Research jobs go at Photon as group reacts to budget cuts

AUSTRALIA-- Photon Group has axed 17 research jobs as it looks to reduce costs to deal with a slowdown in research spending.

The marketing services group revealed the cuts today as one of a number of initiatives to deal with the difficult economic climate.

Photon's strategic intelligence group – the division which houses research agencies The Leading Edge and Jigsaw, and communications strategy and planning firms Naked and Bellamy Hayden – reported net revenue of $38.2m for the six months ending 31 December.

This was up 131% on last year's $16.5m – thanks largely to the acquisition of Naked in February 2008. Earnings before interest and tax was $4.1m. Total group net revenue was $221.6m.

Photon CEO Matt Bailey said growth was “solid” across all five divisions. “We achieved exceptional growth in field marketing, public relations and internet marketing as these areas, which together account for 75% of our earnings, received a greater share of marketing budgets.”

However, he added: “Some of our businesses specialising in events, research and high-end digital marketing did it tough as projects were cancelled or delayed. We have adjusted our cost base in these businesses, reflecting a view that it could take some time for these areas to recover.”

As well as the research job cuts, Photon revealed it had also ended its “unprofitable” joint venture relationship with the DVL Smith Group.

Photon was a 51% shareholder in the group, which was formed in 2007 as a partnership between DVL Smith Ltd in London and Strategic Intelligence Group in Melbourne.

Founder David Smith told Research today: “In the summer of 2008 a very amicable decision was reached with Photon, that meant that the two companies that made up DVL Smith Group would revert back to operating as individual companies.

“It became clear that operating two separate offices – one in Europe and one in Australia – was just not working, so I am delighted to be back running DVL Smith Ltd as a successful and profitable operation out of our Dockland's offices.”

John Marinopoulos, Smith's co-director of the DVL Smith Group, continues to head up Strategic Intelligence Group as managing director.

Author: Brian Tarran

Related links:

Photon sees ‘softness' in research market

Derek Leddie steps down at Photon Group

Photon Group backs resurrected DVL Smith