Media Perspective: Building up a strong presence in Asia will help bolster Aegis

Aegis' annual report is a jazzy number. And it's not often you can say that.

It's as if improved financial performance, the temporary cessation of bid speculation and the solid support of minority shareholders against Vincent Bollore's demands for board representation have emboldened its management to go crazy with the fonts and the silver and blue colour palette.

So we get artfully created left-hand pages to break up the numbers that contain nothing but statements such as "The age of mass media is here" and "How can we put our money where our word of mouth is?" There are also several pages covering corporate social responsibility, an absolute must in this day and age.

But never mind the bollocks. There are some stirring revelations to be found in this report. We learn, for instance, that the recently installed chief executive of Aegis Media, Mainardo de Nardis, trousered £841,000 for just over four months work during 2006 (including a £587,000 "walk-in" payment).

The report also grudgingly mentions the fraud allegedly perpetrated against Aegis Media and its clients in Germany, and reveals that it has written off £3.8 million as a result. It hopes to recover a proportion of this through legal action, but the damage may already have been done.

Generally, the report highlights a good year for Aegis; its pre-tax profits rose by 16 per cent, under capable management. Its digital strategy and investment through its Isobar network is moving in the right direction and, broadly speaking, it is trying to make its media operations "cleverer" (it increased its investment in its companies by 12.4 per cent as it spent on planning tools for Carat and Posterscope).

But while the report demonstrates just how far Aegis has come, it also shows just how far it still has to go. While it made great strides in growing its media offering in 2006 (in the process, Carat landed Campaign's Media Network of the Year award), it faces issues in both the US and Asia.

Aegis Media grew its revenues in the Americas last year by 12 per cent, but some observers predict that it has hit a wall there. Aegis management doesn't agree, and its Americas chief executive, David Verklin, has a strong reputation. Aegis needs more good news along the lines of the recent retention of Philips, given that its mantra is "to win and retain client mandates".

In Asia, Aegis Media is still a relative minnow (just £44.5 million in revenues) and though it claims to have continued to invest in its Vizeum network and took full ownership of its Carat China operation, it still has much to do in building a strong presence in the region.

If it can pull this off, it may keep Bollore at bay for quite some time yet