Advertising and PR firm, Chime Communications has reported a sharp fall in profits for the first half of 2003 and there seems little prospect of an improvement in the trading climate.
Interim results issued today show a pre-tax profit of £3.0 million, down from £4.6 million last year. Operating income dropped 14% to £26.9 million.
Chime’s advertising and marketing services business continues to toil with profits down 27% in the six months to June, following a 46% decline in the second half of 2002 and the sale of half of its stake in HHCL to WPP Group (see Chime Communications Sells 49% Of HHCL To WPP). The public relations division performed rather better and now accounts for 63% of the group’s total income.
Lord Bell, chairman of Chime Communications, said that confidence had been tempered by the trying economy and was not disheartened by today’s mixed results.
“We have met expectations and that is very pleasing,” he said. “There is little visibility of growth in our market and conditions are still very testing.”
The company said that the economic outlook is dull, the political climate weak and the consumer is deal conscious and selective. New business continued to improve in terms of number of pitches and the conversion rate but the value of the average win remains depressed.
Nonetheless, existing client relationships are strong and with finances in good order and costs under control, Chime believes that it is positioned to take advantage of an eventual upturn.
Shares in the company were down 4p at 32.25p in late-morning trading.
