Huntsworth Enjoys Healthy First Half Growth, Margins
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Huntsworth Enjoys Healthy First Half Growth, Margins

Huntsworth, the international public relations group that owns Citigate Dewe Rogerson, Global Consulting Group, Grayling, Hudson Sandler, Red Consultancy and Trimedia, enjoyed healthy organic growth and improved operating margins during the first six months

Paul Holmes

LONDON—Huntsworth, the international public relations group that owns Citigate Dewe Rogerson, Global Consulting Group, Grayling, Hudson Sandler, Red Consultancy and Trimedia, enjoyed healthy organic growth and improved operating margins during the first six months of the year, according to interim results announced this week.

The firm added £30 million of net new business during the six months ended June 30, 60 percent from existing clients. The underlying operating margin before central costs and highlighted items for the group’s public relations businesses—which accounts for 90 percent of its total revenues—was a little over 20 percent. Pre-tax profit on continuing operations rose from £1.31 million to £5.02 million on revenues of £70.1million (£40.7 million).

“The first half has given us a strong start and a firm foundation for the full year,” says group chief executive Lord Peter Chadlington. “We have been encouraged after the summer months by the marked pick up in new business activity which gives us confidence for the full year.”

Huntsworth now has 45 principal offices in 20 countries, more than 2,500 clients and 1,500 staff. Full service public relations work accounts for 31 percent of Group revenue; corporate communications and public affairs 24 percent; financial public relations 21 percent; healthcare 11 percent; and deal-related financial work 9 percent. Almost half (48 percent) of Group revenue is from the U.K., 27 percent from the U.S., and 22 percent from other European countries.

Chadlington says new media has been a major driver of growth across all businesses in the healthcare, financial, consumer and corporate sectors. “The power of ‘user-generated content’ is recognized and harnessed by all our operations. We have developed innovative new media techniques to respond to the challenge of reaching targeted stakeholder groups. We also provide comprehensive monitoring and early warning processes for organizations within their reputation management programs.”

Analysts responded favorably. According to the FT, “Huntsworth shares have had a reasonable run, outperforming the FTSE media index by 12.1 percent. That has left the group trading at about 11.7 times forecast 2007 earnings per share. That is a higher multiple than listed peers in PR but a discount to groups more dependent on media advertising. Yet there is evidence that PR would hold up better in a slowdown in marketing spend. With analysts retaining target prices for Huntsworth shares in the 110p to 120p range, the stock is worth a look.”

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