StockMarketWire.com - Insight and Communications Group Creston said headline PBIT grew for the three months to end-December compared to the strong prior year period.

There was a headline PBIT improvement in all three divisions.

The Group has also had a good recent new business performance winning some significant new clients and additional brands from existing clients.

Reported Group revenue for the year to date is flat, while Group revenue for the Period declined as expected by 3 per cent compared to the same period last year. On a like-for-like basis, Group revenue for the year to date declined by 7 per cent, and for the Period declined by 8 per cent compared to the same prior year periods.

Communications

The division grew its Headline PBIT for the Period compared to the prior year period despite the decline in revenue, which was principally driven by the cessation of a client's budget as previously reported in the prior year. The Board remains focussed on replacing this lost revenue, but this will impact the division's FY13 trading and as a consequence divisional revenue and Headline PBIT for the full year is expected to be lower than the prior year.

New business wins during the Period included the social media account for Durex, the division's first Reckitt Benckiser brand; a CRM programme across France and Portugal for Danacol, part of Danone; and, following work with EE and T-Mobile, the corporate and consumer PR for Orange.

Health

The Health division increased its reported revenue and Headline PBIT in the Period versus the prior year period, owing to the full quarter effect of The Corkery Group acquisition. For the full year, the division also expects reported revenue and Headline PBIT growth and this is despite a decline in like-for-like revenue in the Period versus the prior year period.

Creston said it is pleased with the integration of its latest acquisition DJM Digital Solutions, and the positive impact it has already had on creating and converting new business opportunities, particularly as part of an inter-agency team. Indeed, Creston Health has recently been appointed by Gilead to look after its Hepatitis C business across Europe and Australia. This puts in place the first major global piece of business to comprise all the Creston Health agencies, including DJM and the Group looks to build on this success with future client pitches.

Insight

The division's Headline PBIT showed a small increase during the Period against the prior year period, as a result of the management action taken earlier in the year and despite the expected decline in revenue. Quarter on quarter ICM continues to demonstrate progress and it has reported improvements in its Headline PBIT. Meanwhile the rest of the division had a strong Period, with both revenue and Headline PBIT growth compared to the prior year period and it is expected to continue delivering a strong performance into the fourth quarter.

Cash flow

Following a strong cash conversion, with operating cash flow ahead of Board expectations, the Group expects to be in a net cash position at the year end.

Save As You Earn (SAYE) scheme and share buyback

In January 2013 the Group launched a new three year SAYE share incentive scheme for its employees. In addition to supporting the retention and motivation of its talent, the Group believes the scheme is also beneficial in aligning the interests of its employees with those of existing shareholders. In order to avoid any dilution from the SAYE scheme, the Group will shortly commence a share buyback programme. The invitation to join the SAYE scheme closes on 8 February 2013 and the Group will update the market on the scheme's uptake and subsequent share buyback programme in due course.

Outlook

Creston said while it remains cautious in light of the macro-environment and on-going market volatility, the Group is pleased with the integration of its latest acquisition, DJM Digital Solutions, and the number of new business opportunities it continues to see and convert across the wider business.




Story provided by StockMarketWire.com