Highbury sniffs upturn after £9m profit
Article Date: Mar 22 2002Consumer and business publishing group Highbury House Communications is 'cautiously optimistic' about an upswing in the advertising cycle after a 'difficult' 2001 in which pre-tax profits rose 10 per cent to £9 million before exceptionals, writes Robert Tyerman.
Highbury's (HHO) executive chairman Ian Fletcher says like-for-like profits last year fell by 10 per cent, as the business advertising market weakened and only the addition of acquisitions made at a cost of £6.5 million, led to any profits increase at all being shown. This expansion helped push group revenues up 29 per cent to £100 million.
Revenues in Highbury's business publishing division were swollen by an acquisition from the Reed group and profits benefited from significant staff cuts. Margins were squeezed in consumer publications, where, says Fletcher, 'management under-performed'.
He argues that advertising spending overall bottomed out in the last quarter of 2001, with 'healthy' figures for January 2002. Highbury has budgeted for flat revenues in the current year and so any uplift will come as a bonus.
Fletcher now says 'the economy has reached bottom, the ad cycle has turned and I am cautiously optimistic'. He does not quarrel with analysts' profits forecasts of £10 million pre-tax for 2002.
Highbury shares, which approached 80p two years ago, perked up 3.25p on the results to 27p.
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