US-listed FTI today released its full-year results, which show total revenues across the professional services firm of $1.81bn (£1.46bn) in 2016. This is a 3.6 per cent increase on 2015 when adjusted for the impact of currency fluctations.
Strategic Communications brought in revenues of $50.3m in Q4 2016 - an increase on Q4 2015 of 8.8 per cent when adjusted for currency fluctuations. It follows a decline in Q3 2016's result as a result of a one-off media buy FTI had made in Q3 2015.
The company as a whole grew a currency-adjusted 2.6 per cent in Q4, with revenues of $441.9m.
Full-year revenue in the Strategic Communications business rose 0.6 per cent to $191.2m. Adjusted for currency fluctuations, growth was significantly higher, at 4.5 per cent.
Adjusted underlying earnings (EBITDA) in the division rose 9.8 per cent to $30.5m in 2016.
The increase in revenues for the communications segment in Q4 "was primarily due to higher project-based revenues in the EMEA region, driven by public affairs and financial communications engagements", a release announcing the results said.
Ed Reilly, global CEO of FTI Consulting’s Strategic Communications arm, told PRWeek the division has been "really picking up momentum in the past couple of years" around public affairs, but major political events are also fuelling growth.
"Brexit, as well as other turbulence in Europe that has put people on alert as to potential changes in their permission to operate... has elevated these issues into the c-suite, and we do find increased activity."
He said the situation is the same in North America.
Reilly described 2016 as "a somewhat mixed year" overall, citing the "volatility" linked to the UK's EU Referendum result and Donald Trump's election.
"I also think uncertainty has affected investment into emerging markets. 2016 was not the year it was in 2015 in terms of the volume of capital markets activity. But it was, however, a year where there were substantial opportunities to work with clients, whether they were managing change, mitigating risk or trying to resolve disputes around the globe."
Reilly pointed to employee engagement as a particuarly strong growth area in 2016, along with the Financial Institutions Group, linked to comms needs around regulatory changes; energy and natural resources, following a rebound in oil and gas prices; the chemicals and industrials sector; life sciences and healthcare; and telecoms and technology, due to more M&A activity in that market.
However, he said the retail sector "has been soft" overall, citing clothing retailers in particular that have been hit by e-commerce.
Adjusted EBITDA for Strategic Communications was $8.4m in Q4, up from $7.6m in the same period last year. This meant the unit's margin increased from 15.6 per cent to 16.7 per cent.
Steven H Gunby, president and CEO of FTI Consulting, said it had been "another year of strong performance in Strategic Communications".
On adjusted EBITDA for the business as a whole having dropped by $2.8m to $203m, the press release said: "Adjusted EBITDA growth in the Economic Consulting, Corporate Finance & Restructuring and Strategic Communications segments was more than offset by Adjusted EBITDA declines in the Technology and Forensic and Litigation Consulting segments and higher corporate costs. The decline in Adjusted EBITDA and Adjusted EBITDA Margin was also impacted by higher costs, primarily from higher compensation related to an increase in aggregate headcount, which was not sufficiently offset by higher revenues."
The segment's 2015 revenue had been flat on the year before, as reported in the 2016 PRWeek Global Agency Business Report.
This article was updated on Tuesday afternoon with comments from Ed Reilly.