Boardroom Insight

Consulting Sector News and Trends

Arcadis delivers 12.3% organic growth in its fiscal first quarter

Arcadis’ revenue rose to €940 million in the first quarter thanks to strong demand for infrastructure engineering services that also grew the company’s backlog.

In percentage terms, Arcadis’ revenue grew 12.3% year-over-year during the quarter. There are signs that this growth could start to slow in the next few quarters.

For investors’ sake, Arcadis tracks the value of engineering projects that it has won but hasn’t yet been paid for. The value of those projects rose 3.9% on an organic basis in the first quarter, which is about half the backlog growth rate the firm posted during the year-ago period.

But though growth may be slowing, Arcadis still has an impressive deal backlog of €3,192 billion, a sum that is about three times larger than its annual sales.

Amsterdam-headquartered Arcadis is one of the world’s top engineering consulting firms. Its more than 30,000 employees help design bridges, motorways, water management systems and other types of infrastructure for clients all around the world.

Over its more than 100-year history, Arcadis has racked up quite a few notable projects. One of the standout items in the firm’s portfolio is the work it did on the Millau Viaduct, the world’s tallest bridge, which stretches across a 2.4-kilometer valley in Southern France.

Arcadis not only disclosed revenue numbers in its first quarter earnings call but also shared an update on its long-term growth vision. The leadership team informed investors that the integration of IBI Group and DPS into the firm’s business is on track.

IBI Group and DPS are two engineering consultancies that Arcadis bought late last year. The two deals grew its headcount by more than 10%.

Toronto-based IBS Group has more than 3,500 professionals in 60 offices worldwide. DPS, in turn, is an Irish engineering consultancy with a slightly smaller headcount and a focus on building high-tech facilities such as semiconductor manufacturing centers. 

Arcadis also gave investors an update about its bottom line. Its operating EBITA, a financial metric that helps shareholders understand a firm’s profitability, reached €92 million in the first quarter.

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