News & Press

Half Year Trading Update

31st July 2009

Hasgrove plc (AIM: HGV, ‘Hasgrove’ ‘the Group’), the pan European marketing and communications services group, is providing a trading update for the six month period ended 30 June 2009.  

Hasgrove plc (AIM: HGV, ‘Hasgrove’ ‘the Group’), the pan European marketing and communications services group, is providing a trading update for the six month period ended 30 June 2009.  

As previously indicated, the Group had a slower start than last year as a result of the economic conditions with clients deferring spending decisions.  However, Hasgrove is now gaining momentum following a number of notable new business wins and is anticipating a much stronger second half to the extent that the Board remains confident of achieving its full year expectations.

Hasgrove experienced a significant increase in new business wins, in excess of £2m annually, across the Group in May and June that will benefit the second half of the year and beyond.

During the first half Hasgrove expects to report gross income in the region of £13.2m (2008: £13.1m) which includes a £0.8m currency benefit year on year.  The Group anticipate reporting a pre-exceptional operating profit of approximately £1.5m (2008: 2.5m). Hasgrove has also continued to reduce its costs base during the first half, which is expected to have a full impact in the second half of the year. There will be an exceptional cost of £358,000 in the six month period to 30 June 2009 as a result of the cost reduction programme.

Despite the challenging first half, the Group has continued to invest in high growth areas such as Association Management and Digital and as part of this process has put in place incentives to ensure that key individuals continue to be motivated, with their interests aligned with shareholders.

Cash collection has continued to be an important focus which has resulted in a notable improvement over the last six months.  The Group has reduced net debt to £5.4m as at 30 June 2009 (30 June 2008: £7.5 million).  

The Group expects to publish its interim results for the period to 30 June 2009 in September 2009.

Rod Hyde, Group Chief Executive, said:

“We knew that the first half would be challenging and we have had to work hard to replace reduced retainers and have a concerted new business effort. We have also very actively managed our cash and cost base.

“I am pleased to say that this effort is now being rewarded.  We are confident that the second half will be strong and, on an annualised basis, we are now almost back to where we were last year, despite the fact that current trading conditions remain demanding.”