.3. Changes in directors’ interests of Keith Clarke and Alun Griffiths between 31 March and 16 June 2010 relate to shares acquired via the Atkins Share Incentive Plan.4. Heath Drewett was appointed as a director on 15 June 2009.5. Robert MacLeod resigned as a director on 19 June 2009. At the date of his resignation he was interested in 27,917 ordinary shares of 0.5p each in the Company.


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Table 6: Directors’ interest in share options and long term incentives Mid- First Number market date of of shares Number of Market price exercise/ under shares under price on at date Gain on end of Date Plan Award option at option at exercise of grant exercise performance of lapse name1 date 01/04/09 Granted Exercised Lapsed 31/03/105 (pence) (pence) (£) condition of option

Keith Clarke LTIP2 24/06/05 25,000 – – 25,000 – 670.0 01/04/09 24/06/15 11/09/06 47,500 – 39,325 8,175 – 650.1088 837.0 255,655 11/09/09 11/09/16 03/08/07 44,0003 – – – 44,000 1035.0 03/08/10 03/08/17 27/06/08 38,600 – – – 38,600 1048.0 27/06/11 27/06/18 19/06/09 – 85,0004 – – 85,000 582.5 19/06/12 19/06/19 DBP 29/06/06 6,401 – 6,401 – – 629.25 826.0 40,278 29/06/09 29/06/16 27/06/08 13,482 – – – 13,482 1048.0 27/06/11 27/06/18 19/06/09 – 25,915 – – 25,915 582.5 19/06/12 19/06/19Total 174,983 110,915 45,726 33,175 206,997 295,933 Heath Drewett LTIP2 19/06/09 – 50,0004 – – 50,000 582.5 19/06/12 19/06/19Total – 50,000 – – 50,000 – Alun Griffiths LTIP2 25/06/04 3,000 – 3,000 – – 629.25 586.5 18,878 01/04/08 25/06/14 24/06/05 10,000 – – 10,000 – 670.0 01/04/09 24/06/15 11/09/06 14,000 – 11,590 2,410 – 644.75 837.0 74,727 11/09/09 11/09/16 03/08/07 18,0003 – – – 18,000 1035.0 03/08/10 03/08/17 27/06/08 18,100 – – – 18,100 1048.0 27/06/11 27/06/18 19/06/09 – 40,0004 – – 40,000 582.5 19/06/12 19/06/19 DBP 26/08/02 1,663 – 1,663 – – 629.25 289.0 10,464 26/08/05 26/08/12 24/06/05 3,037 – 3,037 – – 629.25 670.0 19,110 24/06/08 24/06/15 29/06/06 3,099 – 3,099 – – 629.25 826.0 19,500 29/06/09 29/06/16 29/06/07 2,777 – – – 2,777 1022.0 29/06/10 29/06/17 27/06/08 5,233 – – – 5,233 1048.0 27/06/11 27/06/18 19/06/09 – 10,989 – – 10,989 582.5 19/06/12 19/06/19Total 78,909 50,989 22,389 12,410 95,099 142,679 Robert MacLeod LTIP2 24/06/05 10,000 – – 10,0006 – 670.0 01/04/09 24/06/15 11/09/06 28,750 – – 28,7506 – 837.0 11/09/09 11/09/16 03/08/07 30,0003 – – 30,0006 – 1035.0 03/08/10 03/08/17 27/06/08 27,250 – – 27,2506 – 1048.0 27/06/11 27/06/18 DBP 29/06/06 4,388 – – 4,3886 – 826.0 29/06/09 29/06/16 27/06/08 9,514 – – 9,5146 – 1048.0 27/06/11 27/06/18Total 109,902 – – 109,902 – – Aggregate gains on share options 2010 438,613 Aggregate gains on share options 2009 288,623

1. Plan names: LTIP – Atkins Long Term Incentive Plan DBP – Atkins Deferred Bonus Plan 2. Subject to performance criteria described in note 32 to the Financial Statements.3. Following the exceptional write down in relation to Metronet, the Company’s EPS for the financial year ended 31 March 2007 was (56.8)p. The consequence of this was

that any LTIP awards made in 2007 would never be capable of vesting. Pursuant to the rules of the plan, the Remuneration Committee considered that it was appropriate to remove profit in respect of discontinued operations and the exceptional loss in respect of Metronet and that the EPS for the financial year ending immediately before the commencement of the performance period for the 2007 awards be deemed to be 57.3p.

4. In 2009 the Remuneration Committee considered the impact of the £7.0m tax benefit from the purchase of prior year consortium relief from the Metronet companies and concluded that the non-trading nature of this benefit was not a fair reflection of underlying earnings. Pursuant to the rules of the plan, the Remuneration Committee considered it was appropriate to remove the benefit of this item and that the EPS for the financial year ending immediately before the commencement of the performance period for the 2009 award was 76.4p.

5. The awards granted under the terms of the LTIP and the DBP are structured as options, for which the exercise price is nil.6. Robert MacLeod’s awards lapsed on the date of his resignation.

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Independent Auditor’s Report to the members of WS Atkins plc

We have audited the financial statements of WS Atkins plc for the year ended 31 March 2010 which comprise the Consolidated Income Statement, the Consolidated and Parent Company Statements of Comprehensive Income, the Consolidated and Parent Company Balance Sheets, the Consolidated and Parent Company Statements of Cash Flows, the Consolidated and Parent Company Statements of Changes in Equity and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

Respective responsibilities of directors and auditorAs explained more fully in the Directors’ Responsibilities Statement set out on page 56, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.

This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Scope of the audit of the financial statementsAn audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the group’s and the parent company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements.

Opinion on financial statementsIn our opinion:

the financial statements give a true •and fair view of the state of the group’s and of the parent company’s affairs as at 31 March 2010 and of the group’s profit and group’s and parent company’s cash flows for the year then ended;the group financial statements have been •properly prepared in accordance with IFRSs as adopted by the European Union; the parent company financial statements •have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; andthe financial statements have been •prepared in accordance with the requirements of the Companies Act 2006 and, as regards the group financial statements, Article 4 of the lAS Regulation.

Opinion on other matters prescribed by the Companies Act 2006In our opinion:

the part of the Directors’ Remuneration •Report to be audited has been properly prepared in accordance with the Companies Act 2006; and the information given in the Directors’ •Report for the financial year for which the financial statements are prepared is consistent with the financial statements; andthe information given in the Corporate •Governance Statement set out on pages 58 to 64 with respect to internal control and risk management systems and about share capital structures is consistent with the financial statements.

Matters on which we are required to report by exceptionWe have nothing to report in respect of the following:

Under the Companies Act 2006 we are required to report to you if, in our opinion:

adequate accounting records have not been •kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; orthe parent company financial statements •and the part of the Directors’ Remuneration Report to be audited are not in agreement with the accounting records and returns; orcertain disclosures of directors’ remuneration •specified by law are not made; orwe have not received all the information and •explanations we require for our audit; ora corporate governance statement has not •been prepared by the parent company.

Under the Listing Rules we are required to review:

the directors’ statement, set out on •pages 56 and 57, in relation to going concern; andthe parts of the Corporate Governance •Statement relating to the Company’s compliance with the nine provisions of the June 2008 Combined Code specified for our review.

Jonathan Hook (Senior Statutory Auditor)for and on behalf of PricewaterhouseCoopers LLPChartered Accountants and Statutory AuditorsLondon16 June 2010

Finan

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Financial Statements

Financial Statements74 Consolidated Income Statement75 Consolidated and Parent Company Statements

of Comprehensive Income76 Consolidated and Parent Company Balance Sheet77 Consolidated and Parent Company Statements

of Cash Flows78 Consolidated and Parent Company Statements

of Changes in Equity79 Notes to the Financial Statements122 Five-year Summary

74 Financial Statements


Group Group 2010 2009 Note £m £m Revenue (Group and share of Joint Ventures) 1,418.0 1,532.4 Revenue 3 1,387.9 1,487.2 Cost of sales (854.6) (941.9)Gross profit 533.3 545.3 Administrative expenses (420.3) (442.2)Operating profit 3, 5 113.0 103.1 Profit on disposal of Joint Venture 9 0.1 2.5 Share of post-tax (loss)/profit from Joint Ventures 3, 4 (1.9) 0.2 Profit before interest and tax 111.2 105.8 Finance income 7 3.8 6.7 Finance cost 7 (18.4) (9.8)Net finance cost 7 (14.6) (3.1) Profit before taxation 96.6 102.7 Income tax expense 8 (19.3) (18.5)Profit for the year from continuing operations 77.3 84.2 Discontinued operations 10 25.0 –

Profit for the year attributable to owners of the parent 102.3 84.2

Earnings per share From continuing and discontinued operations (total) Basic earnings per share 12 105.2p 86.1pDiluted earnings per share 12 103.1p 84.8p From continuing operations Basic earnings per share 12 79.5p 86.1pDiluted earnings per share 12 77.9p 84.8p The notes on pages 79 to 121 are an integral part of these Financial Statements.

Consolidated Income Statement For the year ended 31 March 2010

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Group Company 2010 2009 2010 2009 Note £m £m £m £m Profit for the year 102.3 84.2 46.8 9.6 Other comprehensive income Actuarial loss on post-employment benefit liabilities 29a (119.7) (88.5) – – Cash flow hedges 2.5 – – –Net differences on exchange (0.2) 12.4 – – Other comprehensive expense for the year net of tax (117.4) (76.1) – – Total comprehensive (expense)/income for the year attributable to owners of the parent (15.1) 8.1 46.8 9.6 Items in the statement above are disclosed net of tax. The income tax relating to each component of other comprehensive income is disclosed in note 8c. The notes on pages 79 to 121 are an integral part of these Financial Statements.

Consolidated and Parent Company Statements of Comprehensive Income For the year ended 31 March 2010



Group Company 2010 2009 2010 2009 Note £m £m £m £m Assets Non-current assets Goodwill 14 62.1 62.3 – – Other intangible assets 16 4.7 9.0 – – Property, plant and equipment 17 38.9 46.6 – – Investments in subsidiaries 18 – – 163.3 148.9 Investments in Joint Ventures 4 1.8 3.9 – – Deferred income tax assets 19 149.4 101.6 – – Derivative financial instruments 20 0.6 – – – Other receivables 21 21.2 12.9 6.4 6.0 278.7 236.3 169.7 154.9 Current assets Inventories 22 0.9 0.3 – – Trade and other receivables 23 300.7 353.7 11.3 11.4 Financial assets at fair value through profit or loss 24 32.4 28.7 – – Cash and cash equivalents 25 260.3 209.7 – – Derivative financial instruments 20 1.3 – – – 595.6 592.4 11.3 11.4 Liabilities Current liabilities Borrowings 26 (4.4) (7.6) – – Trade and other payables 27 (434.3) (478.7) (44.3) (57.5)Derivative financial instruments 20 – (0.8) – – Current income tax liabilities (34.6) (31.2) – – Provisions for other liabilities and charges 28 (5.6) (9.9) – – (478.9) (528.2) (44.3) (57.5)Net current assets/(liabilities) 116.7 64.2 (33.0) (46.1) Non-current liabilities Borrowings 26 (7.0) (9.5) – – Provisions for other liabilities and charges 28 (17.0) (17.8) – – Post-employment benefit liabilities 29 (450.5) (311.5) – – Derivative financial instruments 20 – (0.4) – – Other non-current liabilities 30 (5.8) (4.8) – – (480.3) (344.0) – – Net (liabilities)/assets 3 (84.9) (43.5) 136.7 108.8 Capital and reserves Ordinary shares 31 0.5 0.5 0.5 0.5 Share premium account 62.4 62.4 62.4 62.4 Merger reserve 8.9 8.9 8.9 8.9 Retained (loss)/earnings (156.7) (115.3) 64.9 37.0 Equity shareholders’ (deficit)/funds (84.9) (43.5) 136.7 108.8 Keith Clarke Heath Drewett Director Director Approved by the Board on 16 June 2010. The notes on pages 79 to 121 are an integral part of these Financial Statements.

Consolidated and Parent Company Balance Sheets As at 31 March 2010



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Group Company 2010 2009 2010 2009 Note £m £m £m £m Cash flows from operating activities Cash generated from operations 33 126.5 125.5 33.3 28.7 Interest received 3.4 6.3 – 0.4 Interest paid (1.1) (2.2) – – Income tax paid (18.0) (12.8) – – Net cash generated from operating activities 110.8 116.8 33.3 29.1 Cash flows from investing activities Distributions received from Joint Ventures – 1.3 – – Investments in subsidiary companies – – (7.6) (9.6)Acquisitions of subsidiaries – Consideration 15 – (3.5) – – – Cash acquired 15 – 1.0 – – Deferred consideration payments (0.9) (0.8) – – Loans to Joint Ventures and other related parties (7.9) (6.9) – – Repayment of Joint Venture loans 2.1 – – –Purchases of property, plant and equipment (8.4) (18.2) – – Proceeds from disposals of property, plant and equipment 1.1 1.1 – – Proceeds from disposals of investments in subsidiaries – 0.2 – – Proceeds from disposals of investments in Joint Ventures 9 0.1 2.5 – – (Purchases)/disposals of financial assets (3.7) 1.0 – – Purchases of intangible assets (3.5) (10.5) – – Net cash used in investing activities (21.1) (32.8) (7.6) (9.6) Cash flows from financing activities Repayment of short-term loans (2.7) (4.3) – – Finance lease principal payments (4.9) (4.5) – – Purchase of own shares by Employee Benefit Trusts (7.2) – – – Share buybacks – (12.3) – (12.3)Equity dividends paid to shareholders 11 (25.7) (24.7) (25.7) (24.7)Loans from Group companies – – – 10.4 Net cash used in financing activities (40.5) (45.8) (25.7) (26.6) Net increase/(decrease) in cash, cash equivalents and bank overdrafts 49.2 38.2 – (7.1) Cash, cash equivalents and bank overdrafts at beginning of year 209.7 154.5 – 7.1 Exchange movements 1.4 17.0 – – Cash, cash equivalents and bank overdrafts at end of year 25 260.3 209.7 – – The notes on pages 79 to 121 are an integral part of these Financial Statements.

Consolidated and Parent Company Statements of Cash Flows For the year ended 31 March 2010



Retained Share Share Merger (loss)/ capital premium reserve earnings Total £m £m £m £m £mGroup Balance at 1 April 2008 0.5 62.4 8.9 (95.2) (23.4)Total comprehensive income for the year – – – 8.1 8.1 Dividends – – – (24.7) (24.7)Share-based payments – – – 8.0 8.0 Share buyback – – – (11.5) (11.5)Balance at 31 March 2009 0.5 62.4 8.9 (115.3) (43.5) Total comprehensive expense for the year – – – (15.1) (15.1)Dividends – – – (25.7) (25.7)Share-based payments – – – 6.6 6.6 Employee Benefit Trusts – – – (7.2) (7.2)Balance at 31 March 2010 0.5 62.4 8.9 (156.7) (84.9) Company Balance at 1 April 2008 0.5 62.4 8.9 55.1 126.9 Total comprehensive income for the year – – – 9.6 9.6 Share-based payments – – – 8.5 8.5 Dividends – – – (24.7) (24.7)Share buyback – – – (11.5) (11.5)Balance at 31 March 2009 0.5 62.4 8.9 37.0 108.8 Total comprehensive income for the year – – – 46.8 46.8 Share-based payments – – – 6.8 6.8 Dividends – – – (25.7) (25.7)Balance at 31 March 2010 0.5 62.4 8.9 64.9 136.7

The notes on pages 79 to 121 are an integral part of these Financial Statements.

Consolidated and Parent Company Statements of Changes in Equity For the year ended 31 March 2010



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1. Accounting policiesWS Atkins plc is a public limited company which is listed on the London Stock Exchange and is incorporated and domiciled in England and Wales. The address of its registered office is Woodcote Grove, Ashley Road, Epsom, Surrey KT18 5BW, England.

