PROFILE: Richard Nichols, Incepta - Numbers add up as Nichols tops Incepta. Ex-finance chief Richard Nichols brings a non-PR skillset to CEO role

With no hands-on experience of public relations, Richard Nichols

finds himself in charge of a swathe of PROs. He has never drafted a

press release, does not advise on message development and has never

knowingly spun a journalist a line. Despite this, he controls the

destiny of almost 2,000 PR and marketing services staff.



Nichols took over this week as chief executive of Incepta, the quoted

company which owns the Citigate brands and, after a further step on the

company's recent acquisition spree, The Red Consultancy. A former

British Gas and Price Waterhouse accountant, he joined Citigate

Communications as deputy group finance director five years ago. Since

then he has seen the company move from being a fledgling operation to

the FTSE 250.



'I don't advise clients. I bring a different skillset to the party,'

Nichols says, when questioned on how a bean counter can plausibly lead a

huge creative corporation. Nichols insists he is more than a number

cruncher, adding that to reach the top finance post in any organisation

requires 'an understanding of operations, the marketplace and the way

the business works,' as well as an ability to do the sums.



If Nichols' reputation in the City is anything to go by, he has this

understanding. Beeson Gregory analyst Hector Forsythe says there is no

need for Incepta shareholders to be concerned by the change at the top,

which has seen chairman Bob Morton leave the group and ex-CEO David

Wright take an executive chairman role. 'Nichols has had five years of

experience around the group and the company's core PR businesses are

going like trains,' Forsythe says .



Forsythe is happy to overlook the fact that Nichols has no PR

experience.



It should, he insists, be considered an asset: 'This is a people-centred

business and it is appropriate that there isn't interference in client

work from on high. He can oil the wheels and get the units working for

each other but does not need his own client portfolio.'



Like any CEO, Nichols will take the plaudits for delivering value and

the flak if he fails. Incepta is a curious beast in this respect. It was

placed at the top of a recent Sunday Times list of 'unloved shares'.



By this the paper meant the company - which has been growing fast ever

since the then Citigate Communications pulled off a reverse takeover of

the Incepta shell in 1996 - was a grossly undervalued equity. It has

delivered profits greater than the previous year, enjoyed strong

management and enviable clients, yet its market worth is below what its

earnings per share would suggest. Turning that around is the key task

for Nichols.



Another will be to consolidate Incepta's recent buys and find further

acquisitions. Any suggestion of an end to predecessor David Wright's

spending blitz - he acquired Sard Verbinnen and Cunningham

Communications in the US, Key Communications and the Red Consultancy in

the UK and a batch of ad agencies and online interests in the last two

years - is met with a firm 'no'.



'We are still on the acquisition trail,' he says. 'We have a lot of

excellent businesses but as well as growing organically within units, we

want to grow acquisitionally from the centre.'



This entrepreneurial attitude fills everything Citigate does, he says,

and stems from the fact that the company is in large part-owned by the

people who work for it. A quarter of the company is owned by 40 per cent

of staff, a state of affairs bolstered by the recent Red deal, which

could give every Red employee a stake in the new parent.



Nichols has identified the US and continental Europe as areas where the

company has a lower market share than it is capable of securing, given

its success in such trades as financial PR. 'We want to build presence

in Europe and feel we are under-represented in the US market,' he

says.



This, despite buying respected tech-PR firm Cunningham

Communications.



Medium-sized agencies from Warsaw to Wisconsin would be advised to

prepare for due diligence.



Incepta shareholders can look forward to a fruitful future, principally

because unprofitable businesses will be hacked off by Nichols and

Wright, who is still deeply involved in major decisions in his role as

executive chairman.



The Cunningham experience - the market slowed after acquisition, leading

the London management to cut staff costs - has proved Nichols'

ruthlessness but it has not deterred his will to buy: 'In the same

situation I would make the same acquisition again, for the same

price.'



In years to come, we can judge Nichols on three things, he says. If the

company's units are the best in their respective classes, with the best

staff servicing the best clients. The City is likely to use a more

precise measure and judge him on earnings and the Incepta share price.

He seems unlikely to disappoint.



HIGHLIGHTS



1994: Senior financial analyst, British Gas



1996: Deputy finance director, Citigate Communications Group



1999: Group finance director, Incepta



2001: CEO, Incepta.



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