AGENCY PERFORMANCE LEAGUE: Despite a sense of economic caution permeating the ad industry, operating profits for the top 50 agencies have increased 21.4 per cent

By BOB WILLOTT, the editor of Marketing Services Financial Intelligence and a special professor at the University of Nottingham Business School, campaignlive.co.uk, Friday, 11 October 2002 12:00AM

Many agencies were seemingly oblivious to the industry's underlying inefficiency as they headed into 2001, with revenues growing by a healthy 12.3 per cent, according to Willott Kingston Smith's latest annual survey of the industry's finances.

Staff costs were growing even faster as their scarcity value increased and handsome profit-sharing bonuses were triggered. Yet, helped by relatively stable overheads, operating profits increased by a splendid 21.4 per cent for the top 50 agencies.

Almost certainly, the mood remained buoyant on the back of such a profit improvement. If managements were complacent, this was possibly encouraged by the knowledge that total operating costs per employee had risen by a mere 3.4 per cent - little more than inflation. So they could hardly be accused of profligacy.

The snag is that, because the sector was already operating at an inefficient level before the period covered by the latest published accounts, it would have needed a much bigger improvement in efficiency to restore profit margins to the traditional 15 per cent benchmark. In the latest survey only 11 of the 50 agencies achieved that margin.

By contrast, media agencies have been doing far better. But there is nothing to be gained by whingeing about the way in which the media moguls historically stripped vast swathes of business out of full-service agencies, while leaving most of the overheads behind!

Declining interest rates may have eroded some of the income that media buying agencies enjoy from interest on the funds that flow through their books (and which is treated as part of their operating profit in the survey), but five of the ten biggest operators still reported margins in excess of 15 per cent.

Even the mighty Aegis Group, where acquisition activity has left it bereft of any interest-earning funds, reported an operating profit margin of 16.7 per cent, albeit before the exceptional bad debt provisions and reorganisation costs that dragged it down to 12.9 per cent.

To make comparisons as meaningful as possible, the survey sensibly excludes both exceptional costs and the amortisation of goodwill when calculating operating profits and profit margins. As a consequence, the reported margins are presented in their most favourable light. Yet it is questionable whether the costs of reducing headcount should be treated as exceptional when there has never been any question about excluding costs of acquiring staff.

Similarly, why should operating profits and margins be spared from the impact of decisions by companies such as Aegis and Cordiant that they should write off part of the cost of acquisitions after consciously acknowledging that they had paid more than future estimated profit streams could justify?

Or that the value of the goodwill asset so acquired should be systematically amortised against annual profits because it has a limited life? Yet that is what happens.

The more encouraging message from the survey is that some agencies are still able to achieve impressive results and that the averages are dragged down by a few large agencies such as the Saatchi & Saatchi Group and Grey Worldwide that under-performed in a big way.

Particularly noteworthy among the star performers was Mustoe Merriman Levy Holdings, which achieved the best operating margin of 28.8 per cent, followed by the financial agency Citigate Albert Frank with 23.2 per cent and - before the client defections - HHCL & Partners with 23 per cent. Maybe HHCL's profit margins reflected an over-enthusiastic attitude towards fees that latterly was not adequately supported by what the agency delivered.

At the other extreme, the Saatchi & Saatchi Group suffered a heavy £12 million loss as costs outstripped income by a staggering £17,858 per employee.

Did Publicis really know what it was buying for £1.2 billion? Productivity was poor with output per employee of £76,634 (measured in terms of the agency's gross income per head), well below the average of £90,927.

The only redeeming feature was the agency's success in pulling down its staff costs by 11 per cent to £49,511 per head. No wonder there have been changes at Saatchis following the Publicis takeover - changes that Publicis claims are now having a positive effect.

At Grey each employee shouldered a loss of £12,364. Yet this seems hard to believe when output per head was quite healthy at £97,170 and staff costs accounted for a respectable 49 per cent of that. Perhaps the UK agency had to make generous contributions to its US parent's management.

