21st Sep 2018 10:10
LONDON (Alliance News) - Advertising firm M&C Saatchi PLC hiked its interim dividend Friday after profit jumped as it continues to expand the business through the opening of new offices and its long-standing finance chief prepares to leave.
For the six months ended June, pretax profit widened 12% to GBP10.9 million from GBP9.7 million the year prior. This was after revenue rose 78% to GBP215.4 million from GBP121.0 million the year before.
Revenue performance was boosted by the adoption of new accounting rules which changed how revenue from contracts with customers was reported. The changes also saw cost of sales jumped from nothing the year prior to GBP88.2 million. The result was that gross profit grew at a more modest 5.1% to GBP127.2 million from GBP121.0 million the year before.
"The group recorded good gross profit and strong earnings increases over the first half of 2018," M&C Chief Executive Officer David Kershaw said. "In keeping with our established and proven strategy, we continue to start new businesses and open new offices. This will propel growth in future years."
During the period, M&C opened two new offices in Jakarta in Indonesia and Hong Kong.
M&C proposed a 2.45 pence per share interim dividend, up 15% from 2.13p the year prior.
"The second half of 2018 has started well with trading in line with expectations," Kershaw added.
In a separate announcement on Friday, M&C explained Finance Director Jamie Hewitt will leave the firm some time over the next 12 months. Hewitt has been at M&C for nearly 15 years and will remain in post until a successor is appointed.
"As group FD, Jamie has done a fantastic job," M&C Chairman Jeremy Sinclair said. "Our profits have gone from around GBP10m to GBP26m, dividends from 3.60p a share to 9.53p. What's equally remarkable, is that he has managed at the same time to be an extremely likeable human being. We will miss him."
Shares in M&C were 1.3% higher at 382.00 pence on Friday.
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