Illuminas remains ‘strong' and ‘profitable'

UK-- Marketing services group Media Square has reported a “dire” first half performance – but its research agency Illuminas remains “strong” and “profitable”.

Although Media Square did not break out figures for Illuminas in its interim results, comments made by director Mike Roderick suggest the agency has continued to deliver the goods, following organic profit growth of more than 300% last year.

Roderick told Research: “We are still very much a strong and profitable part of the group.”

As a whole, however, Media Square's turnover was down 14% to £85.3m, while revenue fell 16% to £43.3m.

The group reported an operating loss of £17.4m, although much of this was due to a £16m write-down of goodwill, largely on the Huntsworth marketing services businesses acquired in late-2005 (of which Illuminas was one). The rest came from restructuring costs and trading losses.

Executive chairman Roger Parry summed up Media Square's results as “dire”. He said the company had been through “a torrid time”.

“It made too many acquisitions too quickly and now the metaphorical chickens have come home to roost in the shape of poor trading, large restructuring costs and a significant write-down of goodwill.”

Parry said “an over-aggressive acquisition strategy, an under-managed operational integration effort and years of corporate confusion” were to blame for the group's predicament.

A strategic review – initiated when he joined the company in July – has led to Media Square reorganising into three divisions: advertising and PR; marketing; and design. Illuminas sits within the advertising and PR division, which is headed by CEO Philip Gregory.

Author: Brian Tarran

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Illuminas ‘strong performer' in Media Square's first half results