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TNS Points to Recovery for US Custom
TNS has issued a trading update, ahead of reporting interim results on 3 September. The group says its previously troubled US custom business has returned to growth and expects underlying organic revenue growth of over 5% for the first six months of 2007.
The global no.2 agency says the organic growth figure will be offset to the tune of around 4% by the impact of foreign exchange, but that net acquisitions and disposals will add around 1.5%.
The firm said it was making 'encouraging progress' in rebuilding US custom, with 'good levels of new business contributing to revenue growth in the first half'. In the full year 2006 underlying revenue in the Americas declined by 4.7% with the underperformance of US custom the key factor - however in March (www.mrweb.com/drno/news6518.htm ), TNS was optimistic about this side of the business, pointing out that US custom 'met revised expectations' in the second half with the new management team said to be making good progress - these comments appear to be borne out by the interim update.
Today's announcement says Europe as a whole achieved good underlying growth, with a strong first half for the UK, while France and the Rest of Europe are described as performing 'steadily' in H1 2007. This is also a turnaround - in 2006 the UK along with Germany was described as 'softer' than other parts of Europe.
The company's 'ALM' super-region (Asia Pacific, Latin America, Middle East and Africa) continued to perform well in the first half and double digit revenue growth is expected for the year.
In terms of vertical markets, consumer and technology sectors are said to be particularly strong.
Since the share buy back programme started in September 2006, the group has spent £59.9m on repurchasing its own shares - this is expected to rise to £100.0m in total by the end of the year.
The group is online at www.tns-global.com.
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