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FINAL RESULTS FOR THE YEAR ENDING 31 DECEMBER 2012. MARCH 2013. INTRODUCTION. CELLO – AN INTRODUCTION. We supply market research, consulting, and marketing support services to a blue chip client list in the pharmaceutical and other high margin client sectors
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FINAL RESULTS FOR THE YEAR ENDING 31 DECEMBER 2012 MARCH 2013
CELLO – AN INTRODUCTION We supply market research, consulting, and marketing support services to a blue chip client list in the pharmaceutical and other high margin client sectors Global infrastructure in Europe, USA and Asia High quality senior management team across Health and Consumer divisions Positioned at the advisory, value added end of the supply spectrum Best in class services and digital products (e.g. Pulsar, eVillage)
HIGHLIGHTS Gross profit up 5.3% to £65.1m (2011: £61.8m) Headline profit before tax flat at £7.0m (2011: £7.1m) Headline operating margin 12.1% (2011: 12.6%) Gross profit in Cello Health up 7.2% to £31.3m (2011: £29.2m) Like-for-like gross profit in Cello Health up 2.6% Headline operating margins in Cello Health 20.8% (2011: 20.9%) Second half profit recovery in Cello Consumer Full year dividend per share up 16.3% to 2.00p (2011: 1.72p) Net debt £8.7m (2011: £7.7m) Acquisition of Mash in January 2013
SEGMENTAL ANALYSIS Like-for-like gross profit growth - Health 2.6%; Consumer 0.6%
CELLO HEALTH 305 professionals Nine of top ten global pharmaceutical companies are clients Significant international reach (London, New York, Philadelphia) Strong habitual spending patterns from global clients Acquisition of Mash Health in January 2013
CELLO HEALTH GROWTH % of Group Revenues from Cello Health % of Group revenue outside the UK
CELLO HEALTH CLIENT BASE • 49% of gross profit, 68% of operating profit • 9 of top 10 pharma • 22 of top 25 pharma • 31 of top 50 pharma • Excellent client continuity
CELLO HEALTH CAPABILITIES Full Year 2012 Gross Profits
CELLO HEALTH – DEVELOPMENTS IN 2012 Formation of Cello Health Board Establishment of centrally funded new business team Significant investment in new geographies and new offerings
CELLO HEALTH PLANNED DEVELOPMENTS IN 2013 Integrated client facing brand structure First full year of centralised new business activity Continued support of investment initiatives Additional US expansion Expansion in Consumer Health with acquisition of Mash
CONTINUED CONSOLIDATION IN HEALTHCARE MARKETING SERVICES (backed by Symphony Technology Group) (backed by Thomas H Lee Partners) (backed by TPG Capital)
CELLO CONSUMER 51% of gross profit; 32% of operating profit 450 Professionals Blue chip multinational client base in FMCG, mobile telephony, gaming, retail, financial services and charities Largest client = 4% of gross profit Presence in UK, San Francisco, Los Angeles, New York, Hong Kong and Singapore Cutting edge social media tools Cutting edge web marketing capability
CELLO CONSUMER CAPABILITIES Full Year 2012 Gross Profits
CELLO CONSUMER – DEVELOPMENTS IN 2012 Formation of integrated board structure Consolidation of sub-brands into four primary ‘engines’ – Leith Group, Bright Group, Face and 2CV Ongoing reduction in surplus headcount and excess space Investment in digital social media and software capabilities – Pulsar and Communities tools Overseas push – USA and Asia
CELLO CONSUMER PLANNED DEVELOPMENTS IN 2013 • Rebranding of Cello Consumer as client facing brand • Focus on digital and social media front end • Continued investment in existing and new overseas offices • Continued focus on margin improvement