Media Square cites 'unlawful conspiracy’ by Porta Communications CEO as factor for £1.4m pre-tax loss
Marketing communications group Media Square, which recently accused Porta Communications of ‘an unlawful conspiracy’ to takeover part or all of the group, has announced pre-tax losses of £1.4m and a 2% decrease in revenue for the first six months of its financial year. The 2% loss of £500,000 in revenue is put down to the ‘challenging trading environment’ in comparison with last year, although the group has also said that ‘prudent cost control’ has enabled the group to maintain its operating profit at the same level, with £1.1m and an operating profit of £0.7m. The group picked up work with Associated British Foods, Kraft, Dixons, Iron Mountain, Air Partner, Genworth, MTV, NHS, Santander and Unilever over the six month period and also appointed a new CEO for CST The Gate, with former global head of Brand for Aviva, Luke Mugliston joining and CMW appointing Liz Wilson, former managing director of Albion, also as CEO. The trading statement, made by Media Square CEO Peter Reid, also highlighted the hostile takeover bid and its legal proceedings against Porta Communications CEO David Wright, who sought to execute ‘an unlawful conspiracy’ which is says would have allowed Porta to back the acquisition of all or part of the Media Square Group. The statement, claims that the group incurred ‘significant exceptional costs’ in dealing with the matter and has now initiated proceedings to recover the losses it believed it sustained, allegations that Porta has denied. The group also announced a pre-tax los of £1.4m. “The Group continues to face challenging conditions and as previously announced the full year's operating profit will be below the level of last year. This uncertain macro outlook makes it all the more important that the Group successfully delivers on a long term solution to the historical debt position, given the potential pressure on its funding position going forward,” Reid concluded.