Tempus tunes in to pounds 13m profits

TEMPUS, THE independent buyer of television advertising time, yesterday posted a 40 per cent jump in profits to pounds 13.2m and set itself the ambitious goal of expanding twice as fast as the rest of its sector.

Shares in the media buyer, the third largest of its kind in Europe, edged up a penny to 257.5p in a falling market as results came in ahead of expectations, boosted by recent acquisitions in Europe.

Tempus has succeeded in building itself into a top-six player in all European markets, buying two rivals last year, Le Lab in France and MediaCentralen in Denmark. In a market that expanded by 4 to 5 per cent, Tempus grew organically at 2.5 times that rate, placing $4bn (pounds 2.4bn) of advertisements. It also began an expansion into the US, buying VSM Media in New York.

But as it expanded abroad, Chris Ingram, chairman and founder, faced a crisis at home. The UK arm of the group lost three crucial accounts in two years - BT, Lloyds TSB and Somerfield/Kwiksave.

Mr Ingram, still a 20 per cent shareholder, pruned a tangled network of 12 companies down to 4, cutting 30 jobs from a UK staff of 200. "There was a danger that too many people were caught up in the management of the business rather than servicing client needs. We've very much streamlined it now."

Mr Ingram said the group would look for more acquisitions in a rapidly consolidating market. But he rebuffed talk of a merger with WPP, which holds 18 per cent of Tempus. "The costs of being in this market are accelerating all the time and clients are demanding global service. We have no problems with entering a strategic alliance but I have seen nothing to show what strategic benefits a merger with [WPP] would offer."

Simon Lapthorne, an analyst at Granville, the investment boutique, said the UK business "seems to have turned the corner" and was well placed to expand in the US. But at yesterday's close of 257.5p, the shares are on a historical multiple of over 25 times, reflecting the sector's popularity. Too high to buy, but keep existing shares.