LONDON (Alliance News) - Marketing firm Cello Group PLC Thursday expressed confidence for its current financial year, and said its profits and revenues for 2014 were in line with consensus market expectations.
The company said that, following discussions with HM Revenue & Customs, The Direct Marketing Association and the Charity Tax Group, it has emerged that one of its subsidiaries may not have been charging value-added tax on certain items to its charity clients appropriately.
It said that any backdated VAT assessment would be substantially recoverable from clients, and it currently estimates a maximum potential liability before recovery of between GBP1 million and GBP2 million. Cello Group intends to "robustly defend its historical position" on the issue.
Cello said its Cello Health segment produced double-digit revenue growth in 2014, with operating margins maintained at 20%. The business secured a "strong new business pipeline" for 2015 in the final quarter of 2014, Cello said.
It said its Cello Signal segment produced full-year revenue growth against a tough comparative figure in 2013. The segment incurred a GBP500,000 restructuring charge during the period as it continues to transition towards technology services.
Cello said it expects to announce its full-year results March 19.
Shares in Cello are trading down 5.8% at 90.00 pence Thursday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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