27th Jan 2016 08:55
LONDON (Alliance News) - Marketing communications group Creston PLC on Wednesday said its revenue growth accelerated in the third quarter to the end of December against the first half, but said it will book charges which will knock back its full-year profit.
The news dragged Creston shares down 17% to 102.00 pence early Wednesday, one of the worst performers in the London market.
Creston said its revenue grew 11% year-on-year in the quarter to the end of December, against 8.0% growth in the first half. Like-for-like revenue rose 2.0% in the quarter, up from 1.0% in the first half.
But Creston said it has been advised by some of its clients in the first weeks of 2016 of project delays and cuts, driven in some cases by client-specific issues but in others by a general sense of caution about the economic outlook for the year.
As a result of this, revenue growth in the fourth quarter to end March will slip significantly compared to Creston's expectations and, given the little time for the group to turn this around, will mean its operating profit will take a hit.
The group expects its full-year revenue will be up around 8.0% but said its headline pretax profit, which strips out property-related costs, start-up net losses, acquisition costs and restructuring costs, will be slightly lower than the GBP9.9 million it posted a year earlier and will likely include a goodwill impairment charge.
"We are disappointed to have been impacted in January by a combination of one-off circumstances specific to certain clients and a cautious outlook from others, but with the good progress against our strategy, the full year effect from our new client wins and operational efficiencies made earlier in the financial year, we are establishing a strong foundation for future growth," said Barrie Brien, Creston's chief executive.
By Sam Unsted; [email protected]; @SamUAtAlliance
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