Chime PR profits climb despite 2% revenue drop

Chime Communications reported increased profits on marginally lower PR revenues in 2012 after the sell-off of its Bell Pottinger PR businesses.

Chris Satterthwaite: Chime chief executive
Chris Satterthwaite: Chime chief executive

The Good Relations Group, which incorporates Harvard PR, saw a 2% decline in like-for-like revenues to £18.8m during the full year 2012.

The division’s like-for-like operating profit rose by 80 per cent to £1.9m in 2012 on an operating profit margin of 9.9%. In 2011 the Good Relations businesses made operating profits of £1m on revenues of £19.3m.

The PR division encompasses just those businesses incorporated into the Good Relations Group, with PR revenues from Fast Track, Teamspirit and healthcare accounted for elsewhere on the balance sheet.

The results come after the group sold a significant chunk of its PR division for £19.6m in a management buyout led by its founder and former Chime chairman Lord Bell in July last year, though Chime retains a 25% interest.

As such, the group’s overall PR revenues were significantly down from the £69.2m recorded in 2011. The MBO included some of the group’s higher margin PR businesses, such as Pelham Bell Pottinger, meaning that the PR operating margin was significantly reduced from the 25.2% the group achieved in 2011, resulting in profits of £17.5m.

Overall, Chime’s operating income rose by 35% to £157.5m (discounting 2011 revenues from Bell Pottinger) and the group achieved a 64% rise in operating profit to £25.7m.

The results were particularly impacted by the group’s work across the Olympics and Paralympics, with Chime recording huge growth in its sports marketing and entertainment business. The division, which also includes sport-related PR revenues, saw revenue rise by 65% to £65.9m, achieving profits of £15.8m.

Chief executive Chris Satterthwaite said: ‘There has obviously been a lot of change within our PR business during the year, but communications remains absolutely central to what we do as an international communications and sports marketing business.

‘The increase in profitability in the PR division reflects good cost control, but it is also winning good business and has a strong pipeline.’

Last month, PRWeek broke the news that former LOCOG head of comms Jackie Brock-Doyle is to become CEO of the Good Relations Group later this year.

Satterthwaite added that he expected growth in PR in 2013, pointing to opportunities in CSR and corporate citizenship and the growth of the group’s digital offering. This year, Chime has linked up with Google to train Good Relations staff in the digital giant's creativity, planning and insight tools.

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