Aegis optimistic as it notches up 18% rise in profit

by Daniel Farey-Jones Brand Republic 19-Mar-08, 09:25

LONDON - Media buying and market research group Aegis has reported 17.6% growth in its annual pre-tax profit to £133.5m for 2007 as it outperformed the industry with strong organic growth.

The company, which has been warding off the attentions of its 29.9% shareholder and Havas chairman Vincent Bollore, has increased its dividend by a substantial 21% to 2.3p a share.

Its share price rose 3.4% this morning from yesterday's close of 110p.

The group's media division, comprising agencies Carat and Vizeum, won $1.67bn of net new business last year including the £125m global Mattel account and increased revenues by 13% to £673.4m.

The share of Aegis Media revenues generated by digital marketing network Isobar grew from 20% to 26%.

Aegis' market research arm Synovate increased its revenues by 7.9% to £433m.

The company said Synovate's success was down to a number of factors including its global client relationship programme, product innovation across a number of sectors and growing specialism in industry sectors and areas of research.

Robert Lerwill, chief executive of Aegis, said: "We are cautious about the macro-economic outlook for 2008, but currently relatively optimistic about our own prospects, reflecting the investment we have made in our business and our market positions."

The company outperformed the industry average with organic revenue growth of 9.8% and expects to do so again this year.

"Trading so far this year has been healthy and we currently expect to deliver a further good year in 2008, thanks to a superior product offering, good new-business momentum, the impact of recent acquisitions, our presence in emerging markets and increasing demand for digital expertise."

The decline in global stock markets has knocked Aegis' share price down from as high as 155p in April 2007, leaving it more vulnerable to a bid from cash-rich Bollore.

Last month, Campaign reported Bollore had told his Havas managers to prepare for a takeover of Aegis this year. Bollore had previously made several failed attempts to get two of his candidates onto the Aegis board.