LONDON—Public relations holding company Huntsworth—parent company to brands including Citigate Cunningham, Citigate Dewe Rogerson, Grayling, Huntsworth Health, The Red Consultancy and Trimedia—says underlying pre-tax profit and earnings per share for 2007 will be at the high end of market expectations.
The group told analysts last week that its performance over the past year was strong, driven by an expanding international network and investment in its healthcare business. As a result, Huntsworth expects to meet or exceed each of the five key performance targets that were established at the beginning of 2007: underlying operating margins before central costs of 20 percent; 15 percent operating margins post central costs; like-for-like revenue growth of between 5 percent and 6 percent; full year cash conversion of at least 100 percent of operating profit; and net debt at the year end to be less than £57 million.
"We enter 2008 with a substantial new business pipeline and two-thirds of our income on annual retainer and repeat business. We therefore look forward to the coming year with confidence," said the group in a statement. New clients won during the second half of 2007 include Pearl Insurance, Nike, Virgin Money, Innocent Drinks, Bovis, DSS Digital Switchover Strategy, BBC, NBC, F. Hoffman-La Roche, Allos Therapeutics and HSBC.
And separately, in a letter to The Financial Times, Huntsworth chief executive Lord Chadlington sounded a bullish note on the year ahead. "When the economy slides, transparency is increasingly demanded, making PR even more important than it is in good times. Consumer PR expenditure is underpinned as clients use it to compensate for reduced advertising spend; in financial PR, clients demand help to explain to shareholders weaker financial performance or staff cutbacks; and corporate PR tends to be used to boost the corporate brand to prevent bad news seeping into consumer behaviour…
"While clients will always want to be sure that they really get value for their PR budget, based on my experience, very few would risk going into a downturn without the certain knowledge that they had tried and tested PR counsel at their elbow."