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Huntsworth grows profits despite declining revenues
Public relations and integrated healthcare communications firm Huntsworth saw operating profits grow across its subsidiaries in 2017 despite declining revenues in what it referred to as a year of "strong progress".
Huntsworth's communications arm, made up of Grayling, Red and Citigate Dewe Rogerson, posted an operating profit of £7m, up from the £5.5m it posted in 2016, marking a like-for-like rise of 24% for the twelve months leading to 31 December.
Revenue in the communications wing fell 7% to £77.6m.
Grayling turned an operating loss of £800,000 in 2016 into an operating profit of £1.1m in 2017 after shutting down unprofitable business units over the last 24 months, saying it had "responded well to the prior year restructuring" with a "particularly strong rebound in performance" in the UK.
However, like-for-like revenue at Grayling fell 11% £40.5m.
Huntsworth's consumer agency Red reported a "good year", with revenue and operating profit moving ahead 3% and 4%, respectively, despite a challenging marketplace and client churn "largely driven by procurement-led tenders".
"The agency won a number of significant new mandates, and we anticipate little net effect on trading in 2018," Hunstworth said on Tuesday.
Operating profit at its financial agency Citigate Dewe Rogerson (CDR) was mostly flat, down from £3.6m to £3.5m, as was revenue, up from £22.1m to £22.2m.
Huntsworth said Citigate "performed solidly" despite its "mixed performance", after a "strong performance in the Netherlands offset by a weaker UK performance".
"A quieter Asian market impacted the Greater China business early in the year, however, all CDR operations benefited from an improving market towards the end of the year," the firm told investors.
Overall, Huntsworth's pre-tax profit rose 52% to £24.4m, when excluding acquisition and restructuring costs, and revenue rose 9% to £197m, reflecting a "combination of strong growth from the three Healthcare divisions, the impact of a favourable move in exchange rates and Grayling's return to profitability".
Chief executive Paul Taaffe, said, "Huntsworth made strong progress in 2017, led by its Healthcare agencies. Our focus is to better serve our Healthcare clients by developing and adding capability to the group, and with a strengthening balance sheet, we are well placed to continue to do so. Despite increasing FX headwinds, the year has started well with good trading momentum and Huntsworth is well positioned for further growth in 2018."
As of 1215 GMT, shares had grown 3.35% to 80.20p.