Operating profits rose more than 30 per cent at Cordiant
Communications Group, the parent of Bates Worldwide, in the six months
to 30 June. But the UK proved the weakest link in the chain, with
revenues virtually flat and an 18 per cent decline in profitability over
Revenues at Cordiant in the UK climbed only 2 per cent to pounds 19.9
million, while operating profits fell to pounds 2.6 million from pounds
3.2 million. However, this, and a flat performance in Asia, was more
than offset by a near doubling of profit contributions from continental
Europe as major new assignments, especially Bates’ Seat win, began
The chief executive, Michael Bungey, said the UK’s results were affected
by two one-off projects in the previous year at Cordiant’s events arm,
HP:ICM, but also admitted Bates UK could do better.
’There have been times when they have won a lot more new business than
now,’ he said, adding that its recent restructure had provoked a
short-term period of inward focus. However, Bungey expected the benefits
of the reorganisation to be felt next year.
He reiterated Cordiant’s promise to raise operating margins on the
business, which includes Scholz & Friends, half of Zenith and other
smaller specialist groups. Margins came in at a relatively modest 6.7
per cent in the first half, but should rise to 10 per cent for the full
financial year and 11 per cent in the year 2000.