One of the City’s leading public relations bosses has blamed what he said was the worst year for financial PR in a decade for a slide in profits, describing conditions as “trying to walk up a down escalator”.
Operating profit at Tulchan Communications tumbled more than 15% to £2.7 million in the year to March with revenues down 8.4% to £7.6 million, the second year of declines in a row.
Founder Andrew Grant, whose agency represents FTSE clients such as Ocado and Mothercare, said the period had been a nadir for financial PR in London.
“If you look at everyone’s numbers across the industry, there’s no doubt that the period was the most difficult in a decade,” declared Grant, noting mergers and acquisitions were at low levels and the market for initial public offerings was “firmly shut”.
Financial PR is often seen as a City bellwether because activity tends to move ahead of the stock market and Grant said conditions improved at the start of 2013.
“This year is well up,” he continued, referring to how Tulchan worked for Royal Mail and Merlin for their IPOs.
His agency has also advised Cooperative Group throughout the recent crisis surrounding its shamed ex-bank chairman Paul Flowers and its bailout.
But Tulchan has suffered from client losses, including Marks & Spencer and G4S. Grant, who quit rival Brunswick to found his agency in 2000, said the rise of Twitter was revolutionising financial PR.
“The change is remarkable. The commentary starts earlier and finishes earlier — it’s more concentrated and intense,” he said, referring to the burst of activity on Twitter in the minutes after a 7am stock market announcement.
“The Twitter reaction is the equivalent of a share price reaction,” he added, although they are “two different markets” as the share price can defy sentiment on social media.
Grant’s pay fell by £100,000 to £600,000, after hitting £1.6 million in 2010-11 — a record year.