Conduit Hldg Regulatory News (CRE)

7 Aug 2008 07:00



Press Release  7 August 2008

Creston plc 

Interim Management Statement 

Creston plc (LSE: CRE), the Insight and Communications Group, announces its interim management statement for the period 1 April 2008 to 6 August 2008.

Operational Trading

The Group has started the year with a like-for-like revenue growth of 5% during the first quarter April to June 2008. It is also benefiting from strong new business wins  from major clients including: COI, Daily Mirror, House of Fraser, Insignia (General Motors) and The Health Lottery in its consumer communication agency DLKW; new product wins from GSK and Pfizer in its healthcare communication agency PAN; and Berry Bros, Gordons Gin, Lipton, PG Tips, Pfizer and Sainsbury's Business Direct in its direct marketing agency TMW. Other new business wins across the Group include McNeil, Miller & Pilsner (SAB), Takeda and Trainline and the Board is pleased with the retention of the Halifax advertising account by DLKW.

The Group has continued to develop strategically across the four pillars of growth outlined in the Company's preliminary announcement for the year ended March 2008. The progress includes:

the continued consolidation in the Insight Division with the integration of MSTS to MSL;

developing the integrated and digital client offer to benefit from the continued shift of spend from traditional advertising to integrated on and off line communication;

driving synergies across the Group companies with the new offer of healthcare relationship marketing from the joint venture "Hi" between PAN and TMW. 

geographic expansion to broaden our client offer with a minority ownership in a new start up in Asia under the brand name of the subsidiary TRA.

We are encouraged by the continued growth in revenue, whilst we remain focussed on controlling our costs and maximising efficiencies in order to respond quickly to changes in the market conditions.

Having renegotiated our banking facility, we settled in April 2008 the remaining DLKW earn out liability of £13.9 million in cash (£1 million) and loan notes (£12.9 million) with a nine month redemption. The Group maintains significant headroom in all its banking covenants giving the Group the option to settle all future earn out liabilities in loan notes and cash rather than equity should it be appropriate.

Outlook

The diversified nature of the Group, with a heavy weighting in market research and direct marketing, is proving a resilient model as demonstrated by the first quarter revenue growth achieved in a volatile economic climate. Based on this progress to date, the Group remains on course to meet the Board's expectations for the full year.

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