Havas first-half profits fall 38% despite rise in revenue
LONDON - Havas has reported a 38% fall in profits to €21m (£14.2m) during the first half of this year, compared with €34m during the first half of 2005.
Profits plummeted, despite the network recording a 2.8% boost in its revenues to €719m, up from €700m during the first half of 2005.
The group, which owns creative agencies Euro RSCG Worldwide and Arnold Worldwide Partners along with global media network Media Planning Group, recorded new-business wins of €900m for the first half of the year compared with €500m during the first half of 2005.
The total included creative account wins for pan-European duties on Disneyland Paris, and the media business for De Agostini publishers in the UK and computer games company Eidos, which makes the Lara Croft 'Tomb Raider' games, in the UK, France and Germany.
Fernando Rodes Vila, chief executive of Havas, said: "The group continues firm in its strategy of investing in creativity and quality by bringing in new talents to serve its clients. Senior executives of the Havas Group are focusing on these two factors to drive organic growth on a sustainable basis, while giving the fullest consideration to the needs and expectations of all the group's clients and partners.
"This is a strategy that can only be implemented over time and its effects, while already perceptible, will become increasingly apparent in the future."
Speaking at a news conference, Rodes Vila added: "We are where we wanted to be for the first-half... even if we are not proud of these results."
He added: "This team works with a 2008 horizon. In 2007, we will have a profitability level above that of 2006 with a two-year target of coming close to our rivals."
By the end of 2006, Rodes Vila says he expects operating income to be double that of the first half and revenue to be "a little above" double that of the first half.
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