Basis of preparationThe Consolidated Financial Statements of WS Atkins plc have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU), IFRIC interpretations and the Companies Act 2006 applicable to companies reporting under IFRS. The Consolidated Financial Statements have been prepared under the historical cost convention, as modified by the valuation of pensions, share-based payments and financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss. The preparation of Financial Statements in conformity with IFRS requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Financial Statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates. Material estimates applied across the Group’s businesses and Joint Ventures are reviewed to a common standard and adjusted where appropriate to ensure that consistent treatment of similar and related issues that require judgement is achieved upon consolidation. Any revisions to estimates are recognised prospectively.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Consolidated Financial Statements, are disclosed under ‘Critical Accounting Policies’ on page 33 of the Business Review.

Basis of consolidationThe accounting policies have been consistently applied to all the periods presented including the application of new IFRSs and interpretations.

The Consolidated Income Statement and Balance Sheet include the accounts of the Company, its subsidiary undertakings and its share of Joint Ventures. The results of the subsidiary undertakings acquired during the year are included in the income statement from the date of acquisition. The results of subsidiary undertakings disposed of during the year are included in the income statement up to the date of disposal.

Subsidiaries are entities that are directly or indirectly controlled by the Group. Control exists where the Group has the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities. In assessing control, potential voting rights that are currently exercisable or convertible are taken into account. The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the income statement. Goodwill is reviewed on finalisation of fair values and any adjustments required to the accounting are recorded within 12 months of the acquisition date.

Where subsidiaries adopt accounting policies that are different from the Group, their reported results are restated to comply with the Group’s accounting policies. All intra-group transactions and balances are eliminated on consolidation. Where subsidiaries do not adopt accounting periods that are co-terminous with the Group’s, results and net assets are based upon accounts drawn up to the Group’s accounting reference date based on unaudited accounts.

Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred.

The accounts of the Employee Benefit Trusts (EBTs) are incorporated into the results of the Group as, although they are administered by independent trustees and their assets are held separately from those of the Group, in practice the Group’s advice on how the assets are used for the benefit of employees is normally accepted. The Group bears the major risks and rewards of the assets held by the EBTs until the shares vest unconditionally with the employees. Shares in WS Atkins plc held by the EBTs are shown as a reduction in retained loss/earnings. Other assets and liabilities held by the EBTs are consolidated with the assets of the Group.

Notes to the Financial StatementsFor the year ended 31 March 2010



Foreign currency transactions and translationFunctional and presentation currencyItems included in the Financial Statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The Consolidated Financial Statements are presented in pounds sterling (‘£’), which is the Company’s and Group’s functional and presentation currency. Transactions and balancesForeign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.

Group companiesAssets and liabilities of overseas subsidiaries are translated at the closing rates of exchange at the balance sheet date. Trading results of overseas subsidiaries are translated at average rates of exchange. Differences resulting from the retranslation of opening net assets and results for the period at closing rates are taken to the statement of comprehensive income.

Operating segmentsIFRS 8, Operating segments, replaces IAS 14, Segment reporting. It requires a ‘management approach’ under which segment information is presented on the same basis as that used for internal reporting purposes. This has resulted in an increase in the number of reportable segments presented as the previously reported Middle East, China and Europe segment has been split into Middle East and China and Europe.

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (CODM). The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the chief executive and the Group finance director.

The Group is organised into seven operating segments for management purposes, reflecting its key markets and service offerings. The segments are: Design and Engineering Solutions; Highways and Transportation; Rail; Middle East; China and Europe; Management and Project Services; and Asset Management. These segments form the basis for reporting the Group’s segment information as it is the main determinant of the Group’s risks and returns. The Group considers the United Kingdom to be its country of domicile. No other single country contributes more than 10% of the Group’s revenue or non-current assets.

Inter-segment transfers and transactions are entered into under the normal commercial terms and conditions that would also be available to unrelated third parties.

RevenueRevenue from long-term contracts comprises the value of work performed during the period calculated in accordance with the Group’s policy for contract accounting set out below. Revenue from other contract activities represents fee income receivable in respect of services provided during the period.

Under certain services contracts, the Group manages customer expenditure and is obliged to purchase goods and services from third-party contractors and recharge them on to the customer at cost. The amounts charged by contractors and recharged to customers are excluded from revenue and cost of sales where the Group is acting as an agent. Receivables, payables and cash relating to these transactions are included in the Consolidated Balance Sheet.

Revenue recognition and contract accountingThe value of contract work in progress comprises the costs incurred on contracts plus an appropriate proportion of overheads and attributable profit. Fees invoiced on account are deducted from the value of work in progress and the balance is separately disclosed in trade and other receivables as amounts recoverable on contracts, unless such fees exceed the value of the work in progress on any contract when the excess is separately disclosed in trade and other payables as fees invoiced in advance.

Profit is recognised on a percentage completion basis when the outcome of a contract or project can be reasonably foreseen. Provision is made in full for estimated losses. Where the outcome of a contract cannot be reasonably foreseen, profit is taken on completion. Where contracts span two or more accounting periods, profit is not generally recognised until the contract is 50% complete.

Revenue recognition on outsourcing contracts is determined by reference to the proportion of the annual service delivered to date. Where the costs of obligations in relation to the non-renewal or termination of a contract are higher in the final period of the contract a proportion of revenue is deferred each period to meet these anticipated costs. Full provision is made for losses on outsourcing contracts if the forecast costs of fulfilling the contract throughout the contract period exceed the forecast income receivable. In assessing the amount of the loss to provide on an outsourcing contract, account is taken of the Group’s share of the forecast results from any Joint Ventures which the contract is servicing.

Notes to the Financial Statementscontinued



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Interest income is recognised on a time-apportionment basis using the effective interest method. When a receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is recognised using the original effective interest rate.

Dividend income is recognised when the right to receive payment is established.

Pre-contract costsThe Group accounts for all pre-contract costs in accordance with IAS 11, Construction contracts. Costs incurred before it becomes probable that a contract will be obtained are charged to expenses. Directly attributable costs incurred after that point are recognised in the balance sheet and charged to the income statement over the duration of the contract or, in the case of PPP/PFI concessions, over the same period as the Group’s interest in any Special Purpose Company (SPC) charges the equivalent capitalised amounts to the income statement.

Bid recovery fees are deferred and credited to the income statement over the duration of the contract or, in the case of PPP/PFI concessions, over the same period as the Group’s interest in any SPC charges the equivalent capitalised amounts to the income statement. Where the Group’s interest in any SPC reduces, the deferred bid recovery fees are credited to the income statement in proportion to the reduction of the Group’s interest.

Exceptional itemsWhere certain expense or revenue items recorded in a period are material by their size or incidence, the Group reflects such items as exceptional items and these are shown separately in the income statement.

Exceptional items are also summarised by class in the segmental analyses, excluding those that relate to interest and tax.

Retirement benefit schemesThe Group operates defined contribution and defined benefit pension schemes which require payments to be made into separately administered funds. For defined benefit schemes, regular valuations are prepared by independent professionally qualified actuaries to determine the level of contributions required to fund the benefits set out in the scheme rules.

The Group accounts for pensions in accordance with IAS 19, Employee benefits. The cost of the defined contribution schemes is charged to operating profit as incurred. The cost of the defined benefit schemes is charged as follows:

the current service cost incurred during the period to provide retirement benefits to employees is charged to operating profit•

gains or losses arising from settlements or curtailments not covered by actuarial assumptions are included in operating profit•

a charge representing the expected increase in scheme liabilities is included in net finance costs. This is based on the present value of scheme •liabilities at the beginning of the period

a credit representing the expected return on scheme assets is included within net finance costs. This is based on the market value of the assets •of the schemes at the start of the period allowing for expected cash flows during the period.

For defined benefit schemes, all actuarial gains and losses (asset experience, liability experience and changes in assumptions) are recognised immediately in the statement of comprehensive income. The difference between the market value of scheme assets and the present value of scheme liabilities is recognised as a retirement benefit asset or liability on the Consolidated Balance Sheet. To the extent that it is recoverable, any related deferred tax asset or liability is included in the relevant category of receivable/payable.

The Group has elected to recognise actuarial gains and losses in full as they arise through retained loss/earnings.

Share-based paymentsIn accordance with IFRS 2, Share-based payments, the cost of share-based payments awarded after 7 November 2002 is charged to the income statement over the performance and vesting periods of the instruments. The cost is based on the fair value of the awards made at the date of grant adjusted for the number of awards expected to vest. In accordance with the transitional provisions within IFRS 2, no charge is made in respect of instruments awarded before 7 November 2002. The credits associated with the amounts charged to the income statement are included in retained earnings/loss until the awards are exercised. Where awards are settled by new issue shares any proceeds received in respect of share options are credited to share capital and share premium. Where awards are settled in shares held by the EBTs any proceeds are credited to retained earnings/loss.

Share awards are granted by the Parent Company to employees of its subsidiaries. The Company charges to cost of investment in subsidiaries an amount equivalent to the equity-settled element of the annual IFRS 2 charge, with an equivalent credit to reserves in accordance with IFRIC 11, Group and treasury share transactions.



Joint Ventures In accordance with IAS 31, Interests in Joint Ventures, the Group accounts for Joint Ventures under the equity method of accounting. The Group’s share of a Joint Venture’s profit after tax is included from the date on which the Group acquires joint control. Within the Consolidated Balance Sheet the investment is recorded at cost (classified as a non-current asset) and subsequently adjusted to reflect the Group’s share of the movements in the Joint Venture’s net assets post acquisition.

The results, assets and liabilities of Joint Ventures are stated in accordance with Group accounting policies. Where Joint Ventures adopt accounting policies that are different from the Group, their reported results are restated to comply with the Group’s accounting policies.

Where Joint Ventures do not adopt accounting periods that are co-terminous with the Group’s, results and net assets are based upon unaudited accounts drawn up to the Group’s accounting reference date.

PPP/PFI concessionsAssets constructed by PPP/PFI concession companies are classified in the accounts of the Joint Ventures as financial assets or intangible assets, depending on whether the grantor or user has the primary responsibility to pay the operator for the concession services. To date, all of the Group’s PPP/PFI concession assets have been classed as financial assets.

The financial asset represents an interest-bearing, long-term receivable. The cost of the financial asset at any one time is equal to the accumulated value of service delivery plus accumulated interest charged to the financial asset less amounts received to date.

The financial asset is measured at fair value. Where it is classed as a loan receivable any movement in fair value is taken to the income statement. Where it is classed as available for sale any movement in fair value is taken to reserves.

Revenue is recognised at the fair value of the consideration received for goods and services provided in the normal course of business net of value-added tax rebates and discounts. Revenue from contracting activities represents the value of work carried out during the year including amounts not invoiced. Interest income is accrued on a time basis by reference to the principal outstanding and the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying value amount.

Where the outcome of a construction contract can be measured reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the balance sheet date as measured by the contract costs incurred. Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent that it is probable that contract costs incurred will be recovered.

When it is probable that the total contract costs will exceed total contract revenue, the expected resultant loss is recognised as an expense immediately.

Income taxCurrent and deferred income tax are recognised in the income statement for the period except where the taxation arises as a result of a transaction or event that is recognised directly in equity. Income tax arising on transactions or events recognised directly in equity is charged or credited directly to equity.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the Consolidated Financial Statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

No deferred tax is recognised on the unremitted earnings of overseas subsidiaries and Joint Ventures.




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Intangible assetsGoodwillGoodwill is stated at cost less impairment. Prior to 1 April 2004, goodwill was amortised over its estimated useful economic life. Amortisation ceased on 1 April 2004 and the carrying value of existing goodwill was frozen at that date and subject to annual impairment review.

On acquisition of a business, fair values are attributed to the assets, liabilities and contingent liabilities of the acquired business at the date of acquisition. Goodwill arises when the fair value of the consideration given for a business exceeds the fair value of the net assets. In accordance with IFRS 3, Business combinations, goodwill arising on acquisitions is capitalised and is subject to impairment review both annually and when there are indications that the carrying value may not be recoverable.

Goodwill that arose prior to 1 April 1997 was written off to retained earnings/loss. Profit or loss on disposal of the underlying businesses to which this goodwill related will not include goodwill previously recorded as a deduction from equity.

Acquired customer relationshipsAcquired customer relationships consist of intangible assets arising on the consolidation of recently acquired business, principally future order books, that do not appear within the balance sheet of the acquired entity itself, and which are separable from goodwill in accordance with IFRS 3, Business combinations and IAS 38, Intangible assets. Customer relationships are amortised on a straight-line basis over their useful economic lives of between one and three years.

Corporate information systemsIn accordance with IAS 38, Intangible assets, the Group’s corporate information systems are treated as an intangible asset. Costs included are those directly attributable to the design, construction and testing of new systems (including major enhancements and internally generated costs) from the point of inception to the point of satisfactory completion where the probable future economic benefits arising from the investment can be assessed with reasonable certainty at the time the costs are incurred. Maintenance and minor modifications are expensed in the income statement as incurred. The corporate information systems are amortised on a straight-line basis over their estimated useful economic life of six years.

Software licencesAcquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring into use the specific software. These costs are amortised on a straight-line basis over their useful lives of between two and five years.

Property, plant and equipmentProperty, plant and equipment is carried at cost less accumulated depreciation and impairment. Cost comprises purchase price after discounts and rebates plus all directly attributable costs of bringing the asset to working condition for its intended use.

Property, plant and equipment is depreciated on a straight-line basis calculated at annual rates to write off the cost less residual value of each asset over the term of its estimated useful economic life as follows:

Freehold buildings – 10 to 50 yearsShort leasehold – over the life of the leasePlant and machinery – 3 to 10 yearsSpecial-purpose industrial motor vehicles – 3 to 12 yearsOther motor vehicles – 3 to 4 yearsInformation technology – 2½ to 5 years

No depreciation is provided in respect of freehold land.

The directors annually review the estimated useful economic lives and residual values of property, plant and equipment.

ImpairmentAssets that have an indefinite useful life are not subject to amortisation and are reviewed for impairment annually and when there are indications that the carrying value may not be recoverable. Assets that are subject to amortisation are reviewed for impairment wherever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of the fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

Investments in subsidiariesInvestments in subsidiaries are stated at cost less impairments.




Financial assetsThe Group classifies its financial assets into the following two categories: at fair value through profit or loss and loans and receivables.

Financial assets at fair value through profit or lossThe fair value of financial instruments traded in active markets (Level 1) is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from on exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arms length basis. The quoted market price used by the Group is the mid-market price.

The fair values of financial instruments that are not traded in an active market (Level 2) are determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on estimates.

Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included within current assets except where the maturity is greater than 12 months after the balance sheet date in which case they are included as non-current assets. The Group’s loans and receivables consist of trade and other receivables and cash and cash equivalents, which are shown separately within the balance sheet. Trade receivables are recognised at original invoice amount less provision for impairment, which, due to their short-term nature, approximates to their fair value.

Other receivables include loan notes receivable in respect of disposals, which are measured at amortised cost using the effective interest method less any provision for impairment. This valuation approximates to their fair value.

The Group assesses at each balance sheet date whether there is objective evidence that a financial asset or group of financial assets is impaired. Any impairment is charged to the income statement. Impairment testing for trade receivables is described below in the accounting policy paragraph relating to trade receivables.

InventoriesInventories are stated at cost less impairment. Cost is calculated on a first-in, first-out basis.

Trade receivables Trade receivables are recognised at original invoice amount. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the trade receivable is impaired.

Cash and cash equivalentsCash and cash equivalents comprise cash in hand, demand deposits and short-term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Derivative financial instruments and hedge accountingDerivative financial instruments are initially accounted for and measured at fair value on the date a contract is entered into and are subsequently re-measured at fair value.

Where a derivative is designated as a fair value hedge and is assessed as being effective in accordance with IAS 39 Financial instruments: recognition and measurement, the gain or loss on re-measurement is recognised in the income statement together with the corresponding changes in the fair value of the hedged item that are attributable to the hedged risk.