Several other members of the multinational agency groups failed to achieve the level of productivity per employee necessary to justify their above-average staff costs. Most notable among them were Leo Burnett, Bates UK and Euro RSCG Wnek Gosper.

Average staff costs at Euro RSCG were a very generous £60,597 per employee.

Those costs may have been inflated by the accrual of long-term incentive payments of £1.1 million - accounting for a little more than 10 per cent of total staff costs. Excluding those incentive payments, the staff costs would have been nearer £55,000, still above the average but less glaringly so.

In theory, such incentive rewards should be met out of higher productivity, rather than eroding an already depressed profit margin. However, at Euro RSCG the operating profit per head fell below the average of £7,730 even before accruing the bonuses, and a long way short of Fallon's £31,538 and Mustoe Merriman's £25,865.

Altogether Euro RSCG had accrued £2.8 million for long-term incentive payments that had not yet been paid. Expectant employees will have been reassured to know that Euro RSCG had £6.4 million in the bank at the balance sheet date.

Are the profits reported by foreign-owned agencies such as Euro RSCG, Leo Burnett and Grey deliberately depressed by devices used to ship profits to the home country before the UK's tax inspectors can get their claws into them?

To some extent this seems likely, insofar as management charges serve this purpose and can also be successfully defended by the companies involved.

But the tax authorities can and do challenge any obviously unrealistic transactions, so the scope for manipulation must have its limits.

Another depressing influence can be the allocation of global client revenue between offices. It is rarely possible to earn as good a profit margin in the UK on foreign-based global clients as it is to do so on domestic business. Whatever the reason, the over-riding evidence is that many foreign-owned agencies under-perform in the UK.

By contrast, the profits earned per employee at Fallon and Mustoe Merriman were clearly excellent and support the notion that agencies owned or controlled within the UK tend to produce a better financial performance that many of the agencies controlled from abroad. (The UK management still held a strong stake in Fallon during the period under review.)

As a simple yardstick, if output (gross income) per head was £100,000, operating profit typically should be about £15,000 if the traditional 15 per cent profit margin were to be achieved. Fallon's output per head was an impressive £138,692, but even after allowing for the possibility of static overheads, an operating profit per head of £31,538 was a notable achievement.

By contrast, Camp Chipperfield's astonishingly high output per head of £167,808 (up 43 per cent on the previous period) only generated operating profit per head of £21,846 - a profit margin of 13 per cent.

So not every company with healthy output in excess of £100,000 per head delivered an equally healthy level of profit. For example, Abbott Mead Vickers BBDO fell well short of its historically excellent performance by reporting an operating profit of £5,853 per head (or 5.8 per cent) on output per head of £101,440. Its former subsidiary, Leagas Delaney London, delivered an even less impressive operating profit of £4,267 per head on output of £113,317 (a margin of just 3.8 per cent).

Recognising that high levels of output per employee do not guarantee high profits, it is equally important to note that good profits can occasionally be earned from lower levels of revenue. Proof of that is found at Golley Slater where profit per head was £18,240 on output per head of a mere £79,872.

Running a regional agency has different financial implications from those of a London one. The work is often different and costs are often lower.

But the work can be messy and labour intensive. Golley Slater seems to have cracked that particular problem.

How did the biggest agencies perform? Only one of the ten largest agencies (measured by gross income/revenue) achieved a respectable profit margin of 15 per cent or more, and that was the McCann-Erickson UK Group. The achievement is somewhat surprising, given that revenue per head was fairly poor at £75,561 and staff costs - although also rather low at £42,547 per head - consumed a chunky 56 per cent of that revenue.

We now know that McCann's European network ran up accounting errors of $68 million over recent years, principally from inter-office charges for client work, so a fairly large question mark must hang over the excellent 17.5 per cent profit margin reported in the survey period.

