LONDON (Brand Republic) - Cordiant Communications, the UK advertising group that owns Bates Worldwide and was formerly owned by Saatchi & Saatchi, has announced a 79% surge in profits.
Full-year pre-tax profits rose to £57.5m, up from £32.3m during 1999, backed by acquisitions and a rise in operating profit, up 83.8% to £61.4m from £32.3m the previous year. The figures beat analyst forecasts of operating profit at £58m-£59m.
The positive results boosted Cordiant鈥檚 share price 2.8% or 8p to 292p from last night鈥檚 close of 284p.
New business wins were a record £513.4m in annual billings, with a further £102.6m of new business won during the first two months of 2001.
The group said further growth was to come through acquisitions and that it had three financial targets to hit before 2003. Cordiant wants to drive organic revenue ahead of the market at 11% plus, to increase its current operating margin of 12% to 15%, and increase its annual growth in earnings by at least 20%.
The group also said it plans to increase the proportion of marketing communications to two-thirds of total revenue by 2003. Since its split from Saatchi & Saatchi in 1997, it has striven to expand its marketing services operations. In 2000, they represented 50% of its earnings, the other half came from advertising. Three years ago, advertising accounted for 80% of its revenues.