Geoff Howe realises one of his most valuable assets
Marketing entrepreneur Geoff Howe may have realised his most valuable business asset when his company sold its US operations to WPP Group last month.
The US subsidiary Geoff Howe Marketing Communications made a post-tax profit of £372,919 in the year to 31 March 2009, following a more modest profit of £99,348 in the previous year. Although the results of the various marketing agencies controlled by Geoff Howe and based in Hampton, Middlesex, are not consolidated, it would appear that the US business was the most profitable in each of those two years.
The core UK agency Geoff Howe & Associates actually suffered an operating loss of £260,226 in the year to March 2009, but this was offset by income from its highly profitable Bristol subsidiary Tiger Red Partnership that made £331,735 in that year.
Terms of the US deal have not been disclosed and it is difficult to guess what WPP may have paid for the business, particularly as the deal included the European client Hills Pet Nutrition and certain other non-US assets. Furthermore the financial results for the latest year have not been published yet. However, WPP said that Geoff Howe’s US revenues for the latest year were over £4 million, implying that post-tax profits are likely to have increased to somewhere in the region of £400,000. That would put a value on the US business of at least £4 million – being a multiple of one times revenues. Anything paid on top of that for the peripheral assets would be a nice bonus.
Meanwhile Geoff Howe retains a controlling interest in all of his UK businesses.
© Fintellect Ltd