Whatever the truth about McCann's margin, the fact remains that a smaller proportion of the biggest agencies achieved the benchmark margin of 15 per cent than was achieved by the sample as a whole.

Similarly, the smallest agencies were also less successful in achieving a 15 per cent profit margin. So the conclusion is that mid-size agencies do best, particularly if they are UK-owned or controlled.

Probably of greatest interest is the agency that paid the highest average staff costs. In this survey it was Fallon, at £70,128. Yet it still reported the best profit per head.

Less profitable was Leagas Delaney where staff were paid an average of £66,192, second only to Fallon. Leagas Delaney has virtually always reported high average staff costs, but it has yet to prove that it can turn that expensive resource into a really profitable one.

Looking at all the UK-based marketing services groups, rather than the advertising agencies alone, which director enjoyed the biggest pay package?

It wasn't WPP's Sir Martin Sorrell or Cordiant's Michael Bungey, but a director of the Abbott Mead Vickers group with £1.8 million. Presumably that beneficiary was Peter Mead as he was reported by Omnicom to have earned nearly $3 million that year. Sorrell waived his bonus entitlement for 2001 and drew only £1.2 million.

The real surprise was the owner of the City public relations consultancy The College Group - Alex Sandberg. He took home a hefty pay packet amounting to £909,000, better than the £835,000 earned both by Bungey and by Aegis Group's Doug Flynn. The surprising feature about Bungey's remuneration package is not that he failed to earn a bonus this time, but that in a loss-making year he enjoyed a 16 per cent increase in the other core elements.

With the measurement of profit always open to argument, it is hardly surprising that some commentators have been inclined to focus on a much simpler item - cash. In some ways this has merit, because cash is the lubricant that enables a business to function. But on the other hand, as many receivers and liquidators know, cashflow can often be very positive just before the final demise of a struggling business. So over-reliance on monitoring cash movements can be rather dangerous.

No-one is suggesting that the receivers are queuing up outside loss-making Cordiant at present, but equally the positive cashflow of £24.5 million which followed a restructuring of its debt should not encourage any great optimism. It is on public record that, within legal limits, its bankers have taken an element of control over the group's chequebooks and doubtless the focus within the group is now on reducing its indebtedness.

However, most of the other groups reporting a healthy positive cashflow can point to good underlying profits as the main cause. BBH Holdings, the Golley Slater Group, the Imagination Group and M&C Saatchi Worldwide are four examples.

But Huntsworth falls into a different category. That company is, in effect, a revamped version of loss-making Holmes & Marchant, restored by a capital injection from the former Shandwick founder Peter Gummer (now Lord Chadlington) and a public share issue.

As the gloomy trading environment continues, the need to maintain profit margins, productivity and cashflow will remain at the top of agencies' financial agendas.

- The Financial Performance of Marketing Services Companies 2002 is available from Willott Kingston Smith (020 7566 3850) priced £325.

TOP 50 AGENCIES

Rank Agency Year ends Operating profit

per head

Latest Previous Change

(pounds) (pounds) (%)

