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First Half Results from Observer
Swedish-based business intelligence group Observer AB has published its Interim report for the first 6 months of 2004, showing strong development in North America and continued tough market conditions in the Nordic region.
Observer has around 2,400 employees and had a turnover of SEK 1.5 billion in 2003. The company operates in the US, UK, Sweden, Canada, Germany, Norway, Finland, Denmark, Portugal, Ireland, Estonia, Latvia and Lithuania.
Operating revenue amounted to SEK 811.4 million (comparable figure for 2003 781.6m). Exchange rate effects from the translation to Swedish krona affected revenue negatively by SEK 22.4 million compared with the corresponding period of 2003. Organic growth in local currency was -1% (broken down into -12% Nordic region, +2% rest of Europe, +12% North America). For the corresponding period in 2003 the overall organic growth amounted to -5%.
Excluding goodwill amortization and items affecting comparability, operating profit (EBITA) amounted to SEK 100.3 million (112.1 in 2003) while profit per share after dilution was SEK 0.85 (1.08). Exchange rate effects affected profit negatively by SEK 4.5 million compared with the year-on-year period. The operating margin was 12.4% (14.3%).
The loss after financial items amounted to SEK -3.6 million (-10.6), and the net loss for the period was SEK -21.9 million (-25.5). Operating cash flow amounted to SEK 115.5 million (137.3).
CEO Robert Lundberg says the second quarter is normally the group's weakest. 'As expected, the Nordic market remained tough, while growth and operating margins in North America are still strong'. Observer acquired MediaClips, a radio and TV monitoring company in California in April, and now monitors all the largest US broadcast media markets, the three most significant of which are New York, Chicago and Los Angeles.
The Nordic market shows some more positive signs but is expected to take a while before showing significant improvement, with new management in place. Growth in the rest of Europe was positive. Current changeover to new digital technology in the UK affected margins and will continue to do so in the third quarter, but will allow the introduction of a number of new services during the second half of the year.
The full report is available at www.waymaker.net/bitonline/2004/08/05/20040805BIT20170/wkr0001.pdf
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