Anyone who thinks that businesses are easy to manage and that profits are easy to predict could learn a lesson or two from the results of two public companies in the marketing sector that reported this week.
Posts Tagged: Marketing Services Financial Intelligence
As each week passes, we hear more gloomy outpourings about trading prospects from the major groups in the industry. Huntsworth and Dentsu joined the gloomy chorus last week, countering Maurice Lévy’s attempt to cheer us up with news of better trading in October. Even those companies that are currently on target for the year feel the need to counsel caution about their future prospects – witness Chime Communications and Levy’s warning about December.
There is some evidence – but not a lot – that the stock market anticipates trends in economic activity, pruning back share prices when a downturn is expected and cautiously lifting those prices back upwards when better times are seen to be on the horizon.
Certain features are probably indisputable. First and foremost, Jonathan Stead is undoubtedly a good marketeer and proved himself able to build a substantial business.
If all goes to plan, by the end of June a majority stake in five of Chime Communications’ Bell Pottinger public relations businesses will have been sold to their management under the leadership of Lord Bell and Piers Pottinger.
It’s not very often in these gloomy times that there’s something to celebrate, but the good results announced by The Mission Marketing Group this week justify at least a modest cheer.
With a track record of losses like those shown in the chart below, one might expect the management of Canada’s MDC Partners to simply throw in the towel and admit defeat. At the very least one would be expecting more uproar from shareholders and some pretty tough talking with banks.
We may be looking forward to spring, but in economic terms we are still in the depths of winter. Weak companies, made more vulnerable by the cold winds of recession, have been eager to find warmer homes.
It’s almost irritating to see how Omnicom Group manages to report consistently steady growth in profits.
Seemingly unperturbed by being overtaken by WPP in the revenue league, Omnicom continues to deliver a reliably solid return to its shareholders. And that, of course, is what keeps investment institutions happy. While there is room in any portfolio for a few fast growth and/or speculative shares, the most critical component is a bedrock of solid and consistently performing ones.
Publicis is first out of the blocks with its results for 2011 and the figures look worth boasting about, although it would be premature to do so until the other global groups have declared their results too.