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Synovate Continues Strong Growth
Synovate parent Aegis Plc has announced impressive half year results to 30th June 2006, with both research and media businesses strong contributors. Synovate saw worldwide revenue up 25.9%, with rapid expansion in EMEA (excluding Western Europe) and in Asia Pacific.
Overall, Aegis reported organic revenue growth of 7.2%, underlying pre-tax profit up 8.9% to £38.0m and record net new business of $1.3bn. CEO Robert Lerwill says both Aegis Media and Synovate have 'delivered strong organic revenue growth, once again ahead of their markets'.
The Synovate growth comes despite a strong comparative first half 2005, when 'an unusually large number of contracts were completed'. This effect is particularly noticeable in the small growth figure for the Americas below – although this also reflects economic uncertainty.
Synovate Revenue, first half 2006 (vs first half 2005)
[table]
Gross profit grew by 27.6% to £118.5m from £92.9m, with organic revenue growth of 7.5%. Operating profit was up 13.6% to £7.5m, but operating margin down 50bps due to the phasing of contract completions, less favourable than that for H1 2005 as above. Orders on hand are up 13% versus the same time last year, and the company expects margin for the full year to show good growth.
Results for the EMEA region continued the pattern of 2005, with weaker (western) European markets offset by strong demand in C&E Europe, the Middle East and Africa. Synovate is a top 3 player in China, and here and in India there was very strong growth.
Globally, the company said it had notable success with larger contracts and key clients, winning preferred supplier status in a large number of cases.
Reported earnings per share were up 27.3% from 2.2p to 2.8p, and underlying up 10% from 2.0p to 2.2p. The proposed dividend is up 11.5% year on year to 0.725p.
Synovate is online at www.synovate.com .
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