Conduit Hldg Regulatory News (CRE)

3 Feb 2009 07:00



3 February 2009

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 2 February 2009.

Financial Performance Indicators

Trading for the nine months ending December 2008 have been in line with the Board's expectations and demonstrate growth during a difficult economic environment:

Revenue growth of 4%

Headline operating profit margin after head office costs of 18% (2008: 18%) 

Operating cash conversion from EBITDA of 97 percent. 

Headline performance measures exclude the impact of the non-recurring charges outlined in the Company's Interim statement.

New Business

In the Interim statement for the six months ending September 2008, the Group announced net new business revenue annualised at £11m (2008: £5m). This excellent new business performance has continued to date with further wins across both Divisions, which include Boehringer Ingelheim, COI (Stroke Awareness), Unilever (Lynx), Services at Home, Spicers and Xchanging. As the new calendar year starts, there continues to be a good pipe line of new business opportunities across the Group and recent wins that will be announced shortly.

Operational Trading

The Board's business objectives remain unchanged with a focus on reducing debt and maintaining upper quartile key performance indicators (KPIs), such as revenue per head, operating profit margin and cash conversion. As noted above the cash conversion on EBITDA for the nine months has been good and the reduction in net debt remains in line with the Board's expectations.

As reported in the Group's Interim statement, only 21 per cent of the Group's revenue is in advertising and over 70 per cent in direct and digital marketing, healthcare marketing and market research. This diversification towards more resilient areas of the marketing industry has benefited the Group as demonstrated in the financial performance noted above.

The Communications Division has benefited from its weighting towards direct and digital marketing and offering integrated on and off line communication. This Division continues to achieve strong year on year growth driven by an excellent new business performance.

Trading for the Insight Division continues to be robust in the larger companies ICM and Marketing Sciences. However, as reported in the Interims the niche discipline of qualitative market research continues to experience a year-on-year decline and the Company has taken the necessary steps to align costs and structure to the trading outlook.

Outlook

The Board is realistic about the tough trading environment the UK economy faces and as the Group prepares for the new financial year, it will reduce its operating cost base where necessary, so its KPIs remain in line. Based on the nine month trading performance to the end of December 2008, the Group remains on course to meet the Board's expectations for the current financial year. 

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About Creston plc

Creston is an Insight and Communications marketing services group. The Board's aim is to identify synergistic benefits between its marketing services companies offering premium services such as market research, direct and interactive marketing, advertising, public relations, insight; and to build a Group that offers effective and accountable marketing solutions across both on-line and off-line channels. 

Creston's companies boast a range of blue-chip clients including the Amazon, AstraZeneca, Bayer, BMW, BT, Burger King, Canon, COI Communications, Cow & Gate, Daily Mirror, Diageo, eBay, First Direct, General Motors, GlaxoSmithKline, Halifax, Homeform, House of Fraser, Kimberly-Clark, Lexus, Lloyds Black Horse, Morrisons, NHS Lottery, Nissan, Norwich Union, Pfizer, Roche Diagnostics, Royal Mail, SAB Miller, Sainsbury's, Tesco, Thorpe Park, Toshiba, Trinity Mirror, T-Mobile, Tropicana, Unilever, Vodafone, Walkers and WH Smith.

Creston's share price is quoted in the Financial Times, The Daily Telegraph, The Times and the London Evening Standard.