Huntsworth sees improving conditions after 2009 revenue drop

PR group Huntsworth reported falls in pre-tax profit and revenues during 2009, but is seeing evidence of a market 'recovery trend'.

Lord Chadlington: Huntsworth chief executive
Lord Chadlington: Huntsworth chief executive

The group, which owns Grayling, Red and Citigate Dewe Rogerson, saw organic revenue drop by 4.7 per cent during 2009. Annual revenue fell to £156.3m druing the year from £159.1m in 2008.

Profit before tax fell marginally to £23.4m from £24m the previous year, while net debt increased to £49m from £33.5m.

Peter Chadlington, chief executive of Huntsworth, said: ‘During the height of the global financial crisis, profit before tax and basic earnings per share were broadly in line with our previous record results in 2008. The group has also continued to deliver operating margins of over 20 per cent which is clear evidence of the strength and flexibility of our model.'

The Huntsworth board will propose a final dividend of 2.15p per share, providing an increased total dividend of 2.90p - up 7.4 per cent on 2008.

The group said in its last interim statement that market conditions were significantly better than at the start of 2009 and today noted that this trend was continuing.

Chadlington stated: ‘With net new business wins up 108 per cent in January on the previous year and a strong final quarter to 2009, we believe this recovery trend has continued and that the Huntsworth portfolio is well placed to benefit from it. As the early results of our growth initiatives are beginning to show, we look forward to another successful year.'

The results were broadly in line with analysts' expectations. In a note this morning Numis said it was maintaining 2010 forecasts for the firm, but that there was ‘clear scope to upgrade as we progress through the year' and that Huntsworth remained ‘materially undervalued'.

Analysts at KBC Peel Hunt also said that, if the strong trading conditions of the fourth quarter and January continued, there ‘will be room for upgrades' on its forecasts.

Huntsworth also announced a restructure of its City PR brand Citigate, including its chief executive Jonathan Clare stepping down from day-to-day running of the agency.

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