Where a derivative is designated as a cash flow hedge and is assessed as being effective in accordance with IAS 39, the gain or loss on re-measurement is recognised in equity. Amounts accumulated in equity are transferred to the income statement when the underlying transaction being hedged occurs or, if the transaction results in the creation of a non-financial asset or liability, are included in the initial cost of the asset or liability.

Where the derivative is designated as a hedge of the net investment in a foreign operation and is assessed as being effective in accordance with IAS 39, the gain or loss on re-measurement is recognised in equity. Amounts accumulated in equity are transferred to the income statement on disposal of the foreign operation. Similar treatment is applied where the hedge of a net investment in a foreign operation is a non-derivative financial instrument such as a foreign currency loan.

Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognised in the income statement as they arise.



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Lease obligationsFinance leasesLease arrangements that transfer substantially all the risks and rewards of ownership to the lessee are treated as finance leases. Assets held under finance leases are capitalised within property, plant and equipment and depreciated over the shorter of the lease term and the useful life of the asset. A liability is recognised for the present value of the minimum lease payments within current and/or non-current liabilities as appropriate. Rental payments are apportioned between capital and interest expense to achieve a constant rate of interest charge on the outstanding obligation.

Where the Group acts as a lessor in a finance lease, receivables under finance leases represent outstanding amounts due under these agreements less finance charges allocated to future periods. Finance lease interest is recognised over the primary period of the lease so as to produce a constant rate of return on the net cash investment.

Operating leasesWhere the Group acts as lessee in an operating lease arrangement, the lease payments are charged as an expense to the income statement on a straight-line basis over the lease term. Lease incentives received are also recognised on a straight-line basis over the lease term.

Where the Group acts as lessor in an operating lease arrangement, rental income from operating leases is accounted for on a straight-line basis over the period of the lease. Lease incentives provided are also recognised over the lease term on a straight-line basis.

Trade payables Trade payables are recognised at original invoice amount.

Share capitalOrdinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Provisions for other liabilities and chargesOnerous contract provisions are recognised for losses on contracts where the forecast costs of fulfilling the contract throughout the contract period exceed the forecast income receivable. In assessing the amount of the loss to provide on any contract, account is taken of the Group’s share of the forecast results from any Joint Ventures which the contract is servicing. The provision is calculated based on discounted cash flows to the end of the contract.

Vacant property provisions are recognised when the Group has committed to a course of action that will result in the property becoming vacant. The provision is calculated based on discounted cash flows to the end of the lease.

Dividend distributionDividend distribution to the Company’s shareholders is recognised as a liability in the Group’s Financial Statements in the period in which the dividends are approved by the Company’s shareholders. Interim dividends are recognised when paid.

Application of new IFRSs and interpretations(a) The following standards, amendments to standards and interpretations are effective in the current financial year and have

been adopted by the Group:

IFRS 8, • Operating segments (effective 1 January 2009) – IFRS 8 replaces IAS 14, Segment reporting. It requires a ‘management approach’ under which segment information is presented on the same basis as that used for internal reporting purposes. The impact of these changes is detailed in the operating segments accounting policy.

IAS 1 (revised), • Presentation of financial statements (effective 1 January 2009) – The revised standard prohibits the presentation of items of income and expenses (that is, ‘non-owner changes in equity’) in the statement of changes in equity, requiring ‘non-owner changes in equity’ to be presented separately from owner changes in equity in a statement of comprehensive income. As a result the Group presents in the Consolidated Statement of Changes in Equity all owner changes in equity, whereas all non-owner changes in equity are presented in the Consolidated Statement of Comprehensive Income. Comparative information has been re-presented so that it is also in conformity with the revised standard. As the change in accounting policy only impacts presentation aspects, there is no impact on earnings per share.

Amendment to IFRS 7, • Financial instruments: Disclosures (effective 1 January 2009) – The amendment requires enhanced disclosures about fair value measurement and liquidity risk. In particular, the amendment requires disclosure of fair value measurements by level of a fair value measurement hierarchy.




(b) The following standards, amendments to standards and interpretations are effective in the current financial year but have not had a material impact on the Financial Statements of the Group:

IAS 23 (revised), • Borrowing costs (effective 1 January 2009)

Amendment to IAS 32, • Financial instruments: Presentation (effective 1 January 2009)

Amendment to IFRS 2, • Share based payments (effective 1 January 2009)

Amendment to IFRIC 9 and IAS 39 regarding embedded derivatives (effective 1 July 2008)•

IFRIC 13, • Customer loyalty programmes relating to IAS 18, Revenue (effective 1 July 2008)

IFRIC 14, IAS 19, • The limit on defined benefit assets, minimum funding requirements and their interaction (effective 1 January 2008, but EU endorsed for use 1 January 2009)

IFRIC 15, • Agreements for construction of real estates (effective 1 January 2009, but EU endorsed for use 1 January 2010)

IFRIC 16, • Hedges of a net investment in a foreign operation (effective 1 October 2008, but EU endorsed for use 1 July 2009)

(c) The following standards, amendments to standards and interpretations are not yet effective and have not been early adopted by the Group:

IFRS 3 (revised), • Business combination (effective 1 July 2009)

IAS 27 (revised), • Consolidated and separate financial statements (effective 1 July 2009)

Amendment to IAS 39, • Financial Instruments: Recognition and measurement on eligible hedged items (effective 1 July 2009)

Amendments to IFRS 2, • Share based payments (effective 1 January 2010)

Amendments to IFRS 1, • First time adoption – additional exemptions (effective 1 January 2010)

Amendment to IAS 32, • Financial instruments: Presentation (effective 1 February 2010)

Amendment to IFRS 1, • First time adoption – financial instrument disclosures (effective 1 July 2010)

Amendment to IAS 24, • Related party disclosures (effective 1 January 2011)

IFRS 9, • Financial instruments – classification and measurement (effective 1 January 2013)

IFRIC 17 • Distributions of non-cash assets to owners (effective 1 July 2009)

IFRIC 18 • Transfer of assets from customers (effective 1 July 2009)

IFRIC 19 • Extinguishing financial liabilities with equity instruments (effective 1 July 2010)

Amendments to IFRIC 14, • Prepayments of a minimum funding requirement (effective 1 January 2011)



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2. Financial risk managementRisk factorsThe Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance. The Group uses derivative financial instruments to hedge certain risk exposures.

Risk management is carried out by a central treasury department (Group Treasury) under policies approved by the Board of directors. Group Treasury identifies, evaluates and hedges financial risks in close cooperation with the Group’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

These policies are further described within the Treasury policies and objectives section of the Business Review.

Where individual sensitivities are disclosed below, all other variables are held constant.

a) Market riski) Foreign exchange riskThe Group operates in a number of international territories. Each business undertakes a large proportion of its commercial transactions within its local market and in its local functional currency. Foreign exchange risk arises from the small proportion of commercial transactions undertaken in currencies other than the local functional currency, from financial assets and liabilities denominated in currencies other than the local functional currency and on the Group’s net investments in foreign operations.

Group policy is for each business to undertake commercial transactions in its own functional currency whenever possible. When this is not possible, the Group manages its foreign exchange risk from future commercial transactions using appropriate derivative contracts arranged via Group Treasury. Cash flows are reviewed on a monthly basis throughout the duration of projects and the future cover amended as appropriate.

Trade receivables and payables denominated in currencies other than the local functional currency arise from commercial transactions and are therefore largely hedged as part of the process described above. Remaining financial assets and liabilities denominated in currencies other than the local functional currency include bank accounts, loans and intercompany funding balances. These are unhedged, with the exception of balances that are themselves designated as hedging instruments used to hedge the Group’s net investment in foreign operations.

The Group’s primary exposure to foreign exchange rate risk on unhedged financial instruments arises mainly in respect of movements between the US dollar (including dollar-pegged currencies) and sterling and between the euro and sterling. At 31 March 2010, if sterling had strengthened/weakened by 10% against the US dollar, then profit after tax would be higher/lower by approximately £0.1m (2009: £0.1m lower/higher) and equity would be £0.1m higher/lower (2009: £0.1m lower/higher). If sterling had strengthened/weakened by 10% against the euro then profit after tax would be lower/higher by approximately £0.5m (2009: £0.5m lower/higher) and equity would be £0.5m lower/higher (2009: £0.5m lower/higher).

ii) Interest rate riskThe Group’s exposure to interest rate risk arises from loan notes, cash and cash equivalents and financial assets at fair value through profit or loss which are all interest bearing, offset in part by interest bearing borrowings. The majority of items included in the above are at floating rates of interest or fixed deposits for periods of less than six months; changes in the interest rate result in changes in interest-related cash flows. No interest hedging is currently undertaken by the Group or its subsidiaries. If interest rates for the year to 31 March 2010 had been 10 basis points higher/lower, then profit after tax for the year would have been approximately £0.2m (2009: £0.2m) higher/lower, principally due to increased interest received on short-term bank deposits.

iii) Price riskThe Group does not have any equity securities in its balance sheet and is not materially exposed to commodity price risk. Certain longer term project and framework contracts include indexation clauses that are applied to unit rates to offset the effect of inflation on input costs over the duration of the agreement. The Group is exposed to price risk to the extent that inflation differs from the index used and forecast project outcomes that form the basis of revenue recognition include an estimate of this risk where it is present.




b) Credit riskCredit risk is the risk that the Group will suffer financial loss as a result of counterparties defaulting on their contractual obligations. The risk arises on financial instruments at fair value through profit or loss, cash and cash equivalents and trade and other receivables, with the maximum exposure to risk equivalent to 100% of the carrying value disclosed in the Group’s Balance Sheet at 31 March. The Group does not hold any collateral as security. The majority of the Group’s cash deposits are placed with its relationship banks, which carry at least an A-1/P1 credit rating. For deposits and money market investments placed with banks and financial institutions, only independently rated parties with a minimum rating of A are accepted. Investments carry a minimum credit rating of A-1/P1. Cash and investments are not concentrated with any one counterparty.

For trade and other receivables, an assessment of credit quality of the customer is made where appropriate using a combination of external rating agencies, past experience and other factors. In circumstances where credit information is unavailable or poor, the risk is mitigated by use of advance payments and, by exception, through credit risk insurance. Exposure and payment performance are monitored closely both at individual project and client level, with a series of escalating debt recovery actions taken where necessary. The Group’s customer base is broad and dispersed. In view of current economic circumstances additional management attention has been focused on the recovery of debtors, in particular within the Middle East.

c) Liquidity riskThe Group funds its activities through cash generated from its operations and, where necessary, bank borrowings and finance leases. The Group’s banking facilities include cash facilities and bank guarantees. Cash flow forecasts are prepared covering various periods from short to long term to ensure that sufficient funds are available to meet the Group’s commitments as they fall due.

The table below analyses the maturity profile of the Group’s non-derivative financial liabilities:

On demand or within Between Between 2 Over 5 Carrying 1 year 1 and 2 years and 5 years years Discount value2010 £m £m £m £m £m £mHire purchase and finance leases 4.2 2.3 4.1 0.8 (0.7) 10.7 Loan notes 0.8 – – – (0.1) 0.7 Trade payables 50.6 – – – – 50.6 On demand or within Between Between 2 Over 5 Carrying 1 year 1 and 2 years and 5 years years Discount value2009 £m £m £m £m £m £m Hire purchase and finance leases 5.4 3.6 4.2 1.2 (0.7) 13.7Loan notes 2.9 0.7 – – (0.2) 3.4 Trade payables 64.4 – – – – 64.4

d) Concentrations of financial instrumentsThe carrying amounts of the Group’s financial assets and liabilities, excluding derivative financial instruments, were denominated in the following currencies: 2010 2009 Financial Financial Financial Financial assets liabilities assets liabilities £m £m £m £mSterling 315.0 43.7 327.3 57.2UAE dirham 56.8 3.7 67.6 7.8US dollar 43.0 2.3 37.9 3.0Euro 25.6 3.1 22.8 4.0HK dollar 18.8 0.3 15.2 2.5China RMB 18.1 0.9 14.2 0.5Qatari rial 17.8 0.9 6.0 0.3Denmark krone 12.7 4.1 11.2 3.3 Other 39.2 3.0 32.3 2.9Total 547.0 62.0 534.5 81.5

The financial assets and liabilities of the Company are all denominated in sterling.

Financial assets consist of acquired loan notes; trade receivables (net); intercompany receivables (nil in consolidated accounts); amounts due from Joint Ventures; financial assets at fair values through profit or loss; and cash and cash equivalents. Financial liabilities consist of trade payables; intercompany payables (nil in consolidated accounts); amounts due to Joint Ventures; and borrowings.



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Capital risk managementThe Group manages its capital to ensure that it is able to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders, and to minimise its cost of capital by maintaining an optimal capital structure.

The Group maintains or adjusts its capital structure through the payment of dividends to shareholders, issues of new shares and buyback of existing shares, and through its loan facility.

For capital management purposes, the Group monitors the ratio of its net debt plus defined benefit pension deficit net of deferred tax to EBITDA. This policy is unchanged from the prior year. Total capital is calculated as equity as shown in the Consolidated Balance Sheet plus net debt.

The Group’s banking facilities include a number of financial and non-financial covenants. Compliance with these covenants is monitored and as at 31 March 2010 and since, none of the covenants had been breached.

3 Segment informationThe chief operating decision-maker has been identified as the chief executive and the Group finance director. The chief executive and the Group finance director review the Group’s internal reporting in order to assess performance and allocate resources. Management has determined the operating segments based on these reports.

The chief executive and the Group finance director assess the performance of the operating segments based on operating profit before interest and tax. Information provided to the chief executive and Group finance director is measured in a manner consistent with that in the Financial Statements.

The segmental results for the comparative period to 31 March 2009 has been restated under IFRS 8, Operating segments.

a) Group business segmentsRevenue and results Share of post-tax Inter- profit/(loss) Total segment Operating Operating from Joint revenue revenue Revenue profit/(loss) margin Ventures 2010 £m £m £m £m % £mDesign and Engineering Solutions 442.5 (52.2) 390.3 31.3 8.0 – Highways and Transportation 319.6 (19.2) 300.4 21.4 7.1 0.2 Rail 190.7 (5.0) 185.7 16.8 9.0 – Middle East 150.0 (13.4) 136.6 14.0 10.2 – China and Europe 143.2 (9.1) 134.1 6.1 4.5 – Management and Project Services 217.6 (14.8) 202.8 15.9 7.8 (0.1)Asset Management 58.0 (2.0) 56.0 5.0 8.9 – Total for segments 1,521.6 (115.7) 1,405.9 110.5 7.9 0.1

Group items:Joint Ventures reported above (18.0) – (18.0) (0.1) – Unallocated central items – – – 2.6 (2.0)Total for Group 1,503.6 (115.7) 1,387.9 113.0 8.1 (1.9)




Share of post-tax Inter- profit/(loss) Total segment Operating Operating from Joint revenue revenue Revenue profit/(loss) margin Ventures 2009 £m £m £m £m % £mDesign and Engineering Solutions 451.9 (16.9) 435.0 31.6 7.3 0.1 Highways and Transportation 328.0 (19.8) 308.2 19.9 6.5 (0.4) Rail 210.2 (14.1) 196.1 17.0 8.7 – Middle East 206.0 (20.0) 186.0 17.3 9.3 – China and Europe 123.9 (6.7) 117.2 4.9 4.2 – Management and Project Services 241.0 (11.0) 230.0 18.9 8.2 – Asset Management 50.5 (2.9) 47.6 (6.8) (14.3) – Total for segments 1,611.5 (91.4) 1,520.1 102.8 6.8 (0.3)

Group items: Joint Ventures reported above (32.9) – (32.9) 0.3 –Unallocated central items – – – – 0.5 Total for Group 1,578.6 (91.4) 1,487.2 103.1 6.9 0.2

Total segment revenue excludes the share of Joint Venture earned from centrally managed Joint Ventures of £12.1m (2009: £12.3m).