1 Fallon London 31/12/01 31,538 41,833 -24.61

2 Mustoe Merriman Levy Holdings 30/06/01 25,865 21,833 18.47

3 Howell Henry Chaldecott Lury 31/12/00 24,808 28,053 -11.57

4 Citigate Albert Frank 28/02/01 23,261 28,389 -18.06

5 Banks Hoggins O'Shea/FCB 31/12/00 22,201 18,919 17.35

6 Camp Chipperfield Hill Murray 30/04/01 21,846 13,192 65.60

7 Golley Slater Group 30/11/00 18,240 13,212 38.05

8 Masius 31/12/00 17,604 19,621 -10.28

9 Mother 31/12/01 17,105 19,641 -12.91

10 St Luke's Holdings 31/12/00 16,246 23,663 -31.35

11 Delaney Lund Knox Warren &

Partners 31/12/01 16,040 22,707 -29.36

12 The Ogilvy Group (Holdings) 31/12/00 15,727 13,434 17.07

13 WCRS 31/12/00 14,134 29,957 -52.82

14 McCann-Erickson UK Group 31/12/00 13,243 11,809 12.15

15 DFGW 30/09/01 13,125 10,542 24.50

16 Travissully 31/12/00 12,429 6,472 92.03

17 BMP DDB 31/12/00 12,428 10,556 17.73

18 Bartle Bogle Hegarty 31/12/01 11,972 10,220 17.13

19 Maher Bird Associates 31/12/01 11,784 13,633 -13.57

20 M&C Saatchi 31/12/00 11,673 8,263 41.28

21 TBWA/London 31/12/01 11,648 15,717 -25.89

22 J. Walter Thompson Group 31/12/00 11,370 11,813 -3.75

23 Lowe Lintas 31/12/00 11,344 3,278 246.09

24 Miles Calcraft Briginshaw

Duffy 30/06/02 11,268 9,636 16.94

25 CheethamBell JWT 31/12/01 10,881 1,395 680.16

26 Publicis 31/12/01 10,169 12,399 -17.98

27 Roose & Partners Advertising 30/09/00 8,717 8,000 8.97

28 Burkitt DDB 31/12/00 7,826 4,452 75.80

29 Faulds Advertising 31/12/00 6,744 357 1,788.21

30 Young & Rubicam Group 31/12/00 6,736 5,338 26.18

31 Partners BDDH 31/12/01 6,682 13,977 -52.19

32 DraftWorldwide 31/12/00 6,581 3,517 87.11

33 BDH/TBWA 31/12/01 6,075 1,500 304.98

34 Abbott Mead Vickers BBDO 31/12/00 5,853 9,858 -40.63

35 Bray Leino 31/12/01 5,612 11,968 -53.11

36 Senior King Communications

Group 31/12/01 4,744 6,187 -23.32

37 Leagas Delaney London 31/12/00 4,267 2,626 62.48

38 Brahm 31/07/01 3,525 4,725 -25.40

39 Red Cell Advertising 31/12/00 3,500 9,857 -64.49

40 D'Arcy Masius Benton & Bowles 31/12/01 2,966 -5,203 -157.01

41 Advertising Principles

(Group) 31/03/01 2,014 3,026 -33.42

42 Robson Brown 28/02/01 2,000 4,523 -55.78

43 Euro RSCG Wnek Gosper 31/12/00 1,284 -788 -262.86

44 Collett Dickenson Pearce

UK Advertising 31/12/00 553 412 34.23

45 Bates UK 31/12/00 -90 727 -112.44

46 Leo Burnett 31/12/00 -371 3,682 -110.07

47 Interfocus Network 31/12/01 -7,107 20,234 -135.13

48 Grey Advertising 30/09/00 -12,364 -9,991 23.74

49 TMP Worldwide 31/12/00 -17,756 3,583 -595.55

50 Saatchi & Saatchi Group 31/12/00 -17,858 -25,269 -29.33

Rank Agency Staff costs Gross income

per head (revenue)

per head

Latest Change Latest Change

(pounds) (%) (pounds) (%)

