Net debt rose by almost 65% to £4.4m following £5.4m of acquisition-related payments in the period. Bite Group acquired an 80% stake in two German-based comms businesses, Trademark Public Relations and Trademark Consulting, and the debt figure also reflects contingent consideration payments for the acquisitions of M Booth and The Blueshirt Group.
Chairman of Next Fifteen, Richard Eyre, commented: ‘Next Fifteen's strategy to focus on digital marketing is delivering positive results. The group's dedicated digital agencies continue to perform strongly, delivering organic revenue growth of 39%. The group is now focused on ensuring that knowledge and expertise gained in digital are spread and adopted by the rest of the portfolio.’
However, the group added that its UK consumer business has ‘been slower to adapt’, with consumer business declined 2 per cent overall in the six-month period. The company has restructured the UK consumer business to accelerate its transition to digital, including changes in senior management, a greater emphasis on digital services and a rebranding of the business.
The Next Fifteen statement read: ‘Encouraged by our successes in the US consumer PR market, we are accelerating our digital investment in our UK consumer activities as part of a more general restructuring of this business. This will be completed by the year end and will result in restructuring costs of approximately £0.4m in the current financial year (£0.25m in the first half), for benefit in 2013 and beyond.’
Regionally, APAC saw revenue growth of 14% (organic growth of 10%), while the US and UK grew by 9% and 13% respectively, with 3% of this being organic in both cases.
In terms of outlook, Next Fifteen stated: ‘The group is seeing a strong flow of new business opportunities in all regions except some parts of mainland Europe. Overall, before the impact of the restructuring costs above, we anticipate profits for the full year 2012 to be modestly ahead of management expectations.’