Huntsworth PR arms sees jump in profit as division returns to growth

Huntsworth saw a 38 per cent surge in operating profit in its PR business in 2019 – which includes Grayling, Red and Citigate Dewe Rogerson – as the division returned to growth.

CEO Paul Taaffe: 'Huntsworth had yet another record year'
CEO Paul Taaffe: 'Huntsworth had yet another record year'

Operating profit in the division grew from £6m to £8.3m. It returned for like-for-like revenue growth for the first time in "several years" – revenue rose 3.3 per cent on a like-for-like basis to £73.6m.

Operating margin in the division, which is called Constellation Communications, moved from 8.2 per cent to 11.3 per cent.

In reference to the division, the company said: "This year saw a pleasing turnaround in performance, following three years of rationalisation, improved sales conversion, cost management and operational efficiencies."

Chairman David Lowden said "standout performances" in Constellation Communications were in Citigate Dewe Rogerson in Asia and Grayling in the UK and Brussels, all of which achieved double-digit revenue growth.

"I’m delighted with the return to growth at our Communications division, Constellation Communications, after many hard years of restructuring and re-focusing. The division is comprised of many smaller agencies across the globe all of whom have contributed to the turnaround."

The division accounted for 17 per cent of operating profits before central costs in the year.

The company this morning announced "another record financial performance" across the business.

Pre-tax profit rose 27 per cent to £39.1m on revenue that was up 18 per cent to £264.9m. The firm proposed increasing its final dividend to 1.85p, giving a total dividend for the year of 2.6p, up 13 per cent on 2018.

The growth includes two acquisitions in the year: Kyne and Creativ-Ceutical in its Marketing and Medical divisions.

Like-for-like revenue growth was led by the Medical arm (+8.5 per cent to £45.1m). Growth was 5.8 per cent in the Immersive division (£37.9m), and 2.4 per cent in its biggest division, Marketing (£108.3m).

The company said it invested around £4m in the year to "improve and expand the property portfolio and talent to manage a rapidly growing business".

CEO Paul Taaffe said: “Huntsworth had yet another record year led by growth in our Medical and Immersive divisions and a return to growth in Communications. Organic revenue growth accelerated over the course of the year and the acquisitions of Kyne in Marketing and Creativ-Ceutical in Medical both contributed to 2019 performance and further enhanced our capability to attract larger and higher-margin client engagements.

"We have entered 2020 well positioned for another year of growth with strong momentum at the start of the financial year and an increased new business pipeline.”

Huntsworth incurred a £3.6m expense from last July's sale of Grayling's MEA division via a management buyout, the announcement states.

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