1 Fallon London 70,128 12.03 138,692 -4.96

2 Mustoe Merriman Levy Holdings 45,981 -1.34 89,712 -1.78

3 Howell Henry Chaldecott Lury 52,731 -4.55 108,073 0.62

4 Citigate Albert Frank 53,841 7.25 100,318 2.04

5 Banks Hoggins O'Shea/FCB 51,910 -2.97 106,736 1.83

6 Camp Chipperfield Hill Murray 60,923 22.51 167,808 43.19

7 Golley Slater Group 45,520 14.76 79,872 17.14

8 Masius 47,057 4.61 95,132 1.43

9 Mother 48,246 -11.04 97,895 -3.47

10 St Luke's Holdings 49,585 7.62 89,466 -2.42

11 Delaney Lund Knox Warren &

Partners 58,320 6.84 100,373 -7.68

12 The Ogilvy Group (Holdings) 51,172 4.73 122,118 -4.26

13 WCRS 60,149 1.76 96,186 -6.39

14 McCann-Erickson UK Group 42,547 5.87 75,561 6.10

15 DFGW 48,750 14.32 88,911 9.61

16 Travissully 52,829 2.75 101,914 9.62

17 BMP DDB 56,122 7.96 100,411 6.47

18 Bartle Bogle Hegarty 56,413 8.31 103,486 7.41

19 Maher Bird Associates 53,919 7.34 95,595 -3.34

20 M&C Saatchi 52,778 3.38 97,569 2.51

21 TBWA/London 54,140 -10.78 104,767 -4.81

22 J. Walter Thompson Group 61,874 14.41 104,877 7.69

23 Lowe Lintas 56,367 5.72 100,341 -2.23

24 Miles Calcraft Briginshaw

Duffy 58,561 9.24 104,073 1.94

25 CheethamBell JWT 30,683 20.70 64,129 22.70

26 Publicis 55,212 5.91 94,478 1.05

27 Roose & Partners Advertising 63,739 11.26 110,000 8.10

28 Burkitt DDB 44,957 3.39 79,290 9.27

29 Faulds Advertising 44,038 17.12 47,026 25.10

30 Young & Rubicam Group 45,696 14.65 90,578 11.46

31 Partners BDDH 55,835 0.97 93,129 -7.11

32 DraftWorldwide 44,486 21.08 72,791 9.77

33 BDH/TBWA 43,084 -1.83 77,140 8.95

34 Abbott Mead Vickers BBDO 62,991 6.51 101,440 6.35

35 Bray Leino 32,534 4.73 48,097 -5.43

36 Senior King Communications

Group 28,038 26.92 46,038 25.80

37 Leagas Delaney London 66,192 6.11 113,317 11.13

38 Brahm 29,228 -4.01 46,782 -5.99

39 Red Cell Advertising 40,056 0.50 96,361 0.83

40 D'Arcy Masius Benton & Bowles 57,935 -4.09 92,546 6.95

41 Advertising Principles

(Group) 32,381 7.94 48,245 -9.22

42 Robson Brown 28,474 0.85 37,421 -2.60

43 Euro RSCG Wnek Gosper 60,597 -3.15 95,915 2.72

44 Collett Dickenson Pearce

UK Advertising 46,058 0.57 72,000 10.13

45 Bates UK 57,793 20.79 95,953 8.44

46 Leo Burnett 55,206 9.05 95,073 10.34

47 Interfocus Network 50,357 29.84 77,381 -9.43

48 Grey Advertising 47,755 -5.31 97,170 -5.81

49 TMP Worldwide 45,926 33.19 64,253 10.78

50 Saatchi & Saatchi Group 49,511 -10.97 76,634 -2.56

Rank Agency Operating profit: gross Gross income

income margin (revenue)

Latest Change Latest Change

(%) (%) (pounds' (%)

'000)