Reconciliation of segmental analysis to profit for the year attributable to owners of the parent: 2010 2009 £m £mOperating profit 113.0 103.1

Profit on disposal of Joint Venture 0.1 2.5Share of post-tax (loss)/profit from Joint Ventures (1.9) 0.2Profit before interest and tax 111.2 105.8

Finance income 3.8 6.7Finance cost (18.4) (9.8)Net finance cost (14.6) (3.1)

Profit before taxation 96.6 102.7

Income tax expense (19.3) (18.5)Profit for the year from continuing operations 77.3 84.2

Discontinued operations 25.0 –

Profit for the year attributable to owners of the parent 102.3 84.2



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Balance sheet Total Total Investments segment segment Net assets/ in Joint Capital Depreciation assets liabilities (liabilities) Ventures expenditure & amortisation2010 £m £m £m £m £m £mDesign and Engineering Solutions 90.0 (72.0) 18.0 – 1.2 1.4 Highways and Transportation 61.0 (75.2) (14.2) 0.7 2.2 2.5Rail 40.1 (32.7) 7.4 – 0.1 0.5Middle East 149.1 (94.3) 54.8 – 0.1 4.1 China and Europe 96.9 (66.0) 30.9 – 2.2 1.4 Management and Project Services 63.7 (33.9) 29.8 – 0.8 1.6 Asset Management 4.4 (13.7) (9.3) – – 0.1 Total for segments 505.2 (387.8) 117.4 0.7 6.6 11.6

Group items:Unallocated assets/(liabilities) 369.1 (571.4) (202.3) 1.1 7.4 11.2 Total for Group 874.3 (959.2) (84.9) 1.8 14.0 22.8

Total Total Investments segment segment Net assets/ in Joint Capital Depreciation assets liabilities (liabilities) Ventures expenditure & amortisation2009 £m £m £m £m £m £mDesign and Engineering Solutions 122.0 (87.4) 34.6 – 5.1 3.6 Highways and Transportation 60.3 (68.2) (7.9) 0.6 4.9 2.3 Rail 57.1 (37.6) 19.5 – 0.2 0.7 Middle East 191.6 (117.2) 74.4 – 5.4 4.6 China and Europe 81.9 (48.1) 33.8 – 3.7 3.5 Management and Project Services 72.8 (37.8) 35.0 0.1 1.6 2.4 Asset Management (1.8) (13.5) (15.3) – – 0.1 Total for segments 583.9 (409.8) 174.1 0.7 20.9 17.2

Group items:Unallocated assets/(liabilities) 244.8 (462.4) (217.6) 3.2 14.9 16.2 Total for Group 828.7 (872.2) (43.5) 3.9 35.8 33.4

Unallocated assets consist primarily of goodwill, deferred tax and UK cash and cash equivalents. Unallocated liabilities consist primarily of central creditors and pension liabilities.

Capital expenditure includes additions to goodwill, other intangible assets and property, plant and equipment.

b) Group geographical segmentsExternal revenue is measured by location of operation. There was no material difference between geographic revenue by location of operation and by location of customer.

The Group considers the United Kingdom to be its country of domicile. No other single country contributes more than 10% of the Group’s revenue or non-current assets. Revenue Non-current assets 2010 2009 2010 2009 £m £m £m £mUnited Kingdom 997.7 1,062.2 104.1 103.5Other 390.2 425.0 24.6 31.2 Total for Group 1,387.9 1,487.2 128.7 134.7

Non-current assets exclude deferred tax assets and derivative financial instruments.




c) Major customersRevenue from the UK Government represents approximately £254.8m (2009: £287.6m) of the Group’s total revenue. All reported segments earn revenues from this particular customer with the exception of Middle East and China and Europe.

d) CompanyThe Company’s business is to invest in its subsidiaries and it operates in a single segment.

4. Joint Venturesa) Share of post-tax (loss)/profit from Joint Ventures 2010 2009 £m £mRevenue 30.1 45.2Operating expenditure (30.8) (44.7)Operating (loss)/profit (0.7) 0.5Finance cost (6.2) (5.4)Finance income 4.8 5.1(Loss)/profit before taxation (2.1) 0.2Income tax credit 0.2 –Share of post-tax (loss)/profit from Joint Ventures (1.9) 0.2

b) Investments in Joint Ventures 2010 2009 £m £m Non-current assetsProperty, plant and equipment 1.8 2.1Other non-current assets 70.7 71.2 72.5 73.3

Current assetsCash and cash equivalents 12.0 15.9Other current assets 18.3 16.2 30.3 32.1

Current liabilitiesTrade and other payables (18.0) (12.2) (18.0) (12.2)

Non-current liabilitiesBorrowings (79.2) (86.7)Other non-current liabilities (3.8) (2.6) (83.0) (89.3)

Share of net assets 1.8 3.9Investments in Joint Ventures 1.8 3.9

The Group’s principal Joint Ventures are detailed in note 40.



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5. Operating profit – analysis of costs by nature Group 2010 2009 £m £mOperating profit is arrived at after charging/(crediting): Employee benefit costs (see note 6) 735.9 776.7 Net foreign exchange (gains)/losses (0.6) 0.6Depreciation and impairment of property, plant and equipment: – owned assets (note 17) 12.4 18.2– assets held under finance leases (note 17) 2.9 2.5Loss/(profit) on sale of property, plant and equipment 1.4 0.7Impairment of trade receivables/(reversal of impairment): – increase in provisions (note 23) 27.5 15.4– release of provisions (note 23) (8.0) (3.1)Amortisation of intangibles:– customer relationships (note 16) 0.1 0.5– other assets (note 16) 7.4 12.2Receipts under operating leases:– plant and machinery (1.9) (2.1)– property (1.7) (1.3)Payments under operating leases:– plant and machinery 6.1 6.5– property 30.1 30.7

Company operating profit was arrived at after incurring £0.1m of net foreign exchange losses (2009: £0.1m gain) and £36.1m of realised profit on disposal of investments (2009: £9.5m).

Services provided by the Group’s auditorDuring the year the Group (including its overseas subsidiaries) obtained the following services from the Group’s auditor at costs as detailed below: Group 2010 2009 £m £m Statutory audit of Parent Company’s and Group Financial Statements 0.2 0.2

The audit of accounts of Group companies pursuant to legislation UK 0.5 0.5 Non-UK 0.2 0.2Total audit services 0.9 0.9

Other services pursuant to such legislation 0.1 0.1

Other services relating to taxation 0.3 0.4

Services relating to corporate finance transactions – 0.1

Services relating to pensions 0.1 –

All other services 0.1 –Total non-audit services 0.6 0.6

Total 1.5 1.5

The statutory audit of the Company’s annual accounts was £0.1m (2009: £0.1m). No other services were provided to the Company by the Group’s auditor (2009: nil).

The Atkins Pension Plan is audited by Baker Tilly and the audit fee for 2010 was £30,000 (2009: £29,000). This audit fee was borne by the Group.




6. Employee benefit costs Average Year end 2010 2009 2010 2009 No. No. No. No. Number of full-time equivalent people (including executive directors) employed by the Group By class of business:Design and Engineering Solutions 4,423 4,805 4,155 4,846Highways and Transportation 2,895 2,920 2,844 2,983Rail 1,384 1,531 1,319 1,499Middle East 2,152 2,821 1,866 2,822China and Europe 1,435 1,432 1,404 1,461Management and Project Services 2,008 2,292 1,903 2,169Asset Management 596 658 537 653Corporate 638 588 639 593Group total 15,531 17,047 14,667 17,026

Aggregate employee benefit costs of those people amounted to: Group 2010 2009 £m £m Wages and salaries 617.2 648.4 Profit share and performance-related bonus 25.8 24.1 Social security costs 50.5 54.2Retirement benefit costs (see note 29) 34.1 37.1 Other post-employment benefit costs (see note 29) (0.1) 4.0 Share-based payments (see note 32) 8.4 8.9 735.9 776.7

Wages and salaries for 2010 includes £7.2m of redundancy costs (2009: £7.7m) relating to continuing operations.

During the year the Group embarked upon an HR modernisation project which moved human resources staff from individual businesses to the centre, resulting in an increased number of staff within Corporate.

Details of remuneration (including retirement benefits) and interests for directors are included in the Remuneration Report, which forms part of these Financial Statements. Details of remuneration for key management are included in note 38.

The Company has no employees (2009: nil).

7. Net finance cost Group 2010 2009 £m £m Hire purchase and finance leases 0.8 1.0Unwinding of discount 1.1 1.0Net finance cost on post-employment benefits 16.2 6.6Other finance costs 0.3 1.2Finance cost 18.4 9.8Interest receivable on short-term deposits (0.7) (2.9)Income from held at fair value financial assets (0.9) (2.2)Unwinding of discount (0.4) (0.4)Other finance income (1.8) (1.2)Finance income (3.8) (6.7)Net finance cost 14.6 3.1

Company finance income consisted of net interest income of £0.3m (2009: £0.1m) and unwinding of discount on loan notes receivable of £0.4m (2009: £0.4m).

Unwinding of discount disclosed within finance cost comprises £0.8m (2009: £0.7m) relating to provisions and £0.3m (2009: £0.3m) relating to borrowings.



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8. Income tax expense a) Analysis of charge in the year Group 2010 2009 £m £m Current income tax– current year 20.0 16.8– adjustment in respect of prior year (0.2) 0.5Deferred income tax (see note 19) (0.5) 1.2Income tax on profit per income statement 19.3 18.5Adjust for:– Joint Venture taxation (0.2) –Normalised income tax expense 19.1 18.5

Profit before tax per income statement 96.6 102.7Adjust for:– Joint Venture taxation (0.2) –– profit on disposal of Joint Ventures (0.1) (2.5)Normalised profit before income tax 96.3 100.2

Effective income tax rate 20.0% 18.0%Normalised effective income tax rate 19.8% 18.5%

b) Factors affecting income tax expenseThe income tax expense for the year is lower (2009: lower) than the standard rate of corporation tax in the UK of 28% (2009: 28%). The differences are explained below: Group 2010 2009 % %UK statutory income tax rate 28.0 28.0

Increase/(decrease) resulting from:Expenses not deductible for tax purposes – 0.7Adjustment in respect of overseas tax rates (6.4) (4.1)Effect of share-based payments (0.2) 2.6Tax on Joint Ventures 0.6 (0.1)R&D tax credit (2.4) (2.4)Consortium relief – (6.8)Other 0.4 0.8Disposal of Joint Ventures – (0.7)Effective income tax rate 20.0 18.0

The normalised income tax expense for the year is lower (2009: lower) than the standard rate of corporation tax in the UK of 28% (2009: 28%). The differences are explained below: Group 2010 2009 % %UK statutory income tax rate 28.0 28.0

Increase/(decrease) resulting from:Expenses not deductible for tax purposes – 0.7Adjustment in respect of overseas tax rates (6.4) (4.2)Effect of share-based payments (0.2) 2.7Tax on Joint Ventures 0.4 (0.1)R&D tax credit (2.4) (2.4)Consortium relief – (6.9)Other 0.4 0.7Normalised effective income tax rate 19.8 18.5




c) Income tax on components of other comprehensive income Group Post- employment benefit Cash flow liability hedges Total2010 £m £m £mAt 1 April 35.4 – 35.4Deferred income tax 46.6 – 46.6Current income tax – (1.0) (1.0)At 31 March 82.0 (1.0) 81.0

Group Post- employment benefit Cash flow liability hedges Total2009 £m £m £mAt 1 April 1.1 – 1.1Deferred income tax 34.3 – 34.3 Current income tax – – – At 31 March 35.4 – 35.4

9. Profit on disposal of Joint VentureOn 5 March 2010 the Group disposed of its holding in Transaction Systems Limited generating a profit on disposal of £0.1m. In the prior year, the Group disposed of its holding in Modern Housing Solutions (Prime) Limited generating a profit on disposal of £2.5m.

10. Discontinued operations Following the expiry during the year of a letter of credit issued in respect of the Metronet Enterprise (which went into PPP administration on 18 July 2007) the Group has released a related provision and a one-off, non-cash credit of £25.0m has been reflected in the Group’s full-year income statement. There is no related tax charge.

11. Dividends Company and Group 2010 2009 2010 2009 pence pence £m £mFinal dividend paid for the year ended 31 March 2009 (2008) 17.25 16.50 16.7 16.1 Interim dividend paid for the year ended 31 March 2010 (2009) 9.25 8.75 9.0 8.6 Dividends recognised in the year 26.50 25.25 25.7 24.7

Interim dividend paid for the year ended 31 March 2010 (2009) 9.25 8.75 9.0 8.6 Final dividend proposed for the year ended 31 March 2010 (2009) 18.25 17.25 17.8 16.9 Dividends relating to the year 27.50 26.00 26.8 25.5

The proposed final dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these Financial Statements.

As at 31 March 2010 one Employee Benefit Trust had an agreement in place to waive dividends in excess of 0.01 pence per share on 213,461 ordinary shares (2009: 213,461). A separate Employee Benefit Trust also had an agreement in place as at 31 March 2009 to waive dividends in excess of 0.01 pence per share on 2,126,051 ordinary shares. On 29 April 2009 this second Employee Benefit Trust entered a new agreement to waive all future dividends in their entirety and as at 31 March 2010 this waiver was in place on 2,633,450 ordinary shares. These arrangements reduced the dividends paid in-year by £0.8m (2009: £0.6m).



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12. Earnings per share (EPS)Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of shares in issue during the year, excluding shares held by the Employee Benefit Trusts (EBTs), which have not unconditionally vested in the employees, and shares in treasury.

Diluted earnings per share is the basic earnings per share after allowing for the dilutive effect of the conversion into ordinary shares of the number of options outstanding during the year. The options relate to discretionary employee share plans.

Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below: Group 2010 2009 number number (000) (000)Number of sharesWeighted average number of shares used in basic and normalised basic EPS 97,269 97,790Effect of dilutive securities – share options 1,964 1,516Weighted average number of shares used in diluted and normalised diluted EPS 99,233 99,306

£m £mEarnings – continuing and discontinued operationsProfit for the year attributable to owners of the parent 102.3 84.2

Earnings – continuing operationsProfit for the year attributable to owners of the parent 77.3 84.2Profit on disposal of Joint Venture (note 9) (0.1) (2.5)Normalised earnings 77.2 81.7

pence penceFrom continuing and discontinued operationsBasic earnings per share 105.2 86.1Diluted earnings per share 103.1 84.8

From continuing operationsBasic earnings per share 79.5 86.1Diluted earnings per share 77.9 84.8

Normalised basic earnings per share 79.4 83.5 Normalised diluted earnings per share 77.8 82.3

Normalised diluted EPS is considered by the directors to be a more representative measure of underlying trading.

13. Parent Company Income StatementThe Company has not presented its own income statement as permitted by Section 408 of the Companies Act 2006. The profit for the year attributable to the owners of the parent was £46.8m (2009: £9.6m), which included £12.0m (2009: £nil) dividend income from subsidiary companies.




14. Goodwill Group 2010 2009 £m £mCost at 1 April 71.5 63.4 Additions (note 15) 0.1 2.9Difference on exchange (0.6) 5.2 Cost at 31 March 71.0 71.5

Aggregate impairment at 1 April 9.2 6.7Difference on exchange (0.3) 2.5Aggregate impairment at 31 March 8.9 9.2

Net book value at 31 March 62.1 62.3

Goodwill is tested for impairment in accordance with IAS 36, Impairment of assets at least annually.

Goodwill is allocated to the Group’s cash-generating units (CGUs) identified according to their business segment.

The goodwill allocation by CGU, summarised at segmental level, is disclosed below: Group 2010 2009 £m £mDesign and Engineering Solutions 34.5 34.5Highways and Transportation 2.4 2.4Rail 1.4 1.4Middle East – –China and Europe 5.2 5.2Management and Project Services 18.6 18.8Asset Management – –Total 62.1 62.3

The recoverable amount of goodwill for each CGU has been based on value in use as represented by the net present value of future cash flows. Cash flows are projected forward for five years based on approved budgets and plans, beyond which they are inflated by a GDP-based growth factor. They are then discounted using a discount rate based on the Group’s pre-tax discount rate based on nominal weighted average cost of capital. The average pre-tax discount rate used was 13.4% per annum (2009: 13.8% per annum) which has been applied consistently across each CGU based on their similar risk profiles.

