ADVERTISING agency M&C Saatchi was celebrating a successful first year on the stock market yesterday after signing contracts with Halfords and Royal Bank of Scotland.
The company, which floated last July, said a string of business wins in the UK had given it a boost as it posted an 8.5 per cent rise in pre-tax profits to £8.1m in the year to December 31.
A strong performance by its Asia Pacific division was the main driver behind the increase, while the group's US business returned to profit during the year.
M&C Saatchi was set up by Tory co-chairman Lord Maurice Saatchi and his brother, Charles, in 1995, after a dispute with shareholders of Saatchi & Saatchi, the advertising company the brothers created in 1970. It previously had a contract with car maker Rover.
The agency sounded an upbeat note about the new financial year. Chief executive David Kershaw said: "We continue to see good opportunities for organic growth and further international expansion and are encouraged by the new business performance in the current year."
A strong portfolio of business wins in the UK helped offset decisions by Rover and retailer Matalan to take work in-house in mid-2003.
During the year, contracts were signed with companies that included Privilege Insurance, which is part of the Royal Bank of Scotland group, and Halfords. Since the start of the year, M&C Saatchi has also won business with clients that include broadcaster ITV, Mini, Twinings and Ribena.
Operating profits in the UK fell to £4.3m, from £5.2m, as the group was hit by the cost of its flotation and investment in its European business. However, underlying profits at that operation were 3.1 per cent higher.
The Asia Pacific division increased operating profits by 39 per cent to £2.7m as it benefited from the first full-year contribution by new accounts.
M&C Saatchi said it would start looking for opportunities to expand its network of ten offices in the region.
It also said it had a good platform to increase its presence in the US and that it had made encouraging progress in target European markets, particularly in France and Spain.
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