1 Fallon London 22.74 -20.67 5,409 23.55

2 Mustoe Merriman Levy Holdings 28.83 20.61 4,665 6.41

3 Howell Henry Chaldecott Lury 22.96 -12.11 20,858 27.76

4 Citigate Albert Frank 23.19 -19.70 8,828 -0.23

5 Banks Hoggins O'Shea/FCB 20.80 15.23 15,370 18.26

6 Camp Chipperfield Hill Murray 13.02 15.65 4,363 43.19

7 Golley Slater Group 22.84 17.85 14,297 17.14

8 Masius 18.50 -11.54 5,042 -7.32

9 Mother 17.47 -9.78 5,580 41.09

10 St Luke's Holdings 18.16 -29.64 10,557 21.21

11 Delaney Lund Knox Warren &

Partners 15.98 -23.49 7,528 -7.68

12 The Ogilvy Group (Holdings) 12.88 22.28 68,020 30.70

13 WCRS 14.69 -49.60 18,660 -3.41

14 McCann-Erickson UK Group 17.53 5.70 82,739 13.46

15 DFGW 14.76 13.59 4,979 4.03

16 Travissully 12.20 75.18 3,567 6.57

17 BMP DDB 12.38 10.58 47,896 7.82

18 Bartle Bogle Hegarty 11.57 9.06 32,805 5.74

19 Maher Bird Associates 12.33 -10.58 3,537 19.21

20 M&C Saatchi 11.96 37.81 29,856 32.92

21 TBWA/London 11.12 -22.14 24,725 -10.50

22 J. Walter Thompson Group 10.84 -10.62 49,292 7.69

23 Lowe Lintas 11.31 253.97 30,905 39.42

24 Miles Calcraft Briginshaw

Duffy 10.83 14.71 4,267 26.65

25 CheethamBell JWT 16.97 535.81 6,477 226.13

26 Publicis 10.76 -18.83 46,294 22.56

27 Roose & Partners Advertising 7.92 0.80 5,060 10.50

28 Burkitt DDB 9.87 60.89 5,471 21.60

29 Faulds Advertising 14.34 1,409.41 3,668 -0.43

30 Young & Rubicam Group 7.44 13.20 90,850 10.91

31 Partners BDDH 7.18 -48.53 7,916 -9.24

32 DraftWorldwide 9.04 70.45 10,773 180.11

33 BDH/TBWA 7.87 271.73 8,254 18.95

34 Abbott Mead Vickers BBDO 5.77 -44.18 34,388 8.59

35 Bray Leino 11.67 -50.42 4,954 4.74

36 Senior King Communications

Group 10.30 -39.05 7,366 21.25

37 Leagas Delaney London 3.77 46.20 13,598 8.42

38 Brahm 7.53 -20.65 4,725 18.69

39 Red Cell Advertising 3.63 -64.78 3,469 3.71

40 D'Arcy Masius Benton & Bowles 3.21 -153.30 44,052 9.01

41 Advertising Principles

(Group) 4.18 -26.66 6,706 7.85

42 Robson Brown 5.34 -54.61 3,555 7.60

43 Euro RSCG Wnek Gosper 1.34 -258.54 16,881 15.89

44 Collett Dickenson Pearce

UK Advertising 0.77 21.88 7,416 -0.50

45 Bates UK -0.09 -111.47 32,912 28.70

46 Leo Burnett -0.39 -109.13 23,578 -13.95

47 Interfocus Network -9.18 -138.78 6,500 -28.90

48 Grey Advertising -12.72 31.37 24,584 3.61

49 TMP Worldwide -27.63 -547.31 43,178 3.11

50 Saatchi & Saatchi Group -23.30 -27.47 47,360 -4.11

Source: Willott Kingston Smith annual survey "Financial Marketing

Services Companies". Results are based on latest statutory accounts

filed at Companies House. Where an accounting period was not 12 months

long, results have been prorated to represent a 12-month trading period.

