20th May 2015 09:25
LONDON (Alliance News) - Corporate services company Hogg Robinson Group PLC on Wednesday said its pretax profit fell in 2014 on the back of lower revenue, dragged back by the strength of sterling and by ongoing structural changes in the travel management segment.
The company, which provides travel, expense and data management services, said its pretax profit fell to GBP23.2 million from GBP25.3 million a year earlier, resulting from a 3% drop in revenue to GBP330.1 million from GBP340.8 million. Revenue was up 1% on a constant currency basis, with client transaction activity increasing 6% and constant currency travel spend up by 3%.
Revenue was pushed lower in the year by weak market conditions in Continental Europe and Asia, Hogg Robinson said, with a continued recovery in the UK and North America failing to offset those problems.
Results also were hit by a faster-than-expected transition by its clients to online self-booking of travel, with 47% of client travel booking self-booked in the year, up from 42% a year earlier. Hogg Robinson, in response to the shift, further cut the size of its network and has continued to restructure its operations to deal with the changes.
The group said it will hike its final dividend by 7% to 1.69 pence per share, meaning its total dividend for the year is up 55 to 2.32 pence per share from 2.21 pence a year earlier.
Hogg Robinson expects a further recovery in the UK and North American travel markets in its 2016 financial year, though it said it expects conditions in Continental Europe and Asia Pacific to be broadly similar to 2015.
"We operate in an industry undergoing significant change, driven by new technologies. For our part, whilst the changes have created some short-term headwinds, we are well placed to capitalise on the opportunities that are also presented. As we look ahead to the current financial year, we will continue to execute against our strategic priorities which provide a solid platform for accelerated growth," said Chief Executive David Radcliffe.
Shares in Hogg Robinson were up 2.0% to 50.50 pence on Wednesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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