By Benjamin Chiou
Date: Wednesday 10 Apr 2024
LONDON (ShareCast) - (Sharecast News) - Shares in advertising agency M&C Saatchi fell on Wednesday after the company reported a 10% drop in annual profits which it blamed on "challenging market dynamics", though it said it first-quarter trading had been encouraging.
Scaled-back client marketing budgets during 2023 meant that group revenues were down 2% at £453.9m, though strict cost control and the exit of non-core business resulted in a "material" profit improvement in the second half, which helped to mitigate the impact on the bottom line.
Pre-tax profit declined to £28.7m, from £31.8m, but operating profits were up 30% year-on-year in the second half. The company realised £3.9m of annualised cost savings and exited non-core businesses representing £9m of revenue of £3m of operating losses.
The operating margin averaged 12.8% for the year, but jumped from just 8.3% in the first half to 16.9% in the second.
The company, who is set to welcome new the former marketing head at Channel Four, Zaid Al-Qassab, as its new chief executive in May, is ready for "its next phase of growth, building on a simplified operating model and supported by our exceptional leaders", according to executive chair Zillah Byng-Thorne.
"We are encouraged by our performance in the start to the year, and while macro-economic uncertainty across our markets remains, our continuing transformation, which is already delivering, underpins our confidence that we will meet expectations," Byng-Thorne said.
Email this article to a friend
or share it with one of these popular networks:
Price | 11,783.68 |
Closing Price Change | -75.92 |
% Change | -0.64 % |
29-Apr-24 Close | 11,783.68 |
You are here: research