Aegis sees earnings slide 20%

Aegis Group, the advertising buying firm, yesterday reported a 20 per cent fall in pre-tax profit to £27.2m and declined to predict when the sector might recover. It recorded a 17 per gain in revenue to £248m, but saw earnings slide due to expansion costs and reversals in Argentina and the US.

Doug Flynn, the chief executive, said no signs of a pick-up had emerged but he expressed hope for 2002: "It would be quite an amazing situation if by the middle of next year there wasn't a pick up. It started last October. It's been a long slump." The firm, which negotiates advertising for clients such as Philips and Renault across more than 40 media markets, gained share even while business levels were slumping. Billing revenue, which include monies paid on to advertising outlets, grew 8.3 per cent to £3.05bn.

Mr Flynn dismissed reports that some Aegis executives were anxious to explore a merger with WPP Group. "Not a single person in the company has come to me and suggested we (talk to) WPP."

The industry's worsening climate saw Aegis cut 181 jobs in the first half, out of a workforce of 6,000.

The shares rose 2.25p to close at 88.25p yesterday.