Latest agency results point to improved profit margins

C&I industry profits have increased dramatically, according to a benchmark analysis of agency results from Companies House. The most recent financial data submitted by agents for 2005 shows a boost in overall pre-tax profits to £19.3m, compared with £3.9m in 2004. The results – analysed by accountancy firm Brett Howell Associates – also show a 3.5% rise in turnover, from £588m to £609m in 2005, plus a 4% rise in gross profits, from £150m to £156m. Agencies contributing to this huge increase in pre-tax profits included The Grass Roots Group, Universal CIT and full-service agency Concerto Group, which moved to pre-tax profits of £201,335 from a £201,590 deficit last year and a £531,951 deficit in 2003. CEO and group finance director of the London-based Concerto Group Mark Greaves put part of its success down to increasing confidence in the live-events sector. “There seems to be a growing realisation among corporates that live events offer better value for money than traditional corporate hospitality,” said Greaves. “Plus in an age of email and internet, there is no substitute for face-to-face meetings and getting people together.” Greaves attributed the figures from Concerto to several strategic decisions within the group since 2001. “We’ve been streamlining our group offering so that it is more appealing to corporates,” he said. “This has included merging parts of the business and refining or getting rid of loss-making elements within the group.” However, Oxford International managing director John Walker does not believe that the statistics are an accurate portrayal of the industry. “They’re just bottom line facts reflecting results of a bunch of companies 18 months ago,” he said. “They don’t tell us how the industry’s doing now nor how it will be performing in 18 months. Business was great last year, but this is one of the most volatile periods we’ve ever been through.”

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