Illuminas escapes Media Square job cuts

UK-- Marketing communications group Media Square is to axe 9% of its global workforce in the face of lower spending from clients – but its Illuminas market research business will not be affected.

In a trading update for the current financial year – which ends 28 February – the group said it had been notified of some “significant reductions in spending plans” by clients in the automotive, retail and financial services sectors.

In response to this, Media Square said it would cut costs through reductions in headcount and overheads. However, Illuminas chairman Peter Reid told Research the agency would not be affected by this restructuring and that the business had performed well over the last year.

“Rather than focusing on the gloom, we continue to focus on providing clients with high value strategic research and this has helped us grow the business over the past year, despite the worsening economic environment,” he said.

Looking ahead, Reid said: “We think we are well placed for the next twelve months. We continue to make selected hires in areas where we can improve our service to clients and have recently won a number of new strategic briefs”.

Media Square – which also owns advertising, design, PR and marketing agencies – said that the lower client spending patterns seen in the fourth quarter would likely cause full-year operating profits to come in “just below market expectations” before restructuring costs were factored in.

However, the group expects its cash balances and net debt position to be ahead of expectations because of good operational cash flows and the recent sale of certain non-core assets of Illuminas.

Author: James Verrinder

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