Cello Results 'Better Than Expected'

UK-based marketing services group Cello has announced half-yearly results. Overall group revenues were down 12%, a post-tax loss of £4.2m reflecting the write-down of recent acquisitions, but the Research and Consulting division performed respectably with operating income of £18.2m on turnover of £30m.

Research and Consulting turnover was down from £33.6m in H1 2008 and income down from £20.1m, but Richard Gilmore, Chairman, Cello R&C said that in the light of the economic situation this was 'better than expected, and well in line with, if not better than our peers'. He also pointed to an unusually good performance in the comparison period, H1 2008.

Profits fell from £3.7m the previous year to £2.3m, but most of this was due to a fall in non-research businesses supplying HR/training and competitor/business intelligence, whose value was also written down: actual trading results were better than this suggests. Gilmore reports good performance in the resilient sectors of healthcare and wellbeing, offset by a slight decline in business and margins in UK qualitative research.

Overheads have been reduced, with some reduction in headcount, but Gilmore notes 'I do not take the loss of anyone's job lightly, and most of our savings have been by realignment.' Operating profit in the second half of the year is projected to improve on H2 2008.

Sales at the Tangible subsidiary fell 14% to £28m, while the AIM-listed Group has written off £3.6m of the cost of acquiring MR business SMT Consulting and £0.9m from HR consultancy Chairos Holdings, to reflect lower assessments of their future potential. However, Cello's balance sheet remains strong. '2009 will continue to be a challenging year' according to Chairman Allan Rich, but ''the actions taken in 2008 and 2009 mean that Cello is more focussed, more professionally cohesive, and on a strong financial footing from which to expand in due course.'

Web site: www.cellogroup.co.uk .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

• 2CV
• All news
• MrWeb info