CHW.L Regulatory News (CHW)

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 2011 to 11th May 2011 (as required by the UK Listing Authority's Disclosure and Transparency rules) ahead of its Annual General Meeting ("AGM") today.

At the AGM Lord Bell, Chairman of Chime Communications, will make the following statement:

"The Group's track record of growth has continued into the first four months of 2011, with good organic growth and growth from acquisitions. We expect strong organic growth in operating income in 2011 and expect to be slightly ahead of market expectations.

78% of forecast operating income for 2011 is now committed compared to 77% this time last year. New client wins so far in 2011 have included easyJet, RIM Blackberry, Birds Eye Iglo Group, Williams F1 (IPO), Woolworths.co.uk, G4S, Deloitte and Tesco.

We announced the acquisition of ICON on 6th April 2011 and we expect a strong profit contribution from this in 2011 and beyond. Since joining Chime it has won a competitive pitch for the Barclays Scottish Open and has recently undertaken the re-branding of the Kia Oval for Surrey County Cricket Club. It has a very strong new business pipeline. 

Today we are announcing an agreement to acquire 60% of the share capital of Golden Goal Sports Venues ('Golden Goal'). Golden Goal was set up in 2005 in Brazil by its two founding directors and major shareholders - Cadu Ferreira and Mauro Correa. Following the transaction Cadu Ferreira and Mauro Carrea will each retain 20% of Golden Goal and will remain with the business. 

Golden Goal is involved in both sponsorship consulting and rights selling for major companies and sporting federations. Its major clients include AC Milan, Petrobras, Flamengo, Botafogo and Banco do Brasil. Sponsorship investment in Brazil is forecast to double over the next four years with the FIFA World Cup in 2014 and the Olympic Games in 2016. With a foothold in the Brazilian market we intend to export knowledge from around the Chime Sports Marketing Division to Rio de Janeiro in areas of event activation, consultancy and sales. We are also looking forward to Golden Goal providing a base for the services of our recent acquisition ICON which played a pivotal role in the city branding programmes at the last FIFA World Cup in South Africa.

Under the terms of the transaction the initial consideration for 60% of the share capital of Golden Goal is £2.4 million in cash which represents a multiple of 5.3 times 2010 profits before interest and tax (EBIT). In addition, two further tranches of deferred consideration may become payable in March 2014 and March 2017, based on average EBIT. Total consideration is capped at Brazilian Rials 25 million (£9.5 million).

It is our intention to relocate at least one existing senior executive from the Chime Sports Division to Golden Goal in the near future.

We continue to manage cash flow very carefully. We remain focused on cost control and to reducing the percentage of our costs that are fixed.

The Public Relations Division. Most businesses have shown good growth, particularly financial, corporate and consumer public relations. The continuing political problems in the Middle East and North Africa have had little or no impact on our geopolitical business and overall we expect this division to perform in line with budget. 

The Sports Marketing Division continues to grow and the marketplace remains strong. The businesses acquired as part of the Essentially Group have performed particularly well. The first half of 2011 will include the first contribution from the new office in Hong Kong. The integration of all our sports marketing businesses under the overall group brand of CSM is complete and Essentially and Fast Track companies in London now share a location in Victoria.

The Advertising and Marketing Services Division investments made during 2010 are now starting to contribute and this division will show our strongest organic growth in the first half of 2011 with VCCP UK, VCCP Germany, Digital and Search performing particularly well. The first half of 2011 will include our investment in Open Health and this should start to make a profit in the second half of 2011.

The Research Division has continued its recovery and should be slightly ahead of 2010 in the first half of 2011. 

- 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