Profits slide at Hasgrove

MEDIA group Hasgrove has seen profits more than halve after the loss of a number of contracts.

In the six months to June 30, the Manchester-based group saw pre-tax profits fall from £1.9m to £804,000. Turnover fell from £16.4m to £15.9m.

The group said as a result of the economic downturn, it has lost more than £2m of retainer and project work, and has axed 21 employers which resulted in £1m of annual cost savings.

Hasgrove has also streamlined the business into two operating divisions – public affairs and strategic communications, and digital and communication services.
Public affairs and strategic communications saw operating profit fall 64% to £400,000. The group said the fall was accentuated by a compulsory salary indexation in Belgium of 4.5%.

It said a number of steps to cut cost had been taken including the loss of eight staff.

The digital and communication services saw operating profit fall to £1.3m from £1.8m.

Hasgrove chief executive Rodd Hyde said: “We had a slow start to the year with the sales cycle being extended for large projects and margins impacted by pre-sales activities. We have focussed on integrating further our businesses into two main streams as well as controlling costs.

“Despite the testing economic conditions, we have won significant assignments in digital, association management and corporate communications during the last few months. On an annualised basis these recent wins will more than make up for the lost revenues earlier in the year and position us well for 2010.”