M&C Saatchi reports falling profit amid ‘challenging’ advertising market
The group said that it is on track to meet expectations this year.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Communications group M