Engineering group Arcadis eyes full-year growth despite quarterly dip

By Thomas Escritt AMSTERDAM (Reuters) - Dutch engineering company Arcadis stuck to its full-year targets despite reporting a 1 percent fall in third-quarter revenue on Wednesday, saying that a strong order book will put it back on track by year-end. The decline in quarterly net revenue was down to weak demand in North American water and engineering markets and a slowdown in the Latin American mining sector, the company said. Excluding the 7 percent fall in the Americas, worldwide organic growth was at 4 percent. The company, which carries out engineering, consulting and construction projects, said a rise in order intake, a solid market outlook and the impact of recent acquisitions meant it would meet growth targets, achieving a 5 percent increase to net revenue and 10 percent profit growth this year. "Organic growth (is) moving towards our three-year target of above 5 percent, with the exception of North America," Chief Executive Neil McArthur said. "Tough conditions in that region's environmental and water markets continue to weigh on revenues, though strong order intake provides confidence for a return to growth in 2015." The company recorded growth across the board in its buildings business, which contributes almost a third of revenue, led by high levels of capital expenditure in the Middle East and Continental Europe, with order intake up 7 percent. The environment business, which contributes another third, was tougher, particularly in the United States, where a shortage of public sector projects had pushed down prices. Market conditions in Britain were also difficult, it said. In infrastructure, which contributes a quarter of revenue, significant wins in the Americas had helped to boost orders by 9 percent. Arcadis posted third-quarter net revenue of 475 million and operating earnings before interest, tax and amortisation (EBITA) of 49.5 million. Its EBITA margin rose to 10.4 percent, up from 10.1 percent over the year to date. The company recently bought British engineering consultancy Hyder and U.S. architectural consultancy Callison. The deals, which are expected to lift annual gross revenue above 3 billion euros, are not reflected in the third-quarter accounts. (Editing by David Goodman)