The key assumptions used for each CGU are as follows: Group 2010 2009Five-year growth rate 0% – 6% 0% – 18%Post five-year growth rate 0% – 2.5% 4%Taxation rate 22% 25%

As at 31 March 2010, based on these internal valuations, the recoverable value of goodwill required no impairment.



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15. Business combinationsOn 24 November 2009 the Group acquired the assets of Systems for Change Limited, a UK registered entity, for £125,000, consisting of cash consideration of £50,000 and deferred consideration of £75,000.

16. Other intangible assets Group Acquired Corporate Intellectual customer information property Software relationships systems rights licences Total £m £m £m £m £mCost at 1 April 2008 1.9 15.3 0.2 15.1 32.5 Additions – 0.2 – 10.3 10.5 Disposals – – – (4.1) (4.1)Difference on exchange – – – 1.2 1.2 Cost at 31 March 2009 1.9 15.5 0.2 22.5 40.1

Additions – 0.1 – 3.4 3.5 Disposals – – – (14.2) (14.2)Cost at 31 March 2010 1.9 15.6 0.2 11.7 29.4

Amortisation at 1 April 2008 1.3 15.3 – 5.0 21.6 Amortisation charge for the year 0.5 0.1 – 12.1 12.7 Disposals – – – (4.1) (4.1) Difference on exchange – – – 0.9 0.9 Amortisation at 31 March 2009 1.8 15.4 – 13.9 31.1

Amortisation charge for the year 0.1 – 0.1 7.3 7.5Disposals – – – (14.0) (14.0)Difference on exchange – – – 0.1 0.1 Amortisation at 31 March 2010 1.9 15.4 0.1 7.3 24.7

Net book value at 31 March 2010 – 0.2 0.1 4.4 4.7Net book value at 31 March 2009 0.1 0.1 0.2 8.6 9.0

Included within corporate information systems is £0.2m (2009: £0.1m) of internally generated intangible assets.




17. Property, plant and equipment Group Freehold Short-term Plant, land & leasehold machinery buildings property & vehicles Total £m £m £m £mCost at 1 April 2008 10.1 16.5 91.2 117.8 Additions – 5.1 17.3 22.4Acquisition of subsidiary undertakings – – 0.1 0.1Disposals – (0.8) (9.5) (10.3)Difference on exchange – 0.8 5.1 5.9Cost at 31 March 2009 10.1 21.6 104.2 135.9

Additions – 1.3 9.1 10.4Disposals – (0.9) (15.5) (16.4)Difference on exchange – – (0.3) (0.3)Cost at 31 March 2010 10.1 22.0 97.5 129.6

Depreciation at 1 April 2008 7.3 7.5 57.4 72.2 Depreciation charge for the year 0.1 3.7 16.9 20.7Disposals – (0.5) (8.0) (8.5)Difference on exchange (0.1) 0.9 4.1 4.9Depreciation at 31 March 2009 7.3 11.6 70.4 89.3

Depreciation charge for the year 0.1 2.7 12.5 15.3Disposals – (0.9) (12.9) (13.8)Difference on exchange – – (0.1) (0.1)Depreciation at 31 March 2010 7.4 13.4 69.9 90.7

Net book value at 31 March 2010 2.7 8.6 27.6 38.9Net book value at 31 March 2009 2.8 10.0 33.8 46.6

The market value of freehold land and buildings is estimated at £9.0m (2009: £9.0m).

Included in plant, machinery and vehicles above are equipment and vehicles held under finance leases and hire purchase contracts as follows:

2010 2009 £m £mCost 20.5 24.3Accumulated depreciation (10.1) (11.1)Net book value 10.4 13.2

Additions to property, plant and equipment funded by finance leases were £1.9m (2008: £4.2m).

Included in the above are equipment and vehicles leased to customers under operating leases as follows: 2010 2009 £m £mCost 3.6 3.7Accumulated depreciation (2.6) (2.4)Net book value 1.0 1.3



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18. Investments in subsidiaries Company £mCost at 1 April 2008 131.6Additions 18.1Cost at 31 March 2009 149.7

Additions 14.4Cost at 31 March 2010 164.1

Impairment at 1 April 2008, 31 March 2009 and 31 March 2010 0.8

Net book value at 31 March 2010 163.3Net book value at 31 March 2009 148.9

The Group’s principal subsidiaries are disclosed in note 39.

During the year the Company increased its investment in Atkins Investments UK Limited in order to enable Atkins Investments UK Limited to fulfil its obligation to make shareholder contributions to Connect Plus (M25) Intermediate Limited.

During the prior year the Company increased its investment in Atkins Investments UK Limited in order to facilitate the purchase of WS Atkins Insurance (Guernsey) Limited by Atkins Investments UK Limited from another Group company.

19. Deferred income taxDeferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority. The offset amounts are as follows: Group 2010 2009 £m £mDeferred tax assets:– Deferred tax assets to be recovered after more than 12 months 147.1 98.9– Deferred tax assets to be recovered within 12 months 3.9 2.8 151.0 101.7Deferred tax liabilities:– Deferred tax liabilities to be recovered after more than 12 months (1.6) –– Deferred tax liabilities to be recovered within 12 months – (0.1) (1.6) (0.1)Deferred tax assets (net) 149.4 101.6

a) Net deferred tax assets Group 2010 2009 £m £mAccelerated depreciation 18.0 13.8Share-based payments 2.9 2.5Overseas 2.4 0.4Deferred tax asset on post-employment benefit liabilities 122.9 83.0Deferred income 0.9 0.9 Amortisation of intangibles on acquisitions – (0.1)Other temporary differences 2.3 1.1Total deferred income tax 149.4 101.6




b) Analysis of movements during the year Group 2010 2009 £m £mDeferred tax assets at 1 April 101.6 69.6Transfers between current and deferred tax 0.5 –Deferred tax credited/(charged) to the income statement – continuing operations (note 8a) 0.5 (1.2)Deferred tax credited to equity (note 8c) 46.6 33.2Foreign exchange difference on deferred tax 0.2 –Deferred tax assets at 31 March 149.4 101.6

20. Derivative financial instrumentsThe fair value of forward currency contracts at the year end, based on their market value, is detailed below: Group 2010 2009 Inflow Outflow Net Inflow Outflow Net £m £m £m £m £m £mCurrent 32.5 (31.2) 1.3 8.9 (9.7) (0.8)

Between one and two years 16.7 (16.5) 0.2 5.5 (5.7) (0.2)Between two and five years 22.2 (21.8) 0.4 0.9 (1.1) (0.2)Non-current 38.9 (38.3) 0.6 6.4 (6.8) (0.4)

Total 71.4 (69.5) 1.9 15.3 (16.5) (1.2)

The Group did not use any derivative instrument during the year other than forward currency contracts and foreign exchange swaps to hedge foreign currency receipts and payments on current contracts.

All of the Group’s derivative financial instruments are classified as Level 2 under the amendments to IFRS 7, Financial instruments: disclosures. The fair value of derivative financial instruments is calculated based on quoted forward currency rates at the balance sheet date.

The Group has reviewed all contracts for embedded derivatives and does not have any such instruments that are closely related to the host contract.

21. Other receivables Group Company 2010 2009 2010 2009 £m £m £m £mNon-current assets:Loan notes receivable 21.2 12.9 6.4 6.0

During the year the Group acquired £7.9m of interest-bearing loan notes in Connect Plus (M25) Intermediate Limited which mature in 2039. In the prior year the Group acquired interest-bearing loan notes in RMPA Holdings Limited which also mature in 2039.

Loan notes receivable of £6.4m arose on the disposal of LSH. These loan notes have no fixed redemption date.

None of the other receivables are past due.



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22. Inventories Group 2010 2009 £m £m Raw materials and consumables 0.9 0.3

The directors consider that the carrying amount of inventories approximates their fair value.

There were no amounts of inventories written off during the year (2009: £nil).

23. Trade and other receivables Group Company 2010 2009 2010 2009 £m £m £m £mCurrent assets:Trade receivables 272.3 301.9 – – Less: Provision for impairment of receivables (42.4) (26.5) – –Trade receivables – net 229.9 275.4 – –Amounts recoverable on contracts 32.6 33.3 – – Amounts due from subsidiary undertakings (note 38) – – 11.3 11.4 Amounts due from Joint Ventures (note 38) 3.2 7.8 – –Other receivables 22.8 23.0 – –Prepayments and accrued income 12.2 14.2 – – 300.7 353.7 11.3 11.4

The directors consider that the carrying amount of trade and other receivables approximates their fair value.

At 31 March 2010 £138.4m (2009: £176.2m) of trade receivables were within normal payment terms and considered to be fully performing. A further £72.6m (2009: £92.2m) were past due date and aged up to six months from invoice date, which carried a provision for impairment of £5.8m (2009: £nil). Trade receivables aged beyond six months of invoice date totalled £61.3m (2009: £33.4m) and carried a provision for impairment of £36.6m (2008: £26.5m).

Movements in the Group provision for impairment of trade receivables were as follows: Group 2010 2009 £m £m Provision for impairment at beginning of year (26.5) (13.0)Increase in provisions (27.5) (15.4)Release of provisions 8.0 3.1Receivables written off as uncollectable 3.8 2.2Difference on exchange (0.2) (3.4)Provision for impairment at end of year (42.4) (26.5)

None of the financial assets that are fully performing were renegotiated during the year.

Amounts due from Joint Ventures are shown net of contract-related provisions of £nil (2009: £23.1m). The other classes of financial assets shown within trade and other receivables were unimpaired both at 31 March 2010 and 31 March 2009.




24. Financial assets at fair value through profit or lossThe Group’s financial instruments that are measured and recognised at fair value include certificates of deposit, floating rate notes and fixed interest securities.

The following table presents the Group’s financial assets and liabilities measured at fair value through profit and loss:

Group 2010 2009 Level 1 Level 2 Total Level 1 Level 2 Total £m £m £m £m £m £m Certificates of deposit – 19.3 19.3 – 17.3 17.3Floating rate notes 2.0 – 2.0 1.7 – 1.7Fixed interest securities 11.1 – 11.1 9.7 – 9.7Marketable securities 13.1 19.3 32.4 11.4 17.3 28.7

Level 1 financial instrumentsThe fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arms length basis. The quoted market price used by the Group is the mid-market price.

Level 2 financial instrumentsThe fair values of financial instruments that are not traded in an active market are determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on estimates. The fair value of certificates of deposit is calculated as the present value of the future cash flows, discounted at an appropriate market rate of interest.

25. Cash and cash equivalents Group Company 2010 2009 2010 2009 £m £m £m £mCash at bank and in hand 98.1 78.1 – –Short-term bank deposits 162.2 131.6 – – 260.3 209.7 – –

Included in the Group’s cash and cash equivalents above are amounts held by the Employee Benefit Trusts of £0.8m (2009: £2.9m).

Within the Middle East £1.3m (AED 7.2m) (2009: £0.6m (AED 3.2m)) is held within an escrow account in order to cover the Group’s liability in respect of visa bonds issued locally.

The effective interest rate on cash and cash equivalents was 0.3% (2009: 2.0%).



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26. Borrowings Group 2010 2009 £m £m CurrentHire purchase and finance leases 3.7 4.8Loan notes 0.7 2.8 4.4 7.6

Non-currentHire purchase and finance leases 7.0 8.9Loan notes – 0.6 7.0 9.5

Loan notes relate to previous years’ Group acquisitions.

The maturity profile of the carrying amount of the non-current borrowings was as follows: Group 2010 2009 Hire purchase Hire purchase and and finance Loan finance Loan leases notes Total leases notes Total £m £m £m £m £m £m Repayable: – between one and two years 2.1 – 2.1 3.3 0.6 3.9 – between two and five years 4.0 – 4.0 4.2 – 4.2 – after more than five years 0.9 – 0.9 1.4 – 1.4 7.0 – 7.0 8.9 0.6 9.5

The carrying amounts of the borrowings are denominated in the following currencies: Group 2010 2009 Hire purchase Hire purchase and and finance Loan finance Loan leases notes Total leases notes Total £m £m £m £m £m £m Sterling 10.7 0.7 11.4 13.7 3.4 17.1 Total 10.7 0.7 11.4 13.7 3.4 17.1

The minimum lease payments under finance leases fall due as follows: Group 2010 2009 £m £m Not later than one year 4.2 5.4Later than one year but not more than five years 6.4 7.8More than five years 0.8 1.2 11.4 14.4Future finance charges on finance leases (0.7) (0.7)Present value of finance lease payables 10.7 13.7

Finance leases are on a fixed repayment basis, with interest rates fixed at the contract date. The average effective borrowing rate was 6.4% (2009: 6.2%) over a weighted average remaining period of 52 months (2009: 44 months).




Borrowing facilitiesThe Group has the following undrawn committed borrowing facilities available at 31 March expiring as follows: Group 2010 2009 £m £m Between one and two years 87.0 –Between two and five years – 75.0

All of the Group’s undrawn committed borrowing facilities will be subject to floating rates of interest.

The Group’s principal borrowing facilities of £100.0m signed on 21 June 2006 are unsecured and include borrowings and letter of credit facilities. The total letters of credit in issue at 31 March 2010 was £13.0m (31 March 2009: £25.0m).

The Group’s banking facilities include a number of financial and non-financial covenants. Compliance with these covenants is monitored. As at 31 March 2010, and since, none of these covenants had been breached.

27. Trade and other payables Group Company 2010 2009 2010 2009 £m £m £m £mCurrent liabilities:Trade payables 50.6 64.4 – –Fees invoiced in advance 169.8 178.7 – – Amounts due to subsidiary undertakings (note 38) – – 42.2 57.4 Social security and other taxation 34.0 33.7 – – Deferred consideration on acquisitions 0.8 0.8 – – Deferred PFI/PPP bid costs recovered and development fees 0.2 0.1 – – Accruals and deferred income 155.2 179.8 2.0 –Other payables 23.7 21.2 0.1 0.1 434.3 478.7 44.3 57.5

The balance for deferred consideration represents £0.8m outstanding in respect of Nedtech Engineering BV and Systems for Change Limited to be settled in the next 12 months.

The directors consider that the carrying value of the Group’s trade and other payables approximates their fair value.

28. Provisions for other liabilities and charges Group 2010 2009 Onerous Vacant Onerous Vacant contracts property Total contracts property Total £m £m £m £m £m £mCurrent 0.7 4.9 5.6 9.7 0.2 9.9

Between one and two years 0.3 5.6 5.9 0.4 1.1 1.5Between two and five years 0.6 3.9 4.5 0.7 3.7 4.4Over five years 4.7 1.9 6.6 5.0 6.9 11.9Non-current 5.6 11.4 17.0 6.1 11.7 17.8 Total 6.3 16.3 22.6 15.8 11.9 27.7



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Group Onerous Vacant contracts property Total £m £m £mBalance at 1 April 2009 15.8 11.9 27.7Charge to income statement – 9.1 9.1Provisions utilised (6.4) (4.9) (11.3)Provisions released (3.7) – (3.7)Unwinding of discount 0.6 0.2 0.8Balance at 31 March 2010 6.3 16.3 22.6

The onerous contracts and vacant property provisions are discounted. No provision has been released or utilised for any purpose other than that for which it was established.

The onerous contracts provision relates to PFI school and hospital facilities management contracts in the Asset Management segment. The PFI provisions held are expected to be utilised over the next 20 years.

The vacant property provision is expected to be utilised over the next 8 years (2009: 11 years).

29. Post-employment benefit liabilitiesThe Group’s post-employment benefit liabilities are analysed below: Group 2010 2009 £m £m Retirement benefit liabilities 440.0 298.4Other post-employment benefit liabilities 10.5 13.1 450.5 311.5

a) Retirement benefit liabilitiesThe Group operates both defined benefit and defined contribution pension schemes. The two main defined benefit schemes are the Atkins Pension Plan and the Railways Pension Scheme, both of which are funded final salary schemes. The assets of both schemes are held in separate trustee-administered funds. Other pension schemes include the Atkins McCarthy Pension Plan in the Republic of Ireland, which is a final salary funded defined benefit scheme, and a range of defined contribution schemes or equivalent.

