Profits at Chime Communications have tumbled after what the agency group called a “very poor” year.
UK-based Chime reported a slump in pre-tax profits from £16.3 million ($25.5m; €24m) in 2001 to £7m. Operating profits sank 52.5% to £8.4m.
“After eight very successful years, we have had a very poor year with operating profits down by 50%,” commented chairman Lord Tim Bell. “Our market has been in reverse for 18 months and the effect has been very marked.”
Profits at its advertising division – recently shorn of WPP-bound HHCL & Partners [WAMN: 16-Jan-03] – collapsed from £7.3m to £2.7m, while its public relations business dropped from £7m to £3.7m.
However, the group has agreed a new three-year agreement with the Royal Bank of Scotland while it waits for the ad recovery – an upturn it does not consider imminent.
Continued former Thatcher favourite Bell: “The first quarter of 2003 appears to be no worse than the last quarter of 2002 and we think this may be an indication that the declines in operating income … have now stopped. However, there are no signs so far that anything is getting much better.”
Data sourced from: BrandRepublic (UK); additional content by WARC staff