Top 150 - 2005: The SEC legacy

Willott Kingston Smith's Esther Carder once again searched Companies. House for the latest information on some of the biggest agencies unable to enter Top 150.

For the third year running, the Sarbanes Oxley Act has prevented some of the larger PR agencies, which are members of international groups, from submitting figures for the Top 150 tables. As the tables do not provide a complete picture, we have, once again, put together a table detailing the most recently available financial information for the companies unable to submit figures.

The information in the table has been obtained from the latest set of financial statements filed at Companies House. Although more historic than the figures provided in the main top 150 table, it nevertheless gives a better understanding of the industry. We've grouped together the results of subsidiaries for ease of reference, and made no adjustments for inter-company trade or non-UK income, as we did not have sufficient information to determine this.

Unfortunately, no financial information was available for the following companies: Burston Marsteller, Cohn & Wolfe, Manning Selvage & Lee and Ogilvy. All of these operate as divisions.

If we take a look at the latest financial information available for the groups that head up these consultancies (obtained from their websites), we are provided with a more up-to-date overview of 2004.

Havas, as a group, has seen margins improve from 8.3 per cent in 2003 to 13.2 per cent in 2004 and 14.2 per cent in the second half of 2004.

Unfortunately, no sector breakdown is given.

Elsewhere, Interpublic reported that overall revenues were up by 6.3 per cent in its third quarter 2004 interim results, compared to the same quarter in 2002. But this figure was not split between disciplines.

Omnicom reported a 12 per cent growth in its PR revenue in 2004 compared to 2003, with PR representing 13.1 per cent (up by two per cent from 2003) of the total revenue of the group in 2004. For the fourth quarter of 2004, PR showed growth of 15.7 per cent.

WPP's 2004 results revealed PR and public affairs revenue increases of 6.5 per cent compared to 2003, now comprising 10.4 per cent of group revenues. Operating profits have also risen by more than one per cent to an increase of 14 per cent, against increased group-wide revenues of five per cent and group-wide margins of 14.1 per cent.

While PR agencies still face difficult market conditions, they have certainly fared better in 2004 both in terms of increased income and, more importantly, seen improved margins. The outlook for the coming year remains uncertain, but the general consensus is that the market is set to continue to improve, albeit slowly. Consultancies must, therefore, continue to be very cautious before they allow their cost base to increase in the face of upturns in income.

AGENCIES NOT INCLUDED IN TOP 150 TABLE

GROUP NAME/ YEAR GROSS TURNOVER STAFF EMPLOY-

COMPANY NAME END INCOME COSTS EES

(pounds) (pounds) (pounds)

The Band and Brown Group

The Band and Brown Grp 31/7/04 5,531,380 6,940,486 3,030,599 77

Euro RSCG Biss Lancaster

Euro RSCG Biss

Lancaster 31/12/03 5,314,358 8,779,825 2,868,807 67

The Maitland

Consultancy*(1) 31/12/03 5,860,304 6,740,274 2,912,680 34

CGI Brandsense 31/12/03 2,895,541 4,300,008 1,504,173 33

14,070,203 19,820,107 7,285,660 134

Pleon UK formerly

Brodeur Worldwide

Pleon UK formerly 31/12/03 2,431,205 3,807,572 1,870,260 30

Brodeur Worldwide*(1)

Buchanan Communications

Buchanan Comms 31/12/03 5,067,481 5,772,065 2,720,717 34

Porter Novelli formerly

Countrywide Porter

Novelli

Porter Novelli Limited 31/12/03 11,447,519 14,631,686 7,069,599 137

formerly Countrywide

Porter Novelli

Financial Dynamics

Financial Dynmics*(1) 31/12/03 18,637,000 21,078,000 12,157,000 132

FD International 31/12/03 - - 454,000 5

18,637,000 21,078,000 12,611,000 137

Fishburn Hedges

Fishburn Hedges

Boys Williams*(1) 31/12/03 11,365,927 15,243,875 6,632,948 97

Golin Harris

International

formerly Weber

Europe*(1)

Golin Harris

International 31/12/03 2,768,000 4,742,000 1,347,000 34

Weber Europe formerly 31/12/03 1,686,000 1,946,000 881,000 19

Golin/Harris

International*(3)

4,454,000 6,688,000 2,228,000 53

GCI/APCO

GCI London 30/9/03 5,434,902 8,962,446 3,173,188 80

GCI Financial Group*(4) 30/9/03 303,345 440,121 241,223 3

GCI Healthcare 30/9/03 1,159,807 1,733,142 565,828 15

APCO UK 30/9/03 3,164,719 4,028,949 1,955,725 36

10,062,773 15,164,658 5,935,964 134

Harrison Cowley

Harrison Cowley*(1) 31/12/03 5,114,325 5,830,311 2,973,333 89

Hill & Knowlton

Hill & Knowlton*(1) 31/12/03 22,306,000 33,557,000 12,200,000 262

Ketchum

Ketchum 31/12/03 12,777,036 23,498,142 6,517,755 132

Staniforth

Communications

Staniforth formerly

TCG 31/12/03 3,460,982 5,615,733 1,820,639 51

The Shire Health Group

Shire Health Grp*(2) 31/12/03 412,100 - - 0

Shire Health London 31/12/03 2,116,346 2,707,159 1,715,350 44

Shire Health

International 31/12/03 3,562,722 5,365,197 1,066,425 28

6,091,168 8,072,356 2,781,775 72

Weber Shandwick

Weber Shandwick 31/12/03 15,335,000 26,178,000 11,126,000 255

Acclaro

International*(5) 31/12/03 21,000 32,000 - -

Weber Shandwick

Technology formerly 31/12/03 2,912,127 4,140,175 1,629,812 30

Miller/Shandwick

Technologies*(1)

18,268,127 30,350,175 12,755,812 285

*(1) The figures include turnover and gross income from outside the UK,

which is not usually included in the PR Week figures *(2) This is a

holding company *(3) On 1 January 2004, all of the assets and

liabilities of Weber Europe formerly known as Golin Harris

International, another group company, were transferred to the company at

net book value *(4) The company ceased to trade with effect from 30

April 2003 *(5) The company lost its only contract at the beginning of

the year and thereafter ceased to trade.

Fleishman-Hillard is not included owing to a change in year end. All the

figures have been obtained from the latest accounts filed at Companies

House. The staff costs are total staff costs per the accounts, including

pension and social security costs. We have only included the trading

companies in the table.

- Ketchum increased its gross income by more than £1.5m in 2004 compared to 2003's Companies House figures

- Hill & Knowlton added nearly £4m to its turnover in 2004

- WPP saw a 6.5 per cent increase in PR and public affairs revenue over the previous year

- PR represented 13.1 per cent of Omnicom's total group revenue in 2004

AGENCIES WITH NO FIGURES AVAILABLE

Group name Reasons for not including figures

Burson-Marsteller Ultimate parent company is WPP - no individual

figures available

Cohn & Wolfe Ultimate parent company is WPP - no individual

figures available

Manning Selvage & Lee Ultimate parent company is Publicis - no

individual figures available

Ogilvy Ultimate parent company is WPP - no individual

figures available

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