On 1 September 2009 the terms of the Railways Pension Scheme were amended to offer two options regarding future benefits. The options were to receive future benefits linked to final salary in exchange for higher contributions or to receive future benefits linked to salary as at 1 September 2009 with future increases capped at inflation. Following consultation 83 members selected to cap their future benefits which has resulted in a curtailment gain of £2.6m in the year. The remaining members retained benefits linked to final salary.

During the year as a result of a TUPE transfer 49 members transferred out of the Atkins section of the Railways Pension Scheme. The bulk of the assets were transferred in January 2010 and the liabilities in respect of transferring members were valued at 31 December 2009. The bulk transfer resulted in a settlement gain of £4.1m. The Company also made a top-up payment to the receiving section to ensure full funding for protected members which amounted to £1.8m. The payment was made directly to the receiving section and so does not appear in the disclosures for the Atkins section of the Railways Pension Scheme. The net gain recognised in the income statement is £2.3m.

In the previous year, on 31 March 2009 the defined benefit section of the Atkins McCarthy pension scheme was closed to future accrual of benefits for members who do not enjoy a statutory or contractual right to a final salary pension. These members transferred to the Personal Retirement Savings Accounts – Ireland (PRSA – Irish Life) scheme with effect from 1 April 2009.

The Atkins Pension Plan was closed to future accrual of benefits on 30 September 2007 and all members were transferred to a defined contribution section for future service where it was clear they did not enjoy a statutory or contractual right to a final salary pension. Although the service accrual under the defined benefit sections ceased for these members, the link to final salary remains whilst employed by Atkins Limited (unless opting out or retiring if sooner).




The defined benefit sections of all pension schemes are closed to new entrants, who are offered membership of the defined contribution section.

Membership of the Group’s principal pension schemes is as follows:

Defined benefit schemes Defined contribution schemes Atkins Pension Railways Pension Atkins Pension Plan Scheme Plan F+G 2010 2009 2010 2009 2010 2009 2010 2009 No. No. No. No. No. No. No. No.Members 71 100 304 397 7,809 8,700 748 848 Restricted members 1,589 1,810 – – – – – –Deferred pensioners 6,563 6,549 325 322 5,914 4,784 1,212 973Pensioners 2,771 2,585 268 227 – – – – 10,994 11,044 897 946 13,723 13,484 1,960 1,821

Restricted members consists of staff who are no longer accruing final salary benefits but retain their entitlement to pensions linked to final salary based on years of service accumulated prior to the closure of the scheme to future accrual. These staff are also included where appropriate within defined contribution schemes.

The main assumptions used for the IAS 19 valuation of the retirement benefit liabilities for the Atkins Pension Plan and the Railways Pension Scheme are listed in the table below: 2010 2009Price inflation 3.70% 3.00%Rate of increase of pensions in payment Limited Price Indexation 3.70% 3.00% Limited Price Indexation to 2.5% 2.50% 2.50% Fixed 5.00% 5.00%Rate of increase in salaries Atkins Pension Plan 5.20% 4.50% Railways Pension Scheme (Uncapped) 5.95% 4.50% Railways Pension Scheme (Capped) 3.70% n/aRate of increase for deferred pensioners 3.70% 3.00% Discount rate 5.50% 6.30%Expected rate of return on plan assets 6.50% 6.60%Expected rate of social security increases 3.70% 3.00%Longevity at age 65 for current pensioners Men 22.4 years 22.3 years Women 24.8 years 24.7 yearsLongevity at age 65 for future pensioners (current age 45) Men 24.3 years 24.2 years Women 26.7 years 26.6 years

The actuarial tables used to calculate the retirement benefit liabilities for the Atkins Pension Plan were the 2000 series standard tables, with medium cohort improvements and a minimum of 1% improvement per annum, based on year of use application. The Railways Pension Scheme results have been adjusted on an approximate basis to be based on the same mortality tables.



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The components of the pension cost are as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mCost of salesCurrent service cost 2.9 2.6 – 5.5 Curtailment gain – (2.6) – (2.6)Settlement gain (net) – (2.3) – (2.3)Total charge/(credit) 2.9 (2.3) – 0.6Finance cost/(income) Interest cost 50.6 11.4 0.3 62.3 Expected return on plan assets (37.7) (9.3) (0.2) (47.2)Net finance cost 12.9 2.1 0.1 15.1 Total charge/(credit) to income statement for defined benefit schemes 15.8 (0.2) 0.1 15.7Charge for defined contribution schemes – – 33.5 33.5Total charge/(credit) to income statement 15.8 (0.2) 33.6 49.2Statement of comprehensive incomeGain on pension scheme assets 93.8 30.3 1.1 125.2Changes in assumptions (234.5) (56.1) (0.9) (291.5)Actuarial (loss)/gain (140.7) (25.8) 0.2 (166.3)Deferred tax credited to equity 39.4 7.2 – 46.6 Actuarial (loss)/gain (net of deferred tax) (101.3) (18.6) 0.2 (119.7)

Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mCost of sales Current service cost 4.6 3.7 0.6 8.9Total service cost 4.6 3.7 0.6 8.9 Finance cost/(income) Interest cost 52.8 12.5 0.3 65.6Expected return on plan assets (45.9) (13.5) (0.3) (59.7)Net finance cost/(income) 6.9 (1.0) – 5.9 Total charge to income statement for defined benefit schemes 11.5 2.7 0.6 14.8 Charge for defined contribution schemes – – 28.2 28.2 Total charge to income statement 11.5 2.7 28.8 43.0 Statement of comprehensive income Loss on pension scheme assets (136.2) (56.4) (1.6) (194.2)Changes in assumptions 47.7 22.2 1.5 71.4 Actuarial loss (88.5) (34.2) (0.1) (122.8)Deferred tax credited to equity 24.7 9.6 – 34.3 Actuarial loss (net of deferred tax) (63.8) (24.6) (0.1) (88.5)




The expected return on plan assets is based on market expectations at the beginning of the year for returns over the entire life of the benefit obligation. Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mDefined benefit obligation (1,080.2) (234.6) (7.9) (1,322.7)Fair value of plan assets 725.9 150.7 6.1 882.7 Retirement benefit liabilities (354.3) (83.9) (1.8) (440.0)

Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mDefined benefit obligation (812.2) (184.2) (7.0) (1,003.4)Fair value of plan assets 579.6 121.2 4.2 705.0 Retirement benefit liabilities (232.6) (63.0) (2.8) (298.4)

Other includes the Atkins McCarthy defined benefit pension scheme and an unfunded pension obligation in relation to a former director, for £0.6m (2009: £0.5m).

The major categories of plan assets as a percentage of total plan assets are as follows: Expected Atkins Pension Railways Pension asset return Plan Scheme2010 % % £m % £mEquities 8.00 52.0 377.5 60.0 90.4 Bonds 5.00 41.0 297.6 30.0 45.2 Property 6.50 5.0 36.3 10.0 15.1 Other/cash 4.20 2.0 14.5 – – 100.0 725.9 100.0 150.7 Expected Atkins Pension Railways Pension asset return Plan Scheme2009 % % £m % £mEquities 7.90 47.0 272.4 80.0 97.0Bonds 6.40 45.0 260.8 10.0 12.1 Property 7.15 7.0 40.6 10.0 12.1 Other/cash 3.50 1.0 5.8 – – 100.0 579.6 100.0 121.2

The plan assets do not include any of the Group’s own financial instruments or property occupied by the Group.



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Movements in the present value of the defined benefit obligation are as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mDefined benefit obligation at beginning of year 812.2 184.2 7.0 1,003.4Service cost 2.9 2.6 – 5.5Curtailment gain – (2.6) – (2.6)Settlement gain – (11.0) – (11.0)Interest cost 50.6 11.4 0.3 62.3 Change of assumptions 234.5 56.1 0.9 291.5Employee contributions 0.1 1.8 – 1.9 Benefit payments (20.1) (7.9) (0.1) (28.1)Difference on exchange – – (0.2) (0.2)Defined benefit obligation at end of year 1,080.2 234.6 7.9 1,322.7

Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mDefined benefit obligation at beginning of year 820.1 194.7 7.1 1,021.9 Service cost 4.6 3.7 0.6 8.9 Interest cost 52.8 12.5 0.3 65.6 Change of assumptions (47.7) (22.2) (1.5) (71.4)Employee contributions 0.4 1.7 0.2 2.3 Benefit payments (18.0) (6.2) (0.7) (24.9)Difference on exchange – – 1.0 1.0Defined benefit obligation at end of year 812.2 184.2 7.0 1,003.4

Movements in the fair value of plan assets are as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mFair value of plan assets at beginning of year 579.6 121.2 4.2 705.0Expected return on plan assets 37.7 9.3 0.2 47.2 Settlement gain – (6.9) – (6.9)Employer contributions 34.8 2.9 0.8 38.5Employee contributions 0.1 1.8 – 1.9Benefits paid (20.1) (7.9) (0.1) (28.1) Actuarial gain 93.8 30.3 1.1 125.2Difference on exchange – – (0.1) (0.1)Fair value of plan assets at end of year 725.9 150.7 6.1 882.7

Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mFair value of plan assets at beginning of year 638.5 165.7 4.6 808.8 Expected return on plan assets 45.9 13.5 0.3 59.7Employer contributions 49.0 2.9 0.6 52.5Employee contributions 0.4 1.7 0.2 2.3Benefits paid (18.0) (6.2) (0.7) (24.9)Actuarial loss (136.2) (56.4) (1.6) (194.2)Difference on exchange – – 0.8 0.8 Fair value of plan assets at end of year 579.6 121.2 4.2 705.0




Movements in the retirement benefit liabilities are as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mRetirement benefit liabilities at beginning of year (232.6) (63.0) (2.8) (298.4)Service cost (2.9) (2.6) – (5.5)Net finance cost (12.9) (2.1) (0.1) (15.1)Curtailment gain – 2.6 – 2.6 Settlement gain – 4.1 – 4.1Contributions 34.8 2.9 0.8 38.5 Actuarial (loss)/gain (140.7) (25.8) 0.2 (166.3)Difference on exchange – – 0.1 0.1 Retirement benefit liabilities at end of year (354.3) (83.9) (1.8) (440.0)

Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mRetirement benefit liabilities at beginning of year (181.6) (29.0) (2.5) (213.1)Service cost (4.6) (3.7) (0.6) (8.9)Net finance (cost)/income (6.9) 1.0 – (5.9) Contributions 49.0 2.9 0.6 52.5 Actuarial loss (88.5) (34.2) (0.1) (122.8)Difference on exchange – – (0.2) (0.2)Retirement benefit liabilities at end of year (232.6) (63.0) (2.8) (298.4)

Cumulative net actuarial gains/(losses) recognised in equity are as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mAt beginning of year (108.0) (34.7) (2.8) (145.5) Net actuarial (loss)/gain recognised in the year (140.7) (25.8) 0.2 (166.3)At end of year (248.7) (60.5) (2.6) (311.8) Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mAt beginning of year (19.5) (0.5) (2.7) (22.7)Net actuarial loss recognised in the year (88.5) (34.2) (0.1) (122.8)At end of year (108.0) (34.7) (2.8) (145.5)



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The return on plan assets is as follows: Atkins Railways Pension Pension Plan Scheme Other Total2010 £m £m £m £mExpected return on plan assets 37.7 9.3 0.2 47.2Experience gain on plan assets 93.8 30.3 1.1 125.2Actual return on plan assets 131.5 39.6 1.3 172.4 Atkins Railways Pension Pension Plan Scheme Other Total2009 £m £m £m £mExpected return on plan assets 45.9 13.5 0.3 59.7Experience loss on plan assets (136.2) (56.4) (1.6) (194.2)Actual return on plan assets (90.3) (42.9) (1.3) (134.5)

History of experience gains and losses: 2010 2009 2008 2007 2006 Total Total Total Total Total Experience gain/(loss) on scheme assets £125.2m £(194.2)m £(88.1)m £3.4m £88.4mPercentage of scheme assets 14.2% (27.5)% (10.9)% 0.4% 12.2%

Experience (loss)/gain on scheme liabilities £(0.3)m £9.1m £20.7m £(0.5)m £15.8mPercentage of defined benefit obligation 0.0% (0.9)% (2.0)% 0.0% (1.5)%

Defined benefit obligation £(1,322.7)m £(1,003.4)m £(1,021.9)m £(1,058.2)m £(1,021.9)mFair value of plan assets £882.7m £705.0m £808.8m £808.1m £722.0mRetirement benefit liability £(440.0)m £(298.4)m £(213.1)m £(250.1)m £(299.9)m

The Group expects employer contributions to be paid during the financial year to 31 March 2011 to be circa £36.9m, of which £32.0m is in relation to the funding of the actuarial deficit, and employee contributions paid to be circa £2.1m. Expected benefit payments made directly by the Group to pensioners in the financial year to 31 March 2011 are £nil. The approximate effect on the liabilities from changes in the main assumptions used to value the liabilities are as follows:

Change in assumption Effect on plan liabilities Atkins Pension Plan Railways Pension SchemeDiscount rate increase/decrease 0.5% decrease/increase 10.0% decrease/increase 9.0% Inflation increase/decrease 0.5% increase/decrease 8.0% increase/decrease 9.0% Real rate of increase in salaries increase/decrease 0.5% increase/decrease 2.0% increase/decrease 3.0%Longevity increase 1 year increase 3.0% increase 2.0%

The effect of the change in inflation on liabilities assumes a corresponding increase in salary increases and inflation-related pension increases.




b) Other post-employment benefit liabilitiesThe Group operates unfunded gratuity schemes within certain of its non-UK businesses. Members of the schemes are entitled to receive a cash gratuity on leaving the business which is dependent on their length of employment and final salary. Valuation of the gratuity obligation is carried out in line with the principles of IAS 19, Employee benefits. Group 2010 2009 £m £m Other post-employment obligation at beginning of year 13.1 6.2Service cost (0.1) 4.0Interest cost 1.1 0.7Benefit payments (3.2) (1.0)Difference on exchange (0.4) 3.2Other post-employment obligation at end of year 10.5 13.1 The main assumptions used for the IAS 19 valuation of other post-employment benefits are listed in the table below:

2010 2009Discount rate 9% 9%Salary inflation 6% 7%Average remaining service period 2 years 2 years

30. Other non-current liabilities Group 2010 2009 £m £m Deferred PFI/PPP bid costs recovered, deferred consideration and development fees:Maturing between one and two years 0.8 0.9Maturing between two and five years 0.9 1.1Maturing after more than five years 4.1 2.8 5.8 4.8

31. Ordinary shares Group and Company 2010 2009 No. shares £m No. shares £mAuthorised ordinary shares of 0.5p eachAt 1 April 150,000,000 0.8 150,000,000 0.8Increase in year 30,000,000 0.1 – –At 31 March 180,000,000 0.9 150,000,000 0.8 Issued, allotted and fully paid ordinary shares of 0.5p eachAt 1 April 104,451,799 0.5 104,451,799 0.5 At 31 March 104,451,799 0.5 104,451,799 0.5

At the 2009 Annual General Meeting (AGM) held on Wednesday 9 September 2009 a shareholder resolution was passed by which the authorised share capital of the Company was increased by 30,000,000 ordinary shares of 0.5 pence each.

Also at the 2009 AGM, shareholder authority was obtained for the Company to purchase up to a maximum of 10,011,000 of its own ordinary shares (representing approximately 10% of the issued share capital of the Company on 16 June 2009) for a period ending on the earlier of the next AGM or 9 March 2011, provided that certain conditions (relating to the purchase price) are met. The Notice of Meeting for the AGM to be held at 1630 hours on Thursday 9 September 2010 proposes that shareholders approve a resolution updating and renewing this authority. Shares in the Company may also be purchased by Atkins’ Employee Benefit Trusts.

