CLL.L Share News (CLL)

First half numbers from marketing group Cello were music to the ears of shareholders on Tuesday morning as the group unveiled a robust performance. Revenue grew 2.3% from £61.5m to £62.9m on a like-for-like basis, while gross profit increased to £30.5m (2010 H1: £29.9m). Headline profit before tax, which excludes exceptional charges and acquisition related costs, rose 7.7% to £3.1m from £2.8m the year before. Reported profit before tax fell to £2.2m from £2.6m in the first half of 2010.Headline basic earnings per share dipped to 3.01p from 3.48p last year. The decline was in line with expectations and has been influenced by the increase in the number of shares following settlement of earn out liabilities in 2010 and 2011.Net debt at the end of June had come down to £11.2m from £11.7m a year earlier, despite £2.2m of cash and loan note payments made under earn out arrangements in May 2011. Provisions for future earn outs continued to reduce and are now £3.3m (December 2010: £7.3m). This total is expected to be settled through a combination of cash and shares, payable between 2012 and 2014.The increase in underlying profit led the group to raise its dividend, but this was a cautious 5% from 0.525p to 0.55p as it kept its eye on projects in the pipeline for the second half. Chief executive Mark Scott said: "Cello is benefiting from its focus on servicing the pharmaceutical sector, along with other high margin client sectors, on an international basis. This focus has been enhanced by the recent acquisition of MedErgy. "The group has a powerful combination of online data gathering, advisory capability, and the ability to help clients implement their global marketing strategies. This is a good basis for continued growth and we are confident that management expectations for 2011 will be met."Expansion has continued, particularly in the USA and Asia, with international work accounting for more than 50% of the group's research and consulting activity. Cello's research and consulting revenues decreased by 1.3% to £31.0m (2010: £31.4m), with gross profit up 6.0% to £19.6m (2010: £18.5m). Like-for-like gross profit grew at 2.8%.The group's Tangible division saw a slowdown of public sector work, but this was more than compensated for by a number of new client wins across a range of client sectors. "Whilst it is clear that the current economic backdrop remains challenging, the group has a robust pipeline of opportunities and booked work for the second half of the year, leaving it well positioned for growth," the company added. The shares rose 4.25p to 35.00p on the results.NR