FTSE 250 engineering firm WS Atkins said its performance in the second quarter has not changed since its update at the start of August and it remains on track to meet expectations for the year.

The UK focused design and engineering consultancy company, which has invested heavily in growth markets to cushion its exposure to turbulent market conditions, said the good start to the year in its UK business has continued, with a modest increase in overall headcount in the year to date.

"Following the successful completion of the London 2012 Olympic and Paralympic Games we are commencing work on the legacy infrastructure," it said in a company statement.

Elsewhere its consultancy business in North America continued to experience weak market conditions. Atkins said it took further steps in the first half to reduce costs. It added that it is making progress on the close out of legacy contracts in the Peter Brown construction management at risk business.

The group reiterated that its first half performance in the Middle East will reflect project delays and lengthy contract variation negotiations, as well as increased working capital requirement across the region.

Asia Pacific and Europe is trading in line with expectations and Scandinavia put in a particularly strong performance in the first half.

The group's energy business continues to trade well in buoyant markets across all sectors. In the UK nuclear market, its new partnership with Areva is expected to put it in a strong position to target decommissioning, waste management and clean up opportunities.

Headcount has increased during the year to date to around 17,700, up from 17,420 at the end of March, with particular growth in the energy division.

"Overall, the outlook for the group for the year remains unchanged and in line with our previous expectations at the time of the interim management statement on August 1st."

Broker Charles Stanley reiterated its 'reduce' recommendation on the stock. 'Outlook for the full year remains unchanged implying flat PBT [profit before tax] growth following the downgrades in its US operations,' Charles Stanley's Andy Smith said.

'We have recently downgraded our recommendation to Reduce as we believe the outlook for the US will get worse before it gets better as Atkins is heavily reliant upon public sector funding which is under pressure - hence our belief that the US has the potential to disappoint further,' he continued.


CJ

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