Synovate boosts annual operating profits by 21%

LONDON - Synovate, the market research division of Aegis, has registered a 20.9% increase in operating profits to 拢42.2m in 2008.

Without the positive effects of sterling's weaker value against other currencies, the increase would still have been 13.1%.

The improvement was put down to a mix of organic growth, acquisition effects and benefits from Synovate's SmartWork efficiency programme.

The company delivered strong growth in Russia and Africa, which was helped by the acquisition of Steadman, the market leader in pan-Africa, in early 2008.

However, trading was tougher in Germany and Scandinavia because those markets are weighted towards automotive and media respectively.

EMEA revenues were £248.4m, up 20.3% in sterling terms. Americas revenues were £145.2m, up 9.6%, and Asia Pacific revenues were £124.6, up 32.4%.

Synovate's overall revenues were £518.2m, up 19.7%.

The company is focusing on innovations such as combining clients' own data with its data. It is also creating dedicated community panels for individual clients, putting them in constant qualitative dialogue with their most valuable opinion-forming customers.

When parent company Aegis announced its annual results last week it revealed it expected an ongoing process of job cuts to have the effect of reducing its global workforce by 780 or just under 5%.

John Napier, chairman and interim chief executive of Aegis, said the staff reductions were being made in response both to weaker market conditions and to the need to impose more financial discipline on Aegis and make wage costs more variable and flexible.

Napier said: "The intent is to selectively address capacity, resource and variable cost elements in both divisions [Aegis Media and Synovate].

"This involves a regrettable but necessary headcount reduction of just under 5% of our workforce, spread across more than 40 countries."

Napier has denied that he had discussed a merger between Aegis and Havas with Vincent Bollore, Havas chairman and owner of 29.9% of Aegis. In recent months, it is understood Bollore has been working on a 90p per share bid, but delayed his move after Aegis decided it may sell Synovate.

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