HRG reports mixed bag in half-year results

The first six months of 2007 threw up a mixed bag for Hogg Robinson Group (HRG) according to its latest half-year results. Overall revenue was up on the same period last year, while profits fell, but the group claims that like-for-like performance was positive. Overall revenue for the group came in at £154.4m for the six months to September 30, up from £149.2 year-on-year. This was largely due to North American performance, which was up 11% to just under £30m, while the European operation slipped 2% to £109m. Overall operating profits for the period fell to £10.7m from £16.8m – but this is cushioned to an extent by the fact that HRG put the 2006 figure at £12.8m after exceptional items were considered. In terms of earnings before interest, taxation and amortisation (EBITA), figures for the six months to this September were again down (from £15.1m to £13.2m). However, adjusted EBITA figures presented by HRG show this year’s results come in at £14m, up from £12.3m in the same period last year. The explanation given for these adjusted figures is one-off earnings last year from the football World Cup and exceptional expenditure this term on its European restructure. Part of that restructure has seen HRG put a renewed focus on events, and August saw it install former EBA managing director David Battley in the new role of director (events and meetings management). But while HRG chief executive David Radcliffe said that the restructure – originally forecast to cost £3m – was currently on course to come in under budget, he was cautious in his outlook for the next six months, hinting that events business could be hit by economic uncertainty. “HRG delivered an encouraging first half performance, showing, on an adjusted basis, growth in revenue and EBITA,” Radcliffe said. “These factors give us confidence for the full year outturn and beyond [but] we are watching current market developments including continued turbulence in the financial markets and the price of oil. Some, mainly financial sector-based clients are looking to us to help design cost saving travel policies as they seek to reduce the impact of these issues. In addition, we have seen recently in some countries signs of softening demand relating particularly to SME and events.”

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