As at the date of this report there were 4,341,000 ordinary shares of 0.5p each (nominal value £21,705) held as treasury shares. No shares were purchased during the year ended 31 March 2010 (2009: 1,123,000 at a cost of £11.3m excluding fees and stamp duty). The 4,341,000 treasury shares, which represent approximately 4.2% of the total (2009: 4.2%) of the called-up share capital as at the date of this report, have not been cancelled and represent a deduction from shareholders’ equity.



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32. Share-based paymentsLong-Term Incentive PlansAtkins Long-Term Incentive Plan (LTIP) September 2006 onwardsA share plan for senior executives and key employees used to make awards to employees that are settled in equity or, in limited circumstances, in cash. There are different performance targets for different categories of management. Awards made to executive directors and senior employees have 50% of the award subject to the Company’s total shareholder return (TSR) performance relative to the constituents of the FTSE 250 Index (excluding investment trusts) on the date of the award. Full vesting of this portion of the award will take place if the Company is ranked in the upper quartile and 30% vesting will be achieved with a median ranking, with pro rata vesting for intermediate performance. No vesting will occur for a ranking below median.

The remaining 50% of the award made to executive directors and senior employees is subject to the Company’s real growth in normalised earnings per share (EPS) over the performance period. For the 2006 and subsequent awards the growth target required the increase to be more than 10% per annum above the UK Retail Price Index (RPI) in the three-year performance period to allow full vesting; if the increase is less than 4% per annum above the UK RPI then there will be no vesting. A sliding scale operates between 4% and 10% above the UK RPI.

Awards made to other participants are subject solely to the EPS condition. As a general rule awards made to participants who leave employment prior to vesting will be forfeited. In the event a participant leaves as a result of a qualifying reason they receive a pro rated entitlement.

Subject to vesting, participants are entitled to receive the benefit of dividends declared following award, without interest.

Atkins Long-Term Incentive Plan (LTIP) September 2003 to August 2006 A share plan for senior executives and key employees used to make awards to employees that are settled in equity or, in limited circumstances, in cash. The performance condition was TSR with an EPS growth underpin measured over three financial years starting with the financial year beginning immediately after the award was granted. Full vesting of any award took place for a TSR performance where the Company ranked in the top 20% in a group of up to 16 comparator companies, 30% vesting for median ranking and no award if TSR fell below the median. The EPS underpin was the UK RPI plus 2% per annum. As a general rule awards made to participants who left employment prior to vesting were forfeited. In the event that a participant left as a result of a qualifying reason they received a pro rated entitlement. All awards have now vested.

Atkins Long-Term Incentive Plan (LTIP) pre September 2003A share plan for senior executives and key employees used to make awards to employees that are settled in equity. Awards had an EPS performance condition. EPS was required to be more than 12% per annum above the UK RPI in the relevant three-year performance period to enable all of the ordinary shares to be acquired, but if the EPS growth was less than 5% per annum above the UK RPI then none of the ordinary shares could be acquired. A sliding scale in relation to the number of ordinary shares that could be acquired operated for growth in EPS between 5% and 12% above the UK RPI. Participants are entitled to receive the benefit of dividends declared, without interest, on the shares subject to the award between vesting and exercise. As a general rule awards made to participants who left employment prior to vesting were forfeited. In the event that a participant left as a result of a qualifying reason they received a pro rated entitlement. All awards have now vested.

WS Atkins Employees’ Stock Option Plan (ESOP)A share plan used to make awards to key employees in the US that are settled in equity or in cash and which permitted options to be granted at an exercise price no lower than the market price of a share at the time of grant. Options vested after three years and must be exercised within 10 years of the date of grant. All awards have now vested.

Atkins Restricted Stock Unit Plan (RSU)A share plan used to make awards to key employees following an acquisition that are settled in equity. There is no performance condition but awards are restricted for three years from the date of award. As a general rule awards made to participants who leave employment prior to vesting will be forfeited. In the event that a participant leaves as a result of a qualifying reason they will receive their award in full.




Deferred Bonus PlansAtkins Deferred Bonus Plan (DBP)A share plan for senior executives and key employees that is settled in equity or, in limited circumstances, in cash. There is no performance condition but awards are restricted for at least three years from the date of award. As a general rule awards made to participants who leave employment prior to vesting will be forfeited. In the event that a participant leaves as a result of a qualifying reason they will receive their award in full. In the case of awards to executive directors, the value of shares over which an award may be granted under the plan shall be taken to form part of the annual bonus payable to that participant. Awards may also be granted under the plan to employees below the level of executive directors that do not form part of their annual bonus (for instance, on recruitment of the employee).

Atkins Deferred Share Plan (DSP) (formerly the Atkins Retention Bonus Plan (RBP))A share plan for senior executives and key employees that are settled in equity or, in limited circumstances, in cash. There is no performance condition but awards are restricted for a set period, fixed by the Remuneration Committee at grant, from the date of the award. As a general rule awards made to participants who leave employment prior to vesting will be forfeited. In the event that a participant leaves as a result of a qualifying reason they will receive their award in full. In the case of awards to senior executives, the value of the shares over which an award may be granted under the plan are taken to form part of the annual bonus payable to that participant. Awards may be made to an executive director under the plan but only in connection with the deferral of an annual bonus entitlement. Awards may also be granted under the plan to employees that do not form part of their annual bonus.

The Group’s share-based payments charge for the year of £8.4m (2009: £8.9m) has been included in administrative expenses in the income statement.

The effect of the share-based payment transactions on the Group’s result and financial position is as follows: Group 2010 2009 £m £m Total expense recognised for equity-settled share-based payment transactions 6.8 8.7 Total expense recognised for cash-settled share-based payment transactions 1.6 0.2 8.4 8.9Closing balance of liability for cash-settled share-based payment transactions 2.1 1.0

As at 31 March 2010 the following awards were outstanding: LTIPs1 DBP/DSP2

Weighted Weighted average average exercise/ exercise/ transfer transfer Number price Number priceAwards outstanding at 1 April 2008 2,241,284 0.78p 1,000,276 – Granted 441,319 – 798,902 – Exercised/transferred (145,700) – (213,509) – Lapsed (359,336) – (467) – Forfeited (155,712) – (63,007) –Awards outstanding at 1 April 2009 2,021,855 0.16p 1,522,195 –Granted 277,000 – 1,280,478 –Exercised/transferred (378,211) – (414,874) –Lapsed (375,824) – (1,845) – Forfeited (125,082) – (71,669) –Awards outstanding at 31 March 2010 1,419,738 0.23p 2,314,285 –

1. Including LTIP, ESOP and RSU awards. 2. Including DBP and DSP (formally RBP) awards.

The weighted average share price at the date of exercise was 618.39p (2009: 934.86p).



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A summary of awards outstanding as at 31 March 2010 is as follows: Weighted average Awards Awards remaining outstanding exercisable Award Exercise Scheme Maximum contractual at 31 March at 31 MarchScheme date price maturity term life 2010 2010 LTIPs LTIP (September 2006 TSR/EPS onwards) 11/09/2006 to 19/06/2009 0.0p 3 years 3 to 10 years 7.81 years 558,574 10,347LTIP (September 2006 EPS onwards) 11/09/2006 to 27/06/2008 0.0p 3 years 3 to 10 years 6.53 years 784,563 85,300 LTIP (September 2003 to August 2006) 17/09/2003 to 25/06/2004 0.0p 3 to 4 years 10 years 3.88 years 32,625 32,625LTIP (pre September 2003) 30/11/2001 0.0p 3 years 10 years 1.67 years 2,297 2,297ESOP 08/06/2001 832.5p 3 years 10 years 1.19 years 400 400RSU 29/06/2007 0.0p 3 years 3 years 0.25 years 41,279 41,279DBPs DBP 26/08/2002 to 19/06/2009 0.0p 3 years 3 to 10 years 6.41 years 310,969 212,720DSP (formerly RBP) 29/06/2007 to 27/11/2009 0.0p 2 to 3 years 2 to 10 years 7.69 years 2,003,316 106,896

On 19 June 2009 the Company issued awards over 277,000 shares to employees under the LTIP, 36,904 shares to employees under the DBP and 1,228,436 shares to employees under the DSP (formerly RBP).

On 14 July 2009 the Company issued awards over 9,750 shares to employees under the DSP (formerly RBP).

On 27 November 2009 the Company issued awards over 5,388 shares to employees under the DSP (formerly RBP).

At 31 March 2010 the Company’s Employee Benefit Trusts held 2,846,911 shares (2009: 2,339,512 shares) at a nominal value of £0.0m (2009: £0.0m) and market value of £17.7m (2009: £11.6m).

For the purposes of valuing LTIP awards with market performance conditions, the Monte Carlo model has been used to arrive at the share-based payments charge. The assumptions used in the model are as follows: 2010 2009 LTIP LTIPExercise price £nil £nilRisk-free interest rate n/a n/aDiscount in respect of dividend yield 0% 0%Volatility of share price 39.8% 24.5% and 35.8%Share price at grant date: – 27/06/2008 1,048.0p 1,048.0p– 27/11/2008 611.0p 611.0p– 19/06/2009 546.0p –Expected term 3 years from 3 years from grant date grant date

Volatility was determined based on the movement in the share price over a period prior to the grant date equal in length to the period over which the TSR condition applies, which equates to a three-year share price history (2009: a three-year share price history). The fair value of share plans involving market performance conditions takes into account market information.

In accordance with the rules of the plan, the Monte Carlo model simulates TSR for the Company and a comparator group. In 2010 and 2009 the comparator group consisted of the FTSE 250 excluding investment trusts. The model takes into account historic dividends and share price volatilities for the Company and the comparator group to produce a predicted distribution of relative share performance.

Awards that do not contain market performance conditions are valued at market value at date of award and discounted in the event that the award does not benefit from dividends during the vesting period.

The weighted average fair value of awards granted during the year was 528.06p (2009: 993.70p).




33. Cash generated from continuing operations Group Company 2010 2009 2010 2009 £m £m £m £mProfit for the year 77.3 84.2 46.8 9.6Adjustments for:Income tax (note 8) 19.3 18.5 – –Finance income (note 7) (3.8) (6.7) (1.0) (0.8)Finance cost (note 7) 18.4 9.8 0.3 0.3 Share of post-tax loss/(profit) from Joint Ventures (note 4) 1.9 (0.2) – – Other non-cash costs 0.1 – – –Depreciation charges 15.3 20.7 – –Profit on disposal of Joint Venture (note 9) (0.1) (2.5) – –Amortisation charges 7.5 12.7 – –Release of deferred income (0.2) (0.1) – –Share-based payment charge (note 32) 6.8 8.9 – –Pensions settlement and curtailment gain (note 29) (6.7) – – –Result on disposal of property, plant and equipment 1.4 0.7 – –Dividends received – – (12.0) – Movement in provisions (note 28) (5.9) 9.2 – – Movement in inventories (note 22) (0.6) – – –Movement in trade and other receivables (note 23) 72.1 (34.1) 0.7 (3.0) Movement in payables (note 27) (41.9) 45.0 (1.5) 22.6 Movement in long-term payables 1.9 – – – Movement in post-employment benefits (note 29) (36.3) (40.6) – –Cash generated from continuing operations 126.5 125.5 33.3 28.7

34. Analysis of net funds At 31 March Cash Other non- Exchange At 31 March 2009 flow cash changes movement 2010 £m £m £m £m £mCash and cash equivalents 209.7 49.2 – 1.4 260.3 Loan notes receivable 12.9 7.9 0.4 – 21.2 Financial assets at fair value through profit or loss 28.7 3.7 – – 32.4 Borrowings due within one year (2.8) 2.7 (0.6) – (0.7)Borrowings due after one year (0.6) – 0.6 – –Finance leases (13.7) 4.9 (1.9) – (10.7)Net funds 234.2 68.4 (1.5) 1.4 302.5

35. Contingent liabilitiesThe Group has given indemnities in respect of overseas office overdrafts, performance bonds, advance payment bonds, letters of credit and import duty guarantees issued on its behalf. The amount outstanding at 31 March 2010 was £38.7m (2009: £61.5m) including £13.0m in respect of Connect Plus (M25) letters of credit. During the year letters of credit amounting to £25.0m in respect of the Metronet Enterprise expired. The indemnities, which arose in the ordinary course of business, are not expected to result in any material financial loss.



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36. Operating lease arrangements 2010 2009 Vehicles, Vehicles, plant and plant and Property equipment Property equipmentGroup £m £m £m £mFuture aggregate minimum lease payments under non-cancellable operating leases expiring: Within one year 9.5 4.3 13.3 7.8 Later than one year but less than five years 35.9 7.1 27.4 10.5 After five years 108.0 – 130.0 0.2 153.4 11.4 170.7 18.5

The Company had no operating lease commitments as at 31 March 2010 (2009: £nil). 2010 2009 Vehicles, Vehicles, plant and plant and Property equipment Property equipmentGroup £m £m £m £mAmounts receivable under non-cancellable operating leases expiring: Within one year 0.1 0.4 0.1 0.2 Later than one year but less than five years 1.7 – 0.3 2.4 After five years 0.2 – 1.3 0.5 2.0 0.4 1.7 3.1

The Company had no operating lease receivables as at 31 March 2010 (2009: £nil).

37. Capital and other financial commitments Group 2010 2009 £m £m Capital expenditure contracted for but not incurred – property, plant and equipment 0.3 2.2

The Group is committed to make payments for equity and debt into Special Purpose Companies under Public Private Partnership (PPP) and Private Finance Initiative (PFI) contracts of £12.1m (2009: £20.0m).

38. Related party transactionsDetails of the directors’ shareholdings, share options and remuneration are given in the Remuneration Report, which forms part of these Financial Statements.

Transactions with the retirement benefit schemes are shown in note 29.

Details of the Company’s principal subsidiaries are shown in note 39 and principal Joint Ventures in note 40.

a) Group sales and purchases of goods and services to/from Joint Ventures Group 2010 2009 £m £mSales of goods and services to Joint Ventures 20.6 26.4

Purchases of goods and services from Joint Ventures – –



b) Group year end balances arising from sales/purchases of goods and services to/from Joint Ventures and loans provided to Joint Ventures Group 2010 2009 £m £mReceivables from Joint Ventures 3.2 7.8

Receivables from Joint Ventures are shown net of contract-related provisions of £nil (2009: £23.1m).

Payables to Joint Ventures – –

c) Group year end balances arising from loans provided to other related parties Group 2010 2009 £m £mReceivables from related parties (note 21) 7.9 –

d) Company sales/purchases of goods and services to/from subsidiariesThe Company did not sell any goods or services to subsidiaries during the year (2009: £nil). The Company did not purchase any goods or services from its subsidiaries during the year (2009: £nil).

e) Company year end balances with subsidiaries Company 2010 2009 £m £mReceivables from subsidiaries 11.3 11.4

Payables to subsidiaries 42.2 57.4

Provision of goods and services to and purchases of goods and services from related parties were made at the rates charged to external customers. The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No provision has been made for doubtful debts in respect of amounts owed by related parties and £nil charged to income and expense (2009: £nil).

Receivables from subsidiaries are shown net of impairment of £75.4m (2009: £111.5m).

f) Key management compensationKey management comprises the executive and non-executive directors, and certain senior managers who are members of the Group Executive.

Group 2010 2009 £m £mSalaries and other short-term employment benefits 6.5 5.1Post-employment benefits 0.3 0.2 Share-based payments 1.6 1.3 8.4 6.6




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39. Subsidiary undertakingsThe following companies were the principal subsidiary undertakings as at 31 March 2010:

Country of Class and registration/ percentage incorporation of shares held Nature of businessAtkins China Limited China 100% ordinary Consulting engineersAtkins Facilities Management Limited England and Wales 100% ordinary Property servicesAtkins Investments Limited1 England and Wales 100% ordinary Investment company Atkins Limited1 England and Wales 100% ordinary Consulting engineersAtkins Investments UK Limited England and Wales 100% ordinary Holding companyFaithful & Gould Inc1 USA 100% ordinary Project and programme management consultantsFaithful+Gould Limited1 England and Wales 100% ordinary Quantity surveyors and cost estimatorsWS Atkins & Partners Overseas1 Gibraltar 100% ordinary Consulting engineers WS Atkins Insurance (Guernsey) Limited1 Guernsey 100% ordinary InsuranceWS Atkins International Limited1 England and Wales 100% ordinary Consulting engineers

1. Owned by a subsidiary undertaking other than WS Atkins plc.

The percentage of the issued share capital held by the Group is equivalent to the percentage of voting rights held. The Group holds the whole of all classes of issued share capital.

