Creston profits grow despite drop in revenues

Insight and communications group Creston on Monday reported a rise in profits despite an eight per cent drop in like-for-like revenues for the last three months of 2012.

Group revenue declined by 3.0% for the quarter and sales were flat for the year to date. Like-for-like sales dropped 7.0% for the year to date.

However, profit before interest and tax (PBIT) grew during the quarter, driven by business from new and existing clients along with a headline PBIT improvement in the company's communications, health and insight divisions.

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The communications section increased its headline PBIT for the period even though revenues were down due to the termination of a client's budget.

"The board remains focussed on replacing this lost revenue, but this will impact the division's (full year 2013) trading and as a consequence divisional revenue and headline PBIT for the full year is expected to be lower than the prior year," the company said in a statement.

During the period Creston scored a new social media account for Durex, the division's first Reckitt Benckiser brand. The group also achieved a partnership with Danacol, part of Danone, for a customer relationship management programme across France and Portugal and with EE and T-Mobile, the corporate and consumer public relations for Orange.

In the company's health division, revenue and headline PBIT rose, thanks to the successful acquisition of The Corkery Group and DJM Digital Solutions.

The Insight unit experienced a fall in revenues but a small headline PBIT increase as a result of the management action taken earlier in the year.

"While we remain cautious in light of the macro-environment and on-going market volatility, the group is pleased with the integration of its latest acquisition, DJM Digital Solutions, and the number of new business opportunities it continues to see and convert across the wider business."

Shares were down 3.7% to 84.50p at 8:29 Monday.

RD