Strong second half drives record EY revenues for 2023
The Australian branch of professional services firm EY has brought in close to $3 billion in total revenues over its past financial year, driven by a surprisingly strong second half compared to its peers.
Professional services firm Ernst & Young has bucked a Big Four and wider consulting industry trend to post $2.97 billion in 2023 financial year revenues on the back of a strong second half.
The total figure, which includes over $300 million in client recoverable expenses, is a 13 percent jump on last year’s $2.75 billion tally, with the firm having added close to $1 billion to its annual takings since the beginning of the global pandemic.
“Revenue growth of 13 per cent is an outstanding achievement given the complexity of the challenges we have faced as a firm and an industry in the past 12 months, and we’re immensely grateful to everyone at EY who helped to achieve it,” stated regional managing partner David Larocca. “The result is a testament to the innovative thinking and dedication of our people, who continue to show their commitment to exceptional client service.”
Likewise up by 13 percent, EY’s Consulting division – which includes business and risk consulting, tech consulting, and data analytics – continues to pull ahead as the firm’s biggest money spinner, bringing in $1.1 billion of the overall total. Tax and Assurance both achieved low double-digit growth to make up the bulk of the remainder, while the firm’s Strategy & Transactions line contributed close to $500 million, to be up by 16 percent.
The strong growth however still marks a slowdown from last year’s 19 percent jump – in particular across Strategy & Transactions (down from 26 percent), and Consulting (from 24 percent) – but whereas Big Four competitors Deloitte and KPMG both noted a slowing market over the past six months in their most recent reporting, Larocca stated that overall demand for the firm’s services was in fact stronger in the second half than its first.
The firm’s Oceania CEO further added that positioning EY for long-term success had been a focus throughout the year, including through a $45 million investment into developing its talent (an increase of more than 30 percent on the year prior) and the creation of over 300 new jobs. In addition, EY appointed 81 new partners in the 12 months to July including via 50 promotions. A record 46 percent of the new partners are women.
The $2.66 billion in base income less recoverables (expenses billed to clients) maintains EY’s third spot in terms of revenue generation among the Big Four, ahead of the $2.5 billion recorded by KPMG but short of Deloitte’s $2.85 billion figure. PwC is yet to report, but is expected to post revenues around the $3 billion mark, with the fall-out from its government tax leaks affair not to be fully realised until to the end of the current financial year.
EY has also been dealing with its own internal concerns, which Larocca took the opportunity to address: “We’re taking clear steps to improve our culture and the experience of our people. We commissioned an independent review, which we have since released publicly alongside a commitment to implement the report’s 27 recommendations in full. We look forward to sharing our progress towards a more respectful and inclusive workplace.”
