Chime Puts U.S. Expansion Plan on Hold
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Chime Puts U.S. Expansion Plan on Hold

Chime Communications has reported a 31 percent jump in first-half pretax profit, improved margins and increased market share. But it also says it will put its U.S. expansion plans on hold until market conditions improve.

Paul Holmes

LONDON, September 11—Chime Communications, the parent company of British public relations leaders Bell Pottinger and Good Relations, has reported a 31 percent jump in first-half pretax profit, improved margins and increased market share. But it also says it will put its U.S. expansion plans on hold until market conditions on this side of the Atlantic improve.
 
Chime, best known in the U.K. for its public affairs and corporate reputation work, made its first foray into the U.S. earlier this year, acquiring Boston-based technology public relations specialist LNS Communications for £11 million. It had been in talks with at least one other firm: a prominent New York investor relations specialist.
 
But in a statement accompanying its first-half results, the company said it was putting further expansion plans on hold. According to chairman Lord Tim Bell, “It remains our intention to expand further into Germany and the United States of America although in the current market conditions our plans have been delayed particularly in relation to the United States.” Bell added: “It’s a very difficult market, the capital markets are virtually closed to us.”
 
That setback was offset by strong first-half performance in the company’s core businesses. Pretax profit climbed to £8.4 billion (around $11 million) on operating income of £50.9 million. Profit margins were up 0.6 percent to 17.7 percent. Chime’s share price, down from a high of 230 pence one year ago, was up 3 percent to 137 ½ on the results.
 
Bell Pottinger is ranked number three in the U.K. public relations league tables—published by PR Week—and Good Relations is ranked number 10. Major projects in the first half of the year included the demutualization of Friend Provident, the defense of Abbey National against a potential bid from Lloyds TSB, the management buyout of GO from British Airways; and Beijing’s successful bid to host the 2008 Olympic Games.
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