Aegis revenue drops 11.6% in Q1 after account losses

by Arif Durrani, mediaweek.co.uk 18-May-09, 11:10

LONDON - Aegis, the communications group behind Carat and Vizeum, has posted an 11.6% drop in organic revenue for the first quarter of 2009, after losing the £650m (billings) Renault account to OMD in EMEA and several other clients in the US last year.

The group, which also includes digital network Isobar and market research specialist Synovate, noted that revenue in the first three months of the year was up 6.5% year on year and remained confident it was "well-positioned" to produce a "resilient performance" for the rest of the year.

The double-digit revenue decline comes despite the French company seeing "a significant exchange rate benefit".

Half of the organic revenue movement at Aegis Media was attributed to Renault and the US losses, but from the second quarter, group revenue will start to benefit from net new business wins of $1.05bn; including Kellogg's, Vodafone and Credit Agricole.

At Synovate, organic gross revenue was down 12%, which the group attributed to a high comparative quarter in 2008.

John Napier, chairman and interim chief executive of Aegis, said the group remained focused on delivering "the cost reduction programme announced in March".

He added: "Our target remains to broadly maintain the full-year underlying operating profit margin through continuing careful management of our businesses."