Johnston Carmichael hails saviour Central Belt as turnover rises to defy North Sea slump

Work in Scotland’s central belt is contributing more than half of the year-on-year growth at accountancy firm Johnston Carmichael (JC) as the North Sea downturn continues to bite.

Announcing that the Aberdeen headquarted company increased turnover nine per cent in the latest financial year, chief executive Sandy Manson said it would be challenging to achieve further growth as the effects of the slump in the North Sea weigh on the business.

Offices in Edinburgh, Glasgow and Stirling now account for 31 per cent of the overall business, Mr Manson said.

JC has felt the effects of the North Sea downturn in the form of a drop in their lucrative corporate finance work in Aberdeen, where deal activity has slowed.

An increase in restructuring work has provided some compensation, although this reflects the pressure businesses are under.

However, the firm, which has seen growth in demand for services such as outsourced payroll management as companies in the area look at new ways of working as they try to cope with the downturn, saw turnover rise to £39.6 million during the year to May 31.

This was accompanied by a modest increase in net profits – before members’ remuneration – to £11.08 million , from £10.75million previously.

JC, which also has branches in Elgin, Forfar, Fraserburgh, Huntly, Inverness, Inverurie and Perth, opened an Edinburgh office 13 years ago and another in Glasgow three years later.

Stirling was added in 2012.

Mr Manson said the central belt offered strong potential for growth, but he was also seeing good opportunities for new business in the Highlands and Moray. The firm’s more traditional heartland continued to generate plenty of business “in different shape and forms”, he added.

With JC’s home city suffering the impact of the oil slump, Mr Manson said: “In Aberdeen, we are going through one of the biggest market corrections I have seen. Firms are having to restructure to remain viable. These are challenging conditions.”

He said progress in the central belt and other parts of Scotland was likely to continue, adding: “I would expect that direction of travel.” But the firm was still enjoying growth in the north-east, he said.

JC, which employs 650 people across its 11 locations, attributed its ongoing success to developments in its range of expertise, new technology platforms and its brand development.

Mr Manson said: “We take a long-term view and we will continue to invest in all those key areas which will enable our firm to grow its capability and reputation right across Scotland.

“Food and drink, technology and professional services are particular sectors where we have strengthened our capability to meet demand.

“We’ve taken on a record number of graduates and continue to support our staff through training and development.”

JC Wealth saw its revenue rise by 9 per cent, which JC said reflected an increase in advisers and related support as well as opportunities arising from auto-enrolment and the new freedom and choices in pensions.