Chief Executive's Statement
Our strategy
Plan, design, enable
is what we do.
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Objective and business position
Our primary objective is to create long-term shareholder value measured by growth in normalised diluted earnings per share. We are confident that our core activity, that of professional design consultant serving the built environment, will enable us to continue to perform as a successful company in spite of unprecedented economic turmoil.
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 signalling where our technical expertise gives us a competitive advantage. The majority of our business relates to our clients’ capital expenditure programmes as opposed to their day-to-day operating expenditure.
As capital programmes become more complex and our clients, in both the public and private sector, face increasing pressure on expenditure, the Group’s capabilities will remain in demand. Effective use of current assets and efficient procurement with low-carbon drivers provide a platform that plays to the Group’s strengths. Where capital programmes are demanded we are in a position to plan and design cost and carbon savings. Where more effective use of current assets is needed we can design and enable efficient life extension and imaginative alternatives – for example in ramp metering and hard shoulder running on the road networks and extending the life of existing nuclear reactors.
We remain optimistic regarding the medium-term demands for our services. Growing urban populations and all the issues connected with a low-carbon economy will require appropriate infrastructure. Quality, local understanding and breadth of skills will therefore continue to be needed. We do, however, view the near term cautiously. The global economic position has impacted demand levels in many markets. Nevertheless, governments are determined to push through stimulus packages and are aligning many of these with climate change minimisation goals. This plays well to the strengths of the Group provided the related projects can be brought to market in a timely manner. It is also possible that short-term demand for some of our services will rise as governments come to terms with the need for additional strategic planning of capital projects.
Our decentralised professional consulting organisation with its very wide range of deep technical skills provides an excellent base to respond across the Group to market fluctuations. Our ability to continue to grow, enhance and add to these skills gives us confidence of both successfully negotiating the global economic issues and continuing to meet the prime objective of EPS growth.