CHW.L Regulatory News (CHW)

9 May 2012



CHIME COMMUNICATIONS PLC

ANNUAL GENERAL MEETING AND INTERIM MANAGEMENT STATEMENT

Chime Communications PLC, a leading marketing services group, today announces its Interim Management Statement relating to the period from 1st January 2012 to 9th May 2012 (as required by the UK Listing Authority's Disclosure and Transparency rules) ahead of its Annual General Meeting ("AGM") today.

Lord Bell, Chairman of Chime said:

"Trading during the year so far has been satisfactory within the Sports Marketing, Advertising, Research and Healthcare businesses, but we are forecasting a decline in revenue and profits in the Public Relations business which will affect the full year results. Given the profit decline in Public Relations and a rebalancing of Sports Marketing profits caused by the Olympics, group profits will be second half weighted."

The Group is pursuing a transition strategy from being a diversified group with an emphasis on public relations to being a communications and sports marketing business. Additionally, the Group is continuing to invest in sports marketing, healthcare and digital communications. These are all areas the Board believes have strong growth potential in the coming years.

In support of that strategy, the Group announced on 7th March 2012 that discussions were continuing on the potential management buyout ("MBO") of part of the Public Relations Division which represents less than 10% of Group profit.

Significant progress has been made on this potential buyout with the main terms being agreed involving the following businesses: Bell Pottinger Sans Frontières, Bell Pottinger Public Relations, Bell Pottinger Middle East, Bell Pottinger Public Affairs, Chime's 60% and the 40% management stake in Pelham Bell Pottinger together with various Group central costs. Chime would retain a 25% minority stake and the transaction is expected to be accretive once proceeds are reinvested.

The terms of this transaction have been agreed and are based on 2011 profits. Its completion remains subject to the finalising of financing arrangements and the completion of due diligence. It is expected that agreements will be signed before the end of May with a circular being sent to shareholders shortly thereafter so that the shareholder meeting will take place in mid-June with completion expected to take place at the end of June.

The Sports Marketing Division

This division is continuing to show strong growth and is set to benefit from the first contribution from the recently announced acquisitions. The division achieved over 50% growth in income in the period with a positive impact from the forthcoming Olympics and Paralympics.

Advertising and Marketing Services Division

VCCP continues to perform well with very high profile creative work and a good new business pipeline. The division has achieved 10% growth in income in the period with some high profile new business wins.

The Public Relations Division

This division has seen a decline in revenue and profit so far this year which, together with the ending of the sizeable American Government contracts, means the division is not expected to make the full year forecast.

Insight and Engagement Division

This division is currently benefiting from a recovery in trading that management has been working towards. The positive trading in 2012 includes the first contribution from the newly established digital business, Watermelon.

If the MBO is completed, Chime will reinvest the proceeds in sectors of the market which are expected to show good growth and in the divisions where we have strong positions. Therefore, going forward, the Group believes that its prospects remain strong and that the repositioning will provide a strong return for shareholders in the future although we will not be immune from any deterioration in market conditions.

- Ends-

For further information please contact:

Lord Bell, Chairman 020 7861 8515

Chime Communications

Christopher Satterthwaite, Chief Executive 020 7861 8515

Chime Communications

James Henderson / Victoria Geoghegan / Emma Kent 020 7861 3232

Pelham Bell Pottinger

Notes to Editors

The Chime Group helps clients create, manage, monitor and market their businesses, brands and reputation both in the UK and internationally.

Chime is the holding company for the UK's leading public relations group, Bell Pottinger; one of the fastest growing advertising and marketing services groups in the UK that includes VCCP and Teamspirit; the UK's number one sports marketing group that includes Fast Track and Essentially Group; and the leading research group which includes Facts International and Opinion Leader Research.

For more information please go to www.chime.plc.uk