4th Jul 2006 07:01
Huntsworth PLC04 July 2006 4 July 2006 Huntsworth PLC Annual General Meeting Trading Update for the half year ended 30 June 2006 Highlights: • "Excellent first six months" Jon Foulds, Non-executive Chairman • Profits for first six months ahead of market estimates • Organic growth for PR companies comfortably ahead of comparable period last year • Over 20% PR operating margins • Intention to pay interim dividend of 0.6p per share, up 20% The following statement will be made by Jon Foulds, Non-executive Chairman, atthe Annual General Meeting of Huntsworth PLC to be held in London at 11.00 a.m.today: "As a result of the transformational changes of the last 18 months, I amreporting to shareholders later this year than will be our future practice.Exceptionally, therefore, I am combining my usual comments with our tradingupdate. The Half Year At operating company level our profits will be ahead of market estimates. Wealso expect profit after tax for the first half to be ahead of market forecastseven after the new imputed interest on earn out liabilities and the IFRStreatment of our Group incentives. This is due to sustained downward pressure oncosts and a lower than forecast tax charge. As we are only a few days into the second half of the year, I will also, at theinterim stage in September, bring shareholders up to date on prospects for thefull year when we have seen how far this momentum is continuing in the secondhalf, plus the impact of the new incentive schemes before you today. There will be no material exceptional restructuring charges in the period. In the half year, over 90% of our revenues will be in Public Relations - ofwhich 70% is either retainer or repeat business. Overall operating margins will be in excess of 19.5% - with our PR companiesshowing in excess of 20%. Organic growth in our PR companies will be approaching 5% - which is nearly 50%ahead of the comparable period last year. At the half year, we expect to raise the interim dividend by 20% to 0.6p pershare (2005 0.5p per share). Huntsworth and its clients In the first six months, we have won some £25m of net new fees which will berecognised in 2006. New clients include John Lewis Partnership (where we handle both Corporate andFinancial PR), Waitrose (launch in Scotland), Royal Mint (PR and PublicAffairs), BDO Stoy Hayward (regional PR in the south of the UK), a pilot PRprogramme for the RSPCA and Grupo Ferrovial, S.A. (on their bid for BAA plc). We have been awarded additional mandates from many existing clients includingfurther project work for Deutsche Telekom AG, National Grid Transco plc and YellGroup plc. We also assisted Lookers plc on their successful defence against ahostile offer from Pendragon plc. We are receiving more mandates from clients across a number of our offices,geographies and practice areas. There is growing evidence that our network isbeginning to work efficiently and meeting new client needs. For example, Trimedia was recently awarded the 13 country PR programme for COLTTelecom Group plc. Roche Diagnostics International has appointed HuntsworthHealth across its integrated communications offering. In the US and the UK, GCGnow work for Harry and David Operations Corp. In the UK regions, HarrisonCowley is working for McDonald's Corporation following a referral from Red whichhandles McDonald's corporate PR. Huntsworth and the PR Market We are now one of the two largest independent PR Groups in the world. In the UK,we are the third largest of all PR Groups - whether part of a marketing servicesconglomerate or not - and are closing fast on the number 2. Harrison Cowley is now the largest UK Regional PR company. In ContinentalEurope, Trimedia has established offices in eleven countries - in eight of whichwe are now in the top five. But what about work quality and peer group recognition? Red received three industry accolades from the Holmes Report in 2005: BestEuropean Consumer Agency, Best Sponsorship and Best Public Sector Campaign, In 2006 the Holmes Report made Red "The Company you would most like to work for"and the CIPR awarded the agency the Best Technology award. Trimedia Austria received the "2006 SABRE Award in Sponsorship Category" andTrimedia UK was one of only 30 companies to receive 3 stars under the newaccreditation "Best Company Star Awards". Last month, PR Week, our trade magazine, reported that in a survey of 150European IR Directors, Citigate Dewe Rogerson (CDR) was recognised as the bestknown and the most respected investor relations agency in the UK. Last month,the same magazine, reported that CDR was the top ranked M&A PR advisor. Inaddition Merger Market recognised CDR as the Number 2 M&A PR Advisor in both theUK and Europe. I could give you more examples - but let me just say that Huntsworth Health, GCGand Harrison Cowley have all been publicly lauded in the last year as have somany of our other businesses, both small and large. Interim Results and new research With our half year numbers in September, we will be presenting a new analysis ofour public relations business by both geography and across the sectors that weserve: healthcare, financial (project and retainer), corporate, public affairs,consumer, business to business and internal communications. To give shareholders a clear idea of how our business is growing, we willpublish these sector reports on a regular basis and use the 2006 results as thebase year against which to measure future growth and sector trends. We are reviewing our financial calendar. We will accelerate our reportingtimetable over the next financial year. Board Committees Our Board committee structure has been working well and has been busy over thelast six months. First, a committee under the Chairmanship of our Senior Independent Director hasconsidered a possible change of name of our holding company. When our mergerwith Incepta was announced, we indicated that we would ask shareholders whetherthey would approve such a name change. We employed MORI to carry out apreliminary survey for us both internally and externally in the City, amongstadvisors, analysts and shareholders. It was quite apparent from this researchthat there was no appetite for a change and we are therefore continuing with theHuntsworth name. After an extensive internal and external search by the Nominations Committee, weappointed Sally Withey as our new Finance Director. Sally, who has been withHuntsworth for over two years, continues to make a great impact on our businessand, on behalf of all shareholders, I warmly welcome her to the Board and tothis new role. Sally succeeds Roger Selman, who was our Finance Director for over four years.Roger was recently - and rightly - voted one of Finance Week's Top 100performers in 2005. Without Roger, we would never have achieved the progress weare reviewing today. We owe Roger an enormous debt of gratitude for his loyalty,his hard work and his determination to do what is in shareholders' interest. Robert Alcock, our Senior Independent Director, is also chairing the Committeewhich will select my successor. The Committee, assisted by an external searchfirm, expects to report before the end of this financial year. Charles Good will be stepping down from the Board after serving as a non-executive director of Citigate and then Incepta since 1988. He has been a towerof strength during the integration process and I thank him on behalf of us all. Conclusion In all probability, this will be my last Huntsworth AGM. I am delighted that Iwill be able to hand over our company in such robust health. I am particularlypleased that we now have a Senior Executive Team of such depth and experience.They are well equipped to take this business forward in the years ahead. I would like to thank all those who make Huntsworth a success - our clients,staff, shareholders and suppliers. Thank you for all the support you have givenme and the Board over the last six years." For further enquiries, please contact: Huntsworth plcLord Chadlington, Chief Executive Tel: (020) 7408 2232Sally Withey, Finance Director Tel: (020) 7408 2232 Citigate Dewe Rogerson Tel: (020) 7638 9571Simon Rigby / Brett Jacobs / George Cazenove This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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