What happened: Profit plunge but workloads held up
- According to RSHP’s newly published 2024/2025 results, their turnover rose to £26.6 m — a modest increase — but pre‑tax profit plunged, falling from £2.3 m in the prior comparable period to just £203,000. (bdonline.co.uk)
- The sharp drop in profit is largely attributed to rising staff costs: personnel expenses reportedly rose 19%. (bdonline.co.uk)
- On the face of it, that suggests RSHP suffered a major margin squeeze, even though top-line revenue held up.
Yet — and this is the interesting contrast — RSHP says that its UK workloads remained strong: workload value in the UK rose to £8.4 m last year. (bdonline.co.uk)
- RSHP noted that activity picked up in the final months of 2024, and that momentum has carried into 2025 — giving them reason to expect a “significant increase” in both turnover and profitability for the current year (to December 2025). (building.co.uk)
- Much of the optimism is tied to new, major projects: the resumption of the extension works on the British Library, and the green‑lighted 54‑storey tower at 99 Bishopsgate in London. (bdonline.co.uk)
Thus, RSHP is presenting a real‑world case where workloads (pipeline / project value) decoupled from immediate profitability — showing resilience in demand even as cost pressures squeezed margins.
Case‑Study Style: RSHP’s 2024/25 Cycle
Case Study A — Managing Cost Pressure While Keeping Projects Alive
- Situation: Rising labour costs (staff costs up 19%) along with inflation and general economic headwinds.
- Action: RSHP kept securing new UK‑based commissions, delayed staff layoffs, and accepted tighter margins for the time being, focusing on project pipeline rather than short‑term profits.
- Outcome: Revenue held up; despite margin squeeze, the firm maintained a strong order book and expects recovery in profitability as new projects ramp up.
This shows a strategic trade-off: short‑term pain for potential long‑term gain — a bet that project backlog + new wins will outweigh elevated costs.
Case Study B — Reliance on Large-Scale Projects to Stabilize Business
- Major schemes like the British Library extension and 99 Bishopsgate tower represent high-value, long-duration work.
- By anchoring its pipeline on such projects, RSHP reduces reliance on many small contracts — which can be riskier in volatile markets.
- This strategy may help buffer against sector‑wide slowdowns (e.g. in housing or small commercial sit‑downs) that affect others in the architecture/construction space.
What RSHP and Analysts Are Saying — Key Comments & Signals
- RSHP itself states that the UK market “has remained strong,” and that they’ve “secured more work than previously projected.” (bdonline.co.uk)
- The firm seems cautiously optimistic: given the pipeline, they foresee better results for the full 2025 financial year — implying that the 2024 profit slump may be a temporary blip tied to cost pressures rather than demand collapse. (building.co.uk)
- On the flip side, in past years (e.g. 2022) RSHP’s profit dropped significantly even when revenue shrank only modestly — illustrating how cost inflation and project delays in the wider construction environment still pose real risks. (bdonline.co.uk)
Analysts looking at the broader UK architecture sector note a trend: many firms report rising revenues but shrinking margins, because of rising staff costs, inflation, and increased overheads. (Moore Kingston Smith)
What It Illustrates: Risks, Challenges & What to Watch
- Profit margin vulnerability: Even with healthy workloads, cost inflation (wages, overheads) can decimate profitability. RSHP’s 2024 shows how sensitive architecture/consultancy firms are to labour costs.
- Reliance on large projects — but with concentration risk: Big projects provide stability — but also risk: delays, planning permission issues, or cancellation can hit hard. Firms like RSHP may emerge more vulnerable if high‑value schemes stall.
- Timing mismatch between contract wins and cashflow/profits: Project-based work often means expenses now, revenues later. If overheads soar before income materialises, firms risk cashflow pressure. RSHP may have navigated this, but long‑term success depends on delivery speed.
- Sector-wide pressure on smaller practices: RSHP is relatively large and diversified — but smaller architecture firms may not absorb inflation or cost shock as well. A squeeze on profit margins and cost-of-living pressures could narrow the field.
What to Watch — Looking Ahead to 2025 and Beyond
- Will RSHP’s optimism play out? Success with the British Library extension and 99 Bishopsgate could restore profitability — but execution, permits, and economic environment will matter.
- If inflation and labour costs remain high (or rise further), even healthy workloads may not guarantee stable profits — firms might need to raise fees, downsize, or streamline operations.
- For the architecture/construction sector broadly, 2024–25 may mark a shift: backlog matters, but so does cost‑control. Firms that balance both may survive; those that don’t may struggle.
- Finally, monitoring fluid factors like interest rates, construction demand, planning delays, and inflation will be critical: even resilient practices like RSHP aren’t immune to macroeconomic shifts.
- Here’s a detailed breakdown — with case‑studies and commentary — of what’s going on at Rogers Stirk Harbour & Partners (RSHP) following its “stable UK workloads despite last year’s profit plunge” update. I highlight what the numbers show, what insiders are saying, and what to watch going forward.
