Next Fifteen falls into £4.2 million pre-tax loss on UK business writedown

Adjusted profits before exceptional items rose by 69%

Gideon Spanier
Tuesday 07 October 2014 15:07
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Public relations group Next Fifteen, whose clients include Google and Facebook, reported a half-year pre-tax loss of £4.2 million after it took a £7 million writedown on the historic value of its UK business.

But adjusted profits before exceptional items rose by 69 per cent and revenues rose 6 per cent to £52.2 million. Annual turnover in the year hit a record £101.5 million.

Chief executive Tim Dyson said digital content, data analytics and technology were three big growth areas. "You have to adapt or die," he said. "You have to realign your business model, while at the same time protect old revenue streams to fund new businesses."

Dyson added the rise of social media had been the biggest disruption the PR industry has seen in recent times as "everyone became a publisher, everyone became an influencer" but he felt the balance was shifting back to a degree as marketers recognise traditional media such as broadcasters and publishers still carry clout.

"People thought the media didn't matter," said Dyson. "But it's the combination of social and traditional platforms albeit in digital form that's so powerful."

Technology is increasingly important as clients are interested in clever ideas like "a piece if code" that could improve their communications.

Next Fifteen has also today bought US content ad agency Story Worldwide for $6.6 million (£4 million).

Dyson played down the non-cash writedown, pointing out it was an accounting adjustment because some of its UK agencies were deemed to have fallen in value, even though the group cannot claim an increase for other parts of its business.

"We don't need to be a bigger company," he added, when asked if Next Fifteen needed to be part of industry consolidation that has seen Engine Group bought by private equity.

"We represent Google and Facebook. They clearly don't think we need to be a bigger company. But do we think we could do more as a bigger company? Absolutely."

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