Marketing services group Hasgrove, which owns agencies such as Amaze, Interact and The Chase, has reported a pre-tax loss of £3m.
The group, which saw a profit of £1.1m in 2010, reported on its year-end figures this morning, with a headline operating profit of £0.9m, and a gross profit of £16.5m, both also down on the previous year.
However, the company also reported a significant reduction in its net debt, falling from £6.7m to £1.5m, as it refocuses its business offering towards digital services.
2011 also saw the sale of the group’s public affairs division Interel in July for €9.5m.
Paul Sanders, group chief executive, said: "The impact of the economic climate has meant a challenging year for Hasgrove. However, the Group's restructuring and focus on digital communications have resulted in improved controls and operational efficiencies which are already making an impact.”
He continued; "We are pleased to have significantly reduced our net debt and to be making good progress with client projects so far this year. More than 25% of the Group's expected profits for 2012 have been generated in the first quarter, substantially more than in previous years. Our confidence in the Group's potential is reflected by the doubling of the dividend."
Breaking down the performance of the business, Amaze, which last year saw the introduction of a new senior management team, led by CEO Natalie Gross, delivered an increase in revenues of £17.4m, alongside lower central costs on the previous year of £0.8m, generating a gross profit of £11.9m, down from £12.3m on the previous year due to delayed client spending and overruns.
The agency also picked up projects from clients such as Coats plc, East Coast Mainline and ODEON Cinemas, while opening a new office in London.
Intranet developer Interact delivered an increase of revenue of £2.5m, while its central costs were flat at £0.4m and its gross profits grew by £400,000 to reach £2.4m in comparison with the previous year’s total.
Projects came from G4S, Arriva, Yodel, UKAR (formally Bradford and Bingley and Northern Rock), Northampton NHS, Superdrug and Park Plaza.
Finally, The Chase saw its revenues decrease to £2.9m, while its operating profits fell to £0.1m and its gross profit was reduced to £2.1m, £800,000 down on 2010.
The first half year performance saw a loss of £125,000, leading to cost restructuring and improved client engagement across the rest of the year.
Looking towards the rest of the year, the board at the company has said that it is ‘pleased to see continued momentum’ in the average size of sales of Interact in both the UK and US, while also claiming that more than 25% of the group’s forecast profits for 2012 generated in the first quarter.