What happened — Profit plunge but workloads held up
- According to RSHP’s newly published 2024/2025 results, their turnover rose to £26.6 m — a modest increase — but pre‑tax profit plunged, falling from ~£2.3 m in the prior comparable period to just £203,000. (bdonline.co.uk)
- The sharp drop in profit is largely attributed to rising staff costs: personnel expenses reportedly rose 19%. (bdonline.co.uk)
- On the face of it, that suggests RSHP suffered a major margin squeeze, even though top-line revenue held up.
Yet — and this is the interesting contrast — RSHP says that its UK workloads remained strong: workload value in the UK rose to £8.4 m last year. (bdonline.co.uk)
- RSHP noted that activity picked up in the final months of 2024, and that momentum has carried into 2025 — giving them reason to expect a “significant increase” in both turnover and profitability for the current year (to December 2025). (building.co.uk)
- Much of the optimism is tied to new, major projects: the resumption of the extension works on the British Library, and the green‑lighted 54‑storey tower at 99 Bishopsgate in London. (bdonline.co.uk)
Thus, RSHP is presenting a real‑world case where workloads (pipeline / project value) decoupled from immediate profitability — showing resilience in demand even as cost pressures squeezed margins.
Case‑Study Style: RSHP’s 2024/25 Cycle
Case Study A — Managing Cost Pressure While Keeping Projects Alive
- Situation: Rising labour costs (staff costs up 19%) along with inflation and general economic headwinds.
- Action: RSHP kept securing new UK-based commissions, delayed staff layoffs, and accepted tighter margins for the time being, focusing on project pipeline rather than short-term profits.
- Outcome: Revenue held up; despite margin squeeze, the firm maintained a strong order book and expects recovery in profitability as new projects ramp up.
This shows a strategic trade-off: short-term pain for potential long-term gain — a bet that project backlog + new wins will outweigh elevated costs.
Case Study B — Reliance on Large-Scale Projects to Stabilize Business
- Major schemes like the British Library extension and 99 Bishopsgate tower represent high‑value, long‑duration work.
- By anchoring its pipeline on such projects, RSHP reduces reliance on many small contracts — which can be riskier in volatile markets.
- This strategy may help buffer against sector‑wide slowdowns (e.g. in housing or small commercial sit‑downs) that affect others in the architecture/construction space.
What RSHP and Analysts Are Saying — Key Comments & Signals
- RSHP itself states that the UK market “has remained strong,” and that they’ve “secured more work than we had previously projected.” (bdonline.co.uk)
- The firm seems cautiously optimistic: given the pipeline, they foresee better results for the full 2025 financial year — implying that the 2024 profit slump may be a temporary blip tied to cost pressures rather than demand collapse. (building.co.uk)
- On the flip side, in past years (e.g. 2022) RSHP’s profit dropped significantly even when revenue shrank only modestly — illustrating how cost inflation and project delays in the wider construction environment still pose real risks. (building.co.uk)
Analysts looking at the broader UK architecture sector note a trend: many firms report rising revenues but shrinking margins, because of rising staff costs, inflation, and increased overheads. (bdonline.co.uk)
What It Illustrates: Risks, Challenges & What’s Not Yet Certain
- Profit margin vulnerability: Even with healthy workloads, cost inflation (wages, overheads) can decimate profitability. RSHP’s 2024 shows how sensitive architecture/consultancy firms are to labour costs.
- Reliance on large projects — but with concentration risk: Big projects provide stability — but also risk: delays, planning permission issues, or cancellation can hit hard. Firms like RSHP may emerge more vulnerable if high‑value schemes stall.
- Timing mismatch between contract wins and cashflow/profits: Project-based work often means expenses now, revenues later. If overheads soar before income materialises, firms risk cashflow pressure. RSHP may have navigated this, but long-term success depends on delivery speed.
- Sector-wide pressure on smaller practices: RSHP is relatively large and diversified — but smaller architecture firms may not absorb inflation or cost shock as well. A squeeze on profit margins and cost-of-living pressures could narrow the field.
What to Watch — Looking Ahead to 2025 and Beyond
- Will RSHP’s optimism play out? Success with the British Library extension and 99 Bishopsgate could restore profitability — but execution, permits, and economic environment will matter.
- If inflation and labour costs remain high (or rise further), even healthy workloads may not guarantee stable profits — firms might need to raise fees, downsize, or streamline operations.
- For the architecture/construction sector broadly, 2024–25 may mark a shift: backlog matters, but so does cost‑control. Firms that balance both may survive; those that don’t may struggle.
- Finally, monitoring fluid factors like interest rates, construction demand, planning delays, and inflation will be critical: even resilient practices like RSHP aren’t immune to macroeconomic shifts.