(Alliance News) - M&C Saatchi PLC on Wednesday posted a diminished profit for the first half of 2022 despite growing revenue as rising expenses and transaction costs hit.
Pretax profit in the six months to June 30 fell to GBP305,000 from GBP4.8 million.
M&C Saatchi shares were 4.1% lower at 155.52 pence each in London on Wednesday morning.
The London-based advertising agency said takeover transaction costs were at GBP9.3 million. In the last few months, M&C has found itself in a takeover battle between Next Fifteen Communications Group PLC, and its largest shareholder AdvancedAdvT Ltd.
Further, project costs widened by 74% to GBP92.3 million from GBP53.2 million. Staff costs increased by 10% to GBP94.4 million from GBP85.5 million.
On a headline basis, however, pretax profit rose 52% to GBP16.0 million to GBP10.5 million a year prior.
Revenue grew 30% to GBP221.7 million from GBP171.2 million a year prior. Excluding revenue from entities that became subsidiaries in 2021, net revenue grew 9.6% to GBP129.4 million from GBP126.5 million.
The firm intends to reinstate dividends for 2022, reiterating what it said in April. The last time it issued a dividend was for the first half of 2019.
"Despite deteriorating macroeconomic conditions, the diversity of our capabilities, the strength of our counter-cyclical businesses, our geographic breadth, and our unique proposition of meaningful change provides resilience," M&C Saatchi stated.
M&C Saatchi was founded in 1995 by ad executives Charles Saatchi and brother Maurice Saatchi, who also were behind renowned ad agency Saatchi & Saatchi.
By Tom Budszus; tombudszus@alliancenews.com
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