Taylor Nelson warns of falling demand for bespoke research
A fall-off in orders from companies wanting customised market research yesterday forced Taylor Nelson Sofres, the world's fourth largest market researcher, to warn investors last year's profits will scrape the bottom end of City forecasts.
David Lowden, the finance director, yesterday said turnover for the year was flat and the group had missed its profit margin growth target of 0.5 per cent.
The news sent shares falling 6 per cent to close at 142.5p, down from a 12-month peak of 247.5p in May. The Anglo-French group said organic growth had been difficult to achieve as its clients, feeling the pinch on their spending budgets as poor economic conditions take hold, stalled on ordering new projects during the second half of last year. A bout of acquisitions have helped Taylor see some profit growth, but profits are expected to come in at the lower end of expectations, which were in the range of £46m to £52m before tax.
The group's syndicated research services, such as its tracking of consumer goods purchases that supermarkets buy to assess their market share, has continued to provide a steady income stream. But one-off projects based on new products or advertising have slowed significantly in the second half. The company has also lost major contracts with Andersen, WorldCom and NTL. Mergers in the healthcare sector have also hampered new research commissions.
Mr Lowden had little cheer for the outlook, saying any growth was dependent on an economic recovery.
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