WS Atkins to cut 1,000 jobs

WS Atkins, the design and engineering group, is to cut approximately 1,000 jobs as a result of "uncertainty" in its Middle East and UK markets.

The company, which has been appointed the official engineering design services provider to the London 2012 Olympics, said its building design arm has been "severely impacted" by the economic conditions and the deferral of projects by the Learning and Skills Council.

The Middle East business had performed well until "confidence in the region was significantly impacted by the global economic slowdown," it added.

WS Atkins, whose business revolves around infrastructure projects, had been eyeing expansion in the buoyant Middle East as the cash-rich emirates such as Dubai and Abu Dhabi embarked on spending sprees in new buildings and transport links. However, projects are now being put on hold as the financial crisis grips the area.

WS Atkins will axe 5pc of its workforce, which totalled 18,600 last year, with 260 already cut in the UK and 200 in the Middle East. However, Keith Clarke, the chief executive, insisted its general performance and cash generation remained "good".

"The economic environment is difficult and will remain challenging, but we continue to have confidence in the underlying strength of our business," he added.

Mr Clarke said WS Atkins expects performance in the year to March 31 to be in line with expectations.

However, analysts, who are expecting annual pre-tax profits to increase from £91m to £98m, warned that the job cuts suggest WS Atkins will find 2009/2010 tough.

"In [the full-year to 2010], we are assuming that profits will start to fall," said John Lawson at Investec.