NAIROBI, Aug 29 (Reuters) - Kenya's biggest marketing firmScangroup registered an 83 percent drop in pretaxprofit for the first six months of 2013, hurt by a decision toshrink its operations in Nigeria.
Scangroup, the only listed marketing and advertising companyon the Kenyan bourse, said on Thursday its pretax profit fell to101 million shillings ($1.2 million), hit by a 91 millionshilling loss in Scanad Nigeria.
The firm met headwinds when it launched its Nigerian outletlast year, after Nigeria's Prima Garnet Communications sued itand Ogilvy Africa for breach of contract and colluding to lockout smaller competitors.
"Whilst we await a decision, we have taken action in thefirst half to down size the operations to minimise the costs,"Scangroup said in a statement.
Scangroup's main shareholder, WPP, said earlier inAugust it planned to raise its stake in the company to 50.1percent, from 33.62 percent through the purchase of additionalshares.
WPP is set to be overtaken as the world's biggest ad groupby the merger of Publicis and Omnicom.
Scangroup, which also operates in Tanzania and Uganda, saidits advertising revenue dipped 4 percent to 1.8 billionshillings, but said it expected to recover in the second half.
"We expect to regain the lost ground in terms of revenue andanticipate that the operating profit in 2013 ... will be atsimilar level as 2012, with the exception of Nigerianoperations," the company said.
Its share price was down 1.4 percent to 68.50 shillings by0728 GMT.