Strong momentum maintained
Aegis Group plc (“Aegis” or “the group”) today announces a trading update for the first quarter of 2012, from 1 January 2012 to 31 March 2012.
The positive momentum demonstrated by our business over the course of last year has continued into 2012, with total group revenue for the first quarter up +16.3% on 2011, in constant currency, and +17.0% at reported rates. Aegis delivered organic revenue growth of +8.1% in the first quarter, a strong performance particularly against our sector-leading organic revenue growth performance in the same quarter last year:
|Organic revenue growth (%)
Aegis Media delivered organic revenue growth of +8.0% during the first quarter, driven by continued strong momentum across our network brands.
The Americas produced organic revenue growth of +20.3%. Our performance in the region benefited from an outstanding new business record in North America over the last two years, as well as continued strong results from our market-leading digital business in Brazil.
The Asia Pacific region delivered organic revenue growth of +12.5%, supported by another excellent performance from our business in China.
In EMEA, organic revenue growth of +1.7% was against prior year comparatives of near double digit growth. There were good performances from our businesses in Russia and northern Europe, whilst southern Europe continued to face challenging market conditions.
Aegis Media achieved total net new business wins of $2.9 billion (2011: $1.6 billion) during the first quarter of the year, $2.5 billion of which results from our contract with General Motors Co. (“GM”). This new business win has only just come into effect in the second quarter of 2012, so did not impact our organic revenue performance in the first quarter of the year. Other new business wins during the first quarter included Philips TV in France, Bulgari in Italy, Lenovo and Pfizer in Russia, Woolworths in South Africa, Kraft in East Africa and Beiersdorf in China.
The group will continue to target acquisitions which provide scale, innovation and infill, with a focus on faster growing regions, North America and digital. During the first quarter, we made a number of digital acquisitions and investments, including Roundarch in North America, Upper Storey in Singapore and eLink in China, and we acquired an out-of-home agency, PPI, in Hungary.
Aztec delivered organic revenue growth of +10.0%, supported by another good performance from our business in Australia, as it continued its recovery over the last few quarters.
Group financial position
Aegis ended the period in a robust financial position, comfortably within its financial covenants, with significant undrawn capacity under its committed central facilities.
Our clients’ marketing and advertising expenditure so far in 2012 has been resilient and their budgets for the remainder of the year retain growth. This is expected to support the continued momentum of Aegis, which has been building over the last 18 months.
Following our encouraging start to the year, highlighted by the GM new business win, which has yet to benefit the Group’s numbers, we remain confident about Aegis’s prospects for 2012. Our expectation is to continue to deliver sector-leading organic revenue growth and an improvement in underlying operating profit, year-on-year.
Jerry Buhlmann, Chief Executive Officer of Aegis Group plc, said:
“In the first quarter of 2012, which was our first full quarter as a focused media and digital communications specialist, Aegis delivered excellent organic revenue growth, particularly in the face of a sector-leading top line performance in the prior year period. All of our network brands performed well across our key regions, highlighting the continued positive momentum in our business.
“Our unique operating model and focus as a scaled media and digital communications specialist, fully aligned to the requirements of our clients in a rapidly-changing media environment, ensures that Aegis remains very well positioned for continuing success.”
For further information please contact:
|Aegis Group plc +44 (0) 20 7070 7700
Rob Gurner, head of investor relations
Louise Evans, director of communications
|Tulchan +44 (0) 20 7353 4200|
James Macey White