Chime profits up 25% with cheery outlook for 2008

LONDON - Chime Communications has reported a rise in pre-tax profits of 25% to £13.8m for 2007, and said that it sees no slowdown in growth for 2008.

The company, owner of ad agency VCCP and PR agencies Bell Pottinger and Good Relations, reported its profit margin improving by 0.6 percentage points to 16.3% and organic growth climb by 11%. Its advertising and marketing services division delivered the strongest rise in profits, up by 68% to £5.9m compared with 2006.

Lord Bell, chairman of Chime, said that strong growth in the first quarter belied the talk of a recession.

"I'm surrounded by gloom mongers saying there's going to be a downturn but I don't know anyone with any of it," he said. "There's no pressure on fees or budgets and we've had a record January.

He also pointed to the positive results of rivals WPP and Havas as evidence of a mismatch between what is going on in the money markets and in the wider economy.

Chime's share price has been hit by the stock market jitters over the past couple of months but this morning it was up slightly after a number of trades, at around 31p, compared with yesterday's close of 30p.

Earlier this week, Bell Pottinger chairman Peter Bingle said that the agency had rejected an approach to work for the Zimbabwean government. However, Chime does count deposed Thai Prime Minister Thaksin Shinawatra among its clients.

Other successful pieces of business it worked on in 2007 included representing Mark Warner Holidays during the coverage about missing child Madeleine McCann, launching PlayStation3 and relaunching the Millennium Dome as The O2.