Last checked at 17 Jan 2024 07:00
17th January 2024
The Mission Group plc
("MISSION" the "Company" or the "Group")
Trading Update
The MISSION Group plc (AIM: TMG), creator of Work That CountsTM, comprising a group of digital marketing and communications Agencies, provides a trading update for the financial year ended 31 December 2023 ("FY2023").
TRADING
Trading in the final three months of 2023 was significantly improved on the previous quarter and the Group's performance for FY2023 is expected to be in line with the revised guidance issued in its update to the market on 23 October 2023 ("the Update").
The Group expects to report FY2023 revenue (operating income) of £87.0m representing growth of 9% on 2022, including the impact of 2023 acquisitions, and at the higher end of the guidance provided in the Update and ahead of Advertising Association expectations for 2023 of 2.6%.
Headline profit before tax from continuing operations, (excluding the trading loss relating to the Group's Pathfindr business, the disposal of which was announced on 5 January 2024), is expected to be in line with the revised guidance in the Update of £4.3m. Earnings before Interest, Taxation, Depreciation and Amortisation (EBITDA) from continuing operations are expected to be approximately £10.0m on the same basis.
Trading in 2024 has started well with a number of new business wins already secured including assignments with existing Client Boehringer Ingelheim, expanding our involvement with the animal health arm of their business. The new remit includes activity from top-level strategy, through to activation for an exciting portfolio of brands.
Other new business wins across the Group since the start of the new financial year include new Client Herta UK for MISSION Agency Speed. Speed will be working closely with the UK arm of German based Herta, which provides quality chilled goods to consumers and will be focused on amplifying Herta UK's presence within trade and consumer media. Bray Leino have also been delighted to announce a new Client mandate with global pharmaceutical company Dr. Reddy's. The new scope includes all facets of marketing from branding and packaging to event creation and delivery.
VALUE RESTORATION PLAN ("VRP")
The Group continues to make good progress against its recovery plan to drive significant cost saving initiatives and margin improvements and has now secured an annualised, projected £5m of profit improvements for 2024. This includes an initial £2m of annualised costs savings relating to headcount reduction in certain of the Group's business units and a further £3m of annualised non-agency cost savings and profit improvements.
Part of the Group's VRP also includes the selected disposals of two non-core businesses and on 5th January 2024 the Group was pleased to confirm the disposal of its 80% shareholding in Pathfindr ltd, with the initial proceeds of £1m being deployed to reduce debt.
BALANCE SHEET
Net bank debt as at 31 December 2023 is estimated to be £15.5m. This is a considerable improvement on the previously stated guidance of £24m, provided in the Update.
This improvement has been driven by strong working capital control both in regard to billing and debtor days management and the active management of our creditors, including an agreed £4.3m HMRC Time To Pay arrangement phased over the first quarter of 2024.
The Group enters 2024 with the benefit of significantly improved headroom against its current debt facility of £29m.
Chief Executive of MISSION, James Clifton, commented: "Whilst 2023 has not been without significant challenges, the Board is pleased with the progress being made to restore value for shareholders through the Value Restoration Plan.
"Whilst there is much more to do, efficiencies are quickly being realised and we are particularly pleased to have achieved a significant reduction in net debt against our original forecasts.
"Trading momentum in the later part of 2023 was encouraging, with growth ahead of the market, and the recent new business wins in January give us confidence as we enter 2024."
ENDS
ENQUIRIES
James Clifton, Chief Executive Officer Giles Lee, Chief Financial Officer The MISSION Group plc |
Via Houston |
Simon Bridges/Andrew Potts/Harry Rees | |
Canaccord Genuity Limited (Nominated Adviser and Broker) | 020 7523 8000 |
Kate Hoare / Alexander Clelland / India Spencer | |
HOUSTON (Financial PR and Investor Relations) | 0204 529 0549 |
NOTES TO EDITORS
MISSION is a collective of digital marketing and communications Agencies employing over 1,000 people across 29 locations and 3 continents. The Group successfully combines its diverse expertise to produce Work That Counts TM for Clients, whatever their ambitions. Creating real standout, sharing real innovation and delivering real growth for some of the world's biggest brands. www.themission.co.uk
The person responsible for arranging the release of this announcement on behalf of MISSION is James Clifton.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse (Amendment) (EU Exit) Regulations 2019. Upon the publication of this announcement, this inside information is now considered to be in the public domain.