KPMG UK reports strong growth amid challenging market conditions

01/02/2024
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KPMG UK has announced robust revenue growth of 9%, reaching £2.96 billion for the financial year ending September 30, 2023. Despite global market challenges, the firm’s net sales saw an 8% increase, driven by client demand for tax transformation advice and the application of Generative AI. 

KPMG’s consulting arm also experienced a 7% rise in sales, focusing on transformation projects like digitization. However, deal advisory sales decreased by 6% due to a slowdown in the global deals market. The firm’s audit practice demonstrated significant growth, increasing by 19% amid expanded reporting requirements.

KPMG UK’s Chief Executive and Senior Partner, Jon Holt, commended the team’s efforts in delivering strong revenue growth in a challenging economic backdrop. He highlighted the increasing importance of digitization and emerging technologies in meeting client demands and gaining a competitive edge. Holt expressed confidence in the long-term strategy, emphasising the firm’s commitment to transforming the business for sustainable growth.

Holt said, “our people have worked exceptionally hard to deliver strong revenue growth against a challenging economic backdrop. Digitisation and emerging technologies are at the forefront of our clients’ minds, and we have the expertise to meet demand and help them gain a competitive edge.”

The firm’s investment in retaining and attracting talent played a crucial role in its growth strategy. Despite a reduced profit before tax of £364 million, reflecting a 17% increase in staff costs, KPMG remained committed to supporting its people. The firm’s headcount increased by 12%, with a focus on hiring 2,573 new employees and promoting 1,945. The investment in people aimed to maintain skills and experience to meet market demand.

James Kergon, Scotland senior partner for KPMG, wanted to share some regional highlights from Scotland over the past year. “There is no doubt that it has been a challenging market so I am pleased to see our support for local business and organisations reflected in growth in Scotland.” He expressed.  “First and foremost, I’m proud of the difference our people are making in the community.   Under our Opening Doors to Opportunities campaign, we are inviting schools in Scotland with less access to workplace opportunities, into our offices, as part of our UK wide commitment to give one million young people the opportunity to develop their business skills by 2030.   In addition to this, our colleagues have been volunteering their time to provide numeracy, literacy and employability skills support to both primary and secondary school students across Scotland – in schools, in our office and virtually.  This year we also extended this to host young people with special needs to obtain work experience with our KPMG teams. A total of 332 colleagues also signed up for KPMG’s ‘Big Walk’ in Scotland in support of our charity partner Marie Curie.”

In the pursuit of future growth, KPMG globally collaborated with Microsoft, expanding their cloud and AI alliance to enhance services across Audit, Tax, and Advisory. Additionally, a new global alliance with MindBridge brought advanced AI into KPMG’s digital audits, incorporating statistical, machine learning, and rules-based analytics technology.

KPMG’s commitment to supporting regions and communities was demonstrated through various initiatives. The firm expanded regional expertise by investing in the north, opening a new Ignition Centre in Manchester, a collaboration hub for innovation and technology. KPMG launched the “Opening Doors to Opportunities” community program, aiming to provide one million young people with skill development opportunities by 2030.

KPMG’s strong emphasis on social responsibility included a record-breaking 49.7% of its people volunteering or fundraising for important causes. The firm successfully raised £1 million in 2023 for its national charity, Marie Curie. Moreover, KPMG achieved its target of using 100% renewable electricity by 2024.

Looking ahead, KPMG made strategic decisions to adapt to client demand, combining its deals and consulting practice to create a unified Advisory business. Additionally, exploratory discussions have commenced with KPMG Switzerland to merge the two firms into one combined entity. Jon Holt emphasised the transformative decisions made in 2023, positioning the firm for growth in 2024 and beyond.

In conclusion, KPMG’s financial and non-financial metrics showcase its resilience, commitment to sustainability, and ongoing efforts to contribute positively to communities and regions.

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