COMMUNICATIONS GROUPS

Turnover

Latest Change

pounds '000 %

1 Omnicom Group 28,720,211 11.9

2 The Interpublic Group of

Companies 28,042,348 -6.3

3 WPP Group 20,886,900 49.7

4 Publicis SA 11,111,333 41.2

5 Dentsu 10,079,494 13.4

6 Bcom3 Group 7,992,924 4.6

7 Aegis 6,095,700 6.7

8 Grey Advertising 5,073,423 -2.4

9 Havas Advertising 4,471,095 18.3

10 Hakuhodo 4,012,283 -8.4

Gross income Operating profit

margin

Latest Change Latest Change

pounds '000 % % %

1 Omnicom Group 4,305,879 11.9 14.1 -1.5

2 The Interpublic Group of

Companies 4,204,250 -6.3 11.0 22.1

3 WPP Group 3,789,700 38.5 13.7 -4.8

4 Publicis SA 1,622,667 37.5 8.2 -40.2

5 Dentsu 1,677,139 16.2 20.5 19.1

6 Bcom3 Group 1,198,339 4.6 8.0 355.5

7 Aegis 605,000 17.9 13.7 -4.8

8 Grey Advertising 760,633 -2.4 1.7 -68.0

9 Havas Advertising 1,494,279 24.8 3.6 -72.7

10 Hakuhodo 504,628 -11.0 9.3 -55.1

TOP TEN MEDIA BUYING AGENCIES

Agency Year ends Gross income

Latest Change

pounds '000 %

1 Aegis Group 31/12/01 425,800 11.2

2 Tempus Group 31/12/00 151,284 64.1

3 Zenith Media Holdings 31/12/00 67,469 18.3

4 MindShare Media UK 31/12/01 23,035 21.2

5 MediaCom UK 30/09/01 19,132 27.5

6 PHD Media 31/12/01 16,903 4.9

7 Starcom Motive 31/12/01 16,141 32.9

8 Initiative Media London 31/12/00 12,128 19.3

9 Media Planning 31/12/00 9,727 34.8

10 Optimedia International 31/12/00 9,561 17.1

Agency Operating profit Operating profit

margin

on gross income

Latest Change Latest Change

pounds '000 % pounds '000 %

1 Aegis Group 71,100 -15.9 16.70 -24.4

2 Tempus Group 20,878 47.3 13.80 -10.2

3 Zenith Media Holdings 9,032 7.7 13.39 -9.0

4 MindShare Media UK 2,270 47.1 9.85 21.4

5 MediaCom UK 2,327 93.4 12.16 51.7

6 PHD Media 5,003 175.8 29.60 162.9

7 Starcom Motive 4,651 48.7 28.81 11.9

8 Initiative Media London 751 -9.4 6.19 -24.1

9 Media Planning 3,044 63.9 31.29 21.6

10 Optimedia International 1,581 34.6 16.54 14.9

PERFORMANCE STATISTICS

Advertising Media buyers

agencies(1)

Operating profit margin(2) 8.5% 17.1%

Gross income (revenue) per head £90,927 £69,945

Average staff costs per head £50,779 £37,356

Operating profit per head £7,730 £11,815

Staff costs/Gross income 55.8% 53.4%

(1) Excludes TMP Worldwide from sample because of distorting impact.

(2)For media buyers the operating profit margin includes interest

received.

GROUP'S HIGHEST PAID DIRECTORS

Rank Company Director Latest Previous* Change

pounds pounds %

'000 '000

1 Abbott Mead Vickers Group Peter Mead 1,828 1,316 38.9

2 WPP Group Sir Martin

Sorrell 1,212 2,520 -51.9

3 The College Group A L Sandberg 909 710 28.0

4= Cordiant Communications

Group Michael Bungey 835 1,289 -35.2

4= Aegis Group Douglas Flynn 835 1,034 -19.2

6 M&C Saatchi Worldwide Not disclosed 817 295 176.9

7 Carlson Marketing Group

(UK) Not disclosed 808 388 108.2

8 Havas Group of Companies

in UK Not disclosed 780 2,118 -63.2

9 Chime Communications Lord Bell 719 798 -9.9

10 Saatchi & Saatchi Group Not disclosed 629 427 47.3

(*) Previous figures relate to the highest paid director for that

company in the previous year, irrespective of who that may have been.

TOP TEN GROUPS BY CASHFLOW

Rank Company Cash inflow

pounds '000

1 Cordiant Communications Group 24,500

2 BBH Holdings 6,997

3 Huntsworth 5,923

4 Golley Slater Group 4,008

5 DMB&B Holdings 2,312

6 The Imagination Group 1,913

7 M&C Saatchi Worldwide 1,337

8 G.H.A.Holdings 1,124

9 The College Group 1,033

10 OneMonday Group 954

This article was first published on campaignlive.co.uk

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