Foster + Partners blames tough economic environment for wiping millions off value of worldwide business

Lord Norman Foster's architectural practice reported a pre-tax loss of £142m in the year to 30 April 2013. Photograph: Myung Jung Kim/PA Archive/Press Association

Lord Norman Foster's architectural practice, which this week unveiled designs for Battersea power station flats to stand opposite the titanium facades of those by Frank Gehry, has blamed the "tough economic environment" for wiping nearly £130m off the value of its worldwide business.

Britain's largest architectural practice, which built the Millennium Bridge and "the Gherkin" in London, reported a pre-tax loss of £142m in the year to 30 April 2013, following a profit of £5.7m the year before, according to its latest accounts filed with Companies House.

Foster + Partners wrote down the value of its business by £129.4m to £150m due to falling underlying profits at its international subsidiaries, Foster Group (International) and Piers Heath Associates. Foster's has more than 50 projects on site across five continents, including Apple's campus in California and Bloomberg's London headquarters, and has in the past been behind a host of big projects abroad including the Berlin Reichstag, airports at Beijing and Kuwait and the HSBC building in Hong Kong.

Turnover fell slightly, to £152.7m from £161.5m, with revenues from Asia, the Middle East, Africa and continental Europe down from the year before, while sales in North and South America rose and the UK was flat at £16.8m.

The firm's chief executive, Mouzhan Majidi, left in February, and Foster's said it would replace his role with that of a managing partner, and was looking for someone with a management (rather than architectural) background.

Lord Foster, the chairman who founded the firm in 1967 with his late wife Wendy, said the year had got off to a slow start in terms of earnings, but the firm recovered much of that in the second half of the year. "In an economic environment which continues to be shrouded in uncertainty, it is not surprising that this is reflected in the pattern of our practice throughout the year."

He said the year saw a record number of projects delivered and at 30 April 2013 the order book stood at an all-time high of £290m.

He took a pay cut for the second year in a row. The accounts show that the highest-paid director at the practice, thought to be Foster, was paid £605,000 in 2012/13, down by a third from £920,000 the year before. The firm employed 1,039 people, compared with 1,170 the year before.

> via The Guardian