Cordiant Posts 78% Profits Increase; Invites Offers

09 March 2001

London-headquartered Cordiant Communications, number ten in the global advertising league, yesterday unveiled a 78% per cent hike in pre-tax profits to £57.5m for the year to December 31.

Thirty five per cent of group revenues accrued from North America, said chief executive Michael Bungey - but he stressed that two-thirds of these came from marketing services, not advertising, rendering Cordiant less exposed than other groups to the advertising slowdown.

According to Bungey, the group’s winning performance was boosted by acquisitions and new business wins. He also sent a clear signal that Cordiant was open to takeover offers, advising rivals to hasten before the price rose.

"We have a very good-shaped business strategically and we are very strong financially, so that would make us interesting to a number of people," he said. As the ad industry consolidated, Cordiant was becoming "a rarer commodity". Concomitant with rarity was price, which, Bungey observed, tends to move “only in one direction”.

Interpublic and Havas Advertising are seen by industry observers as the most likely contenders, both for Cordiant and True North – the only surviving independent world networks.

Bungey also revealed that senior managers at Cordiant have qualified for share options valued at over £60 million following the successful completion of the group’s first big incentive scheme.

News sources: Financial Times; The Times (London)