Writtle half year report and dividend announcement
CHAIRMAN’S STATEMENT
I am pleased to report on our performance for the first half of the year.
Overall, it was a better trading period than in the prior year, with increases in both turnover and profit. However, the outcome masks fluctuations in performance within our business groups, with poor trading at Seymourpowell and Fero being offset by strong results from Epoch and Arken. The review of trading below presents the performances of our business groups, all of which were profitable.
RESULTS AND DIVIDENDS
Turnover increased to £37.31m (2023: £34.23m) and headline profit before tax rose to £1.41m (2023: £0.80m). Exceptional costs of £0.44m and goodwill amortisation of £0.35m reduced profit before tax to £0.57m (2023 £0.08m).
Net cash at 30 June 2024 was £4.95m (2023: £6.21m)
With improved trading and strong cash balances, an increased interim dividend of 8.00p (2023: 7.00p) per share will be paid on 25 October 2024 to shareholders on the register at 12 September 2024.
REVIEW OF TRADING
The performance of our three business groups is shown on page 8 of this report.
Unusually, our Innovation businesses were the weakest contributors to group profit. Seymourpowell lost a major revenue stream from a client at the end of last year, and most of its first half was spent restructuring operations. This process is now complete and monthly profitability has been resumed. Epoch and The Team both performed admirably but could not fully offset the revenue decline at Seymourpowell so overall turnover in this business group fell by 16% and profits reduced by £0.78m.
Our Implementation business, BRANDED, enjoyed a good first half with turnover increasing by 13% and profit almost doubling from the prior year. The US operation is now firmly established with a growing client base and has recruited a US-based creative director to meet the rising demand. BRANDED also achieved B Corp Certification across its businesses, capping an excellent six months.
Our Instore businesses saw a big improvement over prior year, with turnover up 25% and profitability restored after last year’s first half losses. The upturn was driven by an outstanding performance by Arken which continued its upward momentum from the second half of last year. Several of its clients initiated major projects in the UK and Continental Europe. Fero faced a more challenging first half as it worked to replace turnover from its prior year client loss. I am pleased to report that Fero’s efforts have been rewarded with significant revenue streams secured from three new clients. Prospects for Instore in the second half are good.
CORPORATE ACTIVITY
Opportunities continue to present themselves and we engaged in detailed discussions with two potential acquisitions in the first half. While there is still some way to go, discussions are ongoing and we hope to be able to report a successful outcome.
CURRENT TRADING
Our traditionally stronger second half has started well. We remain cautious in the face of political and economic uncertainty but expect to deliver another satisfactory year.
Robert Essex
Chairman
12 September 2024