All the above operate in the country of registration, except for WS Atkins & Partners Overseas, which operates in the Middle East.

A full list of subsidiary companies will be filed at Companies House with the Company’s Annual Return.

40. Joint VenturesThe following represents the principal Joint Ventures in which the Group participated during the year:

Date of last audited Proportion of financial ExternalName Nature of business shares held2 statements auditorsRMPA Holdings Limited1 Holding company for companies involved in the design, financing and construction of the MoD garrison facility at Colchester. 14.0% 31 Mar 2009 KPMG Audit PLCConnect Plus Services (unincorporated) Joint Venture undertaking operation and maintenance on the M25 over the next 30 years.(32.5% interest). n/a n/a n/a

All Joint Ventures operate in the United Kingdom unless otherwise stated.

1. Owned by a subsidiary undertaking other than WS Atkins plc.2. Proportion of shares held is in respect of ordinary share capital. There are no special rights or constraints on the shares. There are no restrictions on distributions from

any of these Joint Ventures.



Consolidated Income Statements for years ended 31 March

2010 2009 2008 2007 2006 £m £m £m £m £mRevenue (Group and share of Joint Ventures) 1,418.0 1,532.4 1,399.5 1,240.3 1,411.0

Revenue 1,387.9 1,487.2 1,313.6 1,179.8 1,052.5

Cost of sales (854.6) (941.9) (834.1) (781.1) (637.3)Gross profit 533.3 545.3 479.5 398.7 415.2

Administrative expenses (420.3) (442.2) (392.8) (335.0) (352.3)Operating profit 113.0 103.1 86.7 63.7 62.9

Profit on disposal of Joint Ventures 0.1 2.5 – – 6.4 Share of post-tax (loss)/profit from Joint Ventures (1.9) 0.2 0.9 2.8 8.8Profit before interest and tax 111.2 105.8 87.6 66.5 78.1

Finance income 3.8 6.7 9.8 9.0 7.9Finance cost (18.4) (9.8) (5.5) (5.4) (11.2)Net finance (cost)/income (14.6) (3.1) 4.3 3.6 (3.3)Profit before taxation 96.6 102.7 91.9 70.1 74.8

Income tax expense (19.3) (18.5) (23.3) (15.2) (17.9)Profit for the year from continuing operations 77.3 84.2 68.6 54.9 56.9

Profit/(loss) for the year from discontinued operations 25.0 – 31.4 (112.2) –

Profit/(loss) for the year attributable to owners of the parent 102.3 84.2 100.0 (57.3) 56.9

Basic earnings/(loss) per share – continuing operations 79.5p 86.1p 67.9p 54.4p 57.0p– discontinued operations 25.7p – 31.0p (111.2)p – 105.2p 86.1p 98.9p (56.8)p 57.0p

Diluted earnings/(loss) per share– continuing operations 77.9p 84.8p 66.7p 53.8p 55.9p– discontinued operations 25.2p – 30.5p (110.6)p – 103.1p 84.8p 97.2p (56.8)p 55.9p

Five-year Summary



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Consolidated Balance Sheets as at 31 March

2010 2009 2008 2007 2006 £m £m £m £m £mAssetsNon-current assetsGoodwill 62.1 62.3 56.7 64.8 35.6Other intangible assets 4.7 9.0 10.9 9.4 10.0Property, plant and equipment 38.9 46.6 45.6 46.2 47.2Other receivables 21.2 12.9 5.7 0.1 21.6 Investments in Joint Ventures 1.8 3.9 4.2 (26.0) 46.2 Deferred income tax assets 149.4 101.6 69.6 89.8 103.8Derivative financial instruments 0.6 – – – – 278.7 236.3 192.7 184.3 264.4

Current assetsInventories 0.9 0.3 0.3 0.4 0.2Trade and other receivables 300.7 353.7 299.7 284.0 272.9Financial assets at fair value through profit or loss 32.4 28.7 29.7 49.6 20.7Cash and cash equivalents 260.3 209.7 154.5 187.7 177.4Derivative financial instruments 1.3 – – – – 595.6 592.4 484.2 521.7 471.2

LiabilitiesCurrent liabilitiesBorrowings (4.4) (7.6) (7.8) (3.7) (6.5)Trade and other payables (434.3) (478.7) (409.2) (418.6) (379.5)Derivative financial instruments – (0.8) (0.9) (0.1) –Current income tax liabilities (34.6) (31.2) (26.8) (28.3) (12.3)Provisions for other liabilities and charges (5.6) (9.9) (4.3) (8.7) (2.8) (478.9) (528.2) (449.0) (459.4) (401.1)Net current assets 116.7 64.2 35.2 62.3 70.1

Non-current liabilitiesBorrowings (7.0) (9.5) (13.6) (34.5) (35.1)Provisions for other liabilities and charges (17.0) (17.8) (13.5) (14.3) (11.7) Post-employment benefit liabilities (450.5) (311.5) (219.3) (250.1) (299.9)Derivative financial instruments – (0.4) – – –Other non-current liabilities (5.8) (4.8) (4.9) (23.8) (23.9) (480.3) (344.0) (251.3) (322.7) (370.6)

Net liabilities (84.9) (43.5) (23.4) (76.1) (36.1)

Capital and reservesOrdinary shares 0.5 0.5 0.5 0.5 0.5Share premium account 62.4 62.4 62.4 62.4 62.4 Merger reserve 8.9 8.9 8.9 8.9 8.9Retained loss (156.7) (115.3) (95.2) (147.9) (107.9)

Equity shareholders’ deficit (84.9) (43.5) (23.4) (76.1) (36.1)


124 Financial statements

Five-year Summary continued

Consolidated Cash Flow Statements for the years ended 31 March

2010 2009 2008 2007 2006 £m £m £m £m £mContinuing operationsProfit for the year 77.3 84.2 68.6 54.9 56.9 Adjustments for:Income tax 19.3 18.5 23.3 15.2 17.9Finance income (3.8) (6.7) (9.8) (9.0) (7.9)Finance cost 18.4 9.8 5.5 5.4 11.2 Share of post-tax loss/(profits) from Joint Ventures 1.9 (0.2) (0.9) (2.8) (8.8)Other non-cash costs 0.1 – – – – Profit on disposal of Joint Ventures (0.1) (2.5) – – (6.4)Depreciation charges 15.3 20.7 19.3 18.8 14.7 Amortisation charges 7.5 12.7 11.1 11.6 9.6 Release of deferred income (0.2) (0.1) (3.0) (0.2) (0.8)Share-based payment charge 6.8 8.9 8.6 5.1 3.0Pensions settlement and curtailment gain (6.7) – – – – Result on disposal of property, plant and equipment 1.4 0.7 0.1 (0.1) 0.7Movement in provisions (5.9) 9.2 (5.5) 8.5 (0.1)Working capital movements (4.8) (29.7) (36.4) (13.5) 21.7 Cash generated from continuing operations 126.5 125.5 80.9 93.9 111.7

Discontinued operations Cash generated from discontinued operations – – 0.3 10.8 –

Cash generated from operations 126.5 125.5 81.2 104.7 111.7 Interest received 3.4 6.3 9.7 8.9 7.6Interest paid (1.1) (2.2) (3.3) (2.1) (2.4) Income tax (paid)/received (18.0) (12.8) (14.7) 4.9 (10.9)Net cash from operating activities 110.8 116.8 72.9 116.4 106.0

Cash flows from investing activities (21.1) (32.8) (27.2) (78.0) (41.2)

Cash flows from financing activities (40.5) (45.8) (78.3) (25.9) (2.9)Net increase in cash, cash equivalents and bank overdrafts 49.2 38.2 (32.6) 12.5 61.9

Cash, cash equivalents and bank overdrafts at beginning of year 209.7 154.5 187.7 177.4 114.6

Effect of exchange rate changes 1.4 17.0 (0.6) (2.2) 0.9Cash, cash equivalents and bank overdrafts at end of year 260.3 209.7 154.5 187.7 177.4 Financial assets 32.4 28.7 29.7 49.6 40.8 Loan notes receivable 21.2 12.9 5.6 – – Borrowings due within one year (0.7) (2.8) (4.2) (0.4) (2.7)Borrowings due after one year – (0.6) (3.2) (23.1) (20.6)Finance leases (10.7) (13.7) (14.0) (14.7) (18.3)Net funds 302.5 234.2 168.4 199.1 176.6

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126 Investor Information

WS Atkins plcRegistered in England.Company no. 1885586

Company secretary and registered officeRichard WebsterWS Atkins plcWoodcote GroveAshley RoadEpsomSurrey KT18 5BW

Financial calendarEx-dividend date 18 August 2010Record date 20 August 2010Annual General Meeting 9 September 2010Final dividend payment date 24 September 2010

Shareholder servicesRegistrarEnquiries and notifications concerning dividends, share certificates, transfers and address changes should be sent to the Registrar, whose address is:

Capita RegistrarsNorthern HouseWoodsome ParkFenay BridgeHuddersfieldWest YorkshireHD8 0GA

Telephone: 0871 664 0300 (UK callers, calls cost 10p per minute including VAT plus any additional network charges, lines are open 0830 to 1730 Monday to Friday) or +44 (0)20 8639 3399 (non-UK callers).

Other shareholder enquiries should be addressed to Atkins’ company secretary at the registered office.

Investor relations websiteMany commonly asked shareholders’ questions are addressed in the investor relations section of our website www.atkinsglobal.com/investors

E-communicationsShareholders can choose to receive all Company communications electronically. To register please visit our share portal at www.myatkinsshares.com

Dividend reinvestment plan (DRIP)The Company offers a dividend reinvestment plan to shareholders as a cost-efficient way of increasing their shareholding in the Company. Should you wish to participate in the DRIP please contact the Registrar on the telephone number given above to request a mandate form and an explanatory booklet. Your completed mandate form must be received by the Registrar no later than 25 August 2010 if you wish your final dividend for the year to be reinvested to buy additional shares.

Amalgamation of accountsShareholders who receive duplicate sets of Company mailings owing to multiple accounts in their name should write to the Registrar to have their accounts amalgamated.

Unsolicited mailThe Company is obliged by law to make its share register available to third parties who may then use it for a mailing list. If you are a UK shareholder and you wish to limit receipt of unsolicited mail you may do so by registering with the Mailing Preference Service (MPS). Registration can be made online at www.mpsonline.org.uk or via telephone on 0845 703 4599.

Giving your shares to charityIf you only have a small number of shares whose value makes it uneconomic to sell them, you may wish to consider donating them to charity though ShareGift, an independent share donation scheme. The relevant share transfer form can be obtained from the Registrar. ShareGift is administered by The Orr Mackintosh Foundation, registered charity number 1052686. Further information may be obtained on +44 (0)20 7930 3737 or from www.sharegift.org

Identity theftIdentity theft is on the increase. Criminals may steal your personal information, putting your Atkins shareholding at risk.

Tips for protecting your Atkins shares:

Ensure all your certificates are kept in a •safe place or hold your shares electronically in CREST via a nominee.Keep all correspondence from the Registrar •that shows your shareholder reference number in a safe place, or destroy your correspondence by shredding it.If you change address inform the •Registrar in writing or via our share portal www.myatkinsshares.comKnow when dividends are paid and •consider having your dividend paid directly into your bank account. This will reduce the risk of the cheque being intercepted or lost in the post. If you change your bank account, inform the Registrar of the details of your new account. You can do this by post or online using our share portal www.myatkinsshares.com Respond to any letters the Registrar sends you about this.If you receive a letter from the Registrar •regarding a change of address or a dividend instruction but have not recently moved or requested a change to how you receive your dividends please contact them immediately as you may have been a victim of identity theft.If you are buying or selling shares only deal •with brokers registered in your country of residence or the UK.

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Investor Information 127

Warning to shareholdersIn recent years many companies have become aware that their shareholders have received unsolicited telephone calls or correspondence concerning investment matters. These are typically from overseas-based ‘brokers’ who target UK shareholders offering to sell them what often turn out to be worthless or high-risk shares in US or UK investments. These operations are commonly know as ‘boiler rooms’. These ‘brokers’ can be very persistent and extremely persuasive and it has been reported that the average amount lost by investors is around £20,000, with the largest individual loss being £1.2m. It is not just the novice investor who has been duped in this way; many of the victims had been successfully investing for several years.

Shareholders are advised to be very wary of any unsolicited advice, offers to buy shares at a discount or offers of free company reports. The following advice is provided:

Only ever deal with companies authorised •by the Financial Services Authority (FSA). You can check the register of authorised firms at www.fsa.gov.uk/register/Make sure you get the correct name of the •person and organisation who contacted you. Call the organisation back using the telephone number listed for them on the FSA register to verify their identity.Callers may be persistent, so hang up the •phone if they continue to contact you.Under normal circumstances authorised •firms cannot make cold calls. If you receive an uninvited call or email from an organisation of which you are not a customer, treat it with extreme caution and report the incident to the FSA either by calling 0845 606 1234 or by visiting www.moneymadeclear.org.uk

The FSA also maintains on its website a list •of unauthorised overseas firms who are targeting, or have targeted, UK investors and any approach from such organisations should be reported to the FSA so that this list can be kept up to date and any other appropriate action can be considered. The FSA can be contacted by completing an online form at www.fsa.gov.uk/pages/doing/regulated/law/alerts/overseas.shtmlInform our Registrar.•

If you deal with an unauthorised firm you will not be eligible to receive payment under the Financial Services Compensation Scheme.

Details of any share dealing facilities that the Company endorses will be included in Company mailings or on our website.

More detailed information on this or similar activity can be found on the Consumer Financial Education Body website www.moneymadeclear.org.uk

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Shareholders’ queriesWe provide a number of services to help our shareholders manage their holdings, keep up to date with our progress and communicate with us.

Reports and presentations Our reports can be accessed and/or downloaded from here.

Links to results presentations, videos, press releases and webcasts are also provided.

Share price Share price charts

Latest news

Calendar

Investor relations team

Corporate responsibilityFind out more about our Corporate Responsibility strategy and performance by visiting this section of our website.

Share priceChart showing one, two or three months’ share price activity. Click the chart to see the share price table and to access our calculators.

Latest financial newsAccess our latest financial press releases here.

AlertsReceive automated announcements and news by signing up to our alerting service.

Register for ecommsYou can help us to reduce our environmental impact by opting to receive electronic versions of shareholder communications (ecomms). Click ‘Register’ to sign up.

We will donate £1 to RedR (Register for Engineers for Disaster Relief) for each shareholder who chooses this method of communication.


To help you find the information you’re looking for, the key features of our investor relations website are highlighted below





ResultsWe have successfully navigated turbulent markets by improving our business, reducing costs and flexing our resources to meet demand. We are well positioned for when growth returns.

ResilienceThe future for the built environment will bring more complex engineering challenges as clients put greater emphasis on planning and design disciplines to achieve maximum value from their infrastructure programmes. This is what Atkins does well.

GrowthWe are investing in technical excellence and people. We are also investing to improve our business, address growth markets and take advantage of market opportunities. >

This Annual Report is printed on Revive Pure White Uncoated, a 100% recycled paper made from post-consumer collected waste and manufactured to the certified environmental management system ISO 14001. It is TCF (Totally Chlorine Free), totally recyclable and has biodegradable NAPM recycled certification. The Atkins logo, ’Carbon Critical Design‘ and the strapline ‘Plan Design Enable’ are trademarks of Atkins Limited, a WS Atkins plc company. © WS Atkins plc except where stated otherwise.

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