Next 15 performance improves in Q3 as US achieves 'modest' organic growth

Next 15 says it continued to perform "ahead of management expectations" in the three months to 31 October. Organic revenue decline narrowed to three per cent in Q3, versus a 6.6 per cent dip in the first half.

Next 15 chief executive Tim Dyson
Next 15 chief executive Tim Dyson

Next 15's overall revenue in the third quarter was about seven per cent higher than in the same period last year, and there was "strong growth" in operating profit margin.

In its Q3 trading update today, the group said its performance was again led by its b2b tech-focused agencies, such as Activate, Twogether and Agent3. But it also noted a "welcome recovery" in its b2c agencies – highlighting Savanta and PR shop MBooth.

Next 15 – which also owns PR agencies Archetype, The Outcast Agency, The Brandwidth Group and Publitek – said its US revenues returned to "modest organic growth" in the quarter, which contributed to the narrowing decline in organic revenue.

The group stated: "We remain cautiously optimistic about trading as we enter the final quarter of our financial year and will continue to manage our cost base with care in what is still a highly uncertain general economic environment.

"The group is highly cash generative and has a strong balance sheet, with net debt as at 16 November, after recent acquisition-related payments, of less than £1m."

It reiterated its previously stated expectation that it would perform ahead of current market expectations in its current financial year, which ends on 31 January 2021.

At its half-year results announcement in September, Next 15 said it was "actively marketing" about one-third of its real estate in London, New York and San Francisco after deeming it "surplus to requirements" amid the shift to more home working.

Earlier this month, Next 15 agency Archetype announced it had acquired independent London-based firm Marlin PR, and plans to merge the two entities next year.

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