Strong Results for Chime as it Buys Sports Group

UK marketing services group Chime Communications has released preliminary results for the year ended 31 Dec 2006, with organic growth of 11%; and has simultaneously announced the proposed acquisition of sports marketing agency Fast Track Sales Limited.

Chime is the holding company for a number of PR, marketing services and research consultancy firms. Overall the group reported operating income up 25% to £78.8m with operating profit up 47% to £12.3m. Profit before tax was up 51% to £11.1m, and earnings per share up 24% to 3.08p. The group reversed its cash situation, from net debt of £3.0 million at 31st December 2005 to net cash of £2.9m a year later.

Chairman Lord Bell says the company 'has made considerable progress across all its divisions with double digit growth in all the key indicators' and that growth is continuing in 2007. The research division, which includes Opinion Leader Research, Ledbury and Facts International, accounts for just 6% of the group's operating income and 8% of its operating profit, but is the most profitable part of the group, with a 2006 profit margin of 21.7%, up from 19.1% in 2005. Research operating income for 2006 increased by 31% to £4.7 million and operating profit increased by 48% to £1.0 million. (NB figures for 2005 are after restructuring costs).


Fast Track was founded in 1998 by former Olympians Alan Pascoe, Edward Leask and Jon Ridgeon and has a team of more than 80 people creating sponsorship programmes and events for clients across a multitude of sports.

Assuming the deal passes the usual hurdles, Chime will pay an initial consideration of £10m in cash and £5m in shares, and a maximum total consideration (initial and deferred) of £43m for Fast Track and its subsidiaries. The deferred amount is payable on average profits for the three years ended 31st December 2009 and the three years ended 31st December 2012. As a result of the acquisition, Chime has increased its borrowing facility to £25 million. This is a three-year facility, maturing in February 2010.

The Fast Track Group reported pretax profits (under UK GAAP) for the year to 31st December 2006 of £371,000 and gross assets on that date of £6.6m. The four principal shareholders and directors of the company - the founders plus Jim Glover - remain in place and have warranted pretax profits for the year to 31st December 2007 of £2.5 million.

Chairman Alan Pascoe comments: 'In nine years, Fast Track has established itself as the leading sponsorship and events agency in the UK, recently winning five industry awards... This is a huge opportunity to enable our staff and clients to benefit from a broader range of marketing service skills... This is an exciting time for our client's partnership programmes within all sports as we continue the countdown to the London Olympic and Paralympic Games in 2012 and the legacy beyond.'

Chime is online at www.chime.plc.uk , Fast Track at www.fasttrackagency.com .

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