Full-year revenues for 2001 will be around 5% less than last year, Cordiant Communications warned on Friday, resulting in “a significant reduction in profitability”. The announcement immediately triggered a 42% fall in the global network’s share price to £0.55 ($0.81; E0.88).
In its statement Cordiant – the sixth largest global agency group and parent of the Bates network – described current trading conditions as the most difficult it had experienced in many years, the ripple effect of the US economic downturn radiating to Europe and the Asia-Pacific region.
The situation had been exacerbated, the group said, by the recent terrorist outrages in New York and Washington DC. This had led to clients’ postponement or cancellation of a number of campaigns and marketing projects.
In the light of the present situation cost targets have been re-evaluated and Cordiant is confident that the broad spread of its business will enable it to benefit on the return of normal market conditions.
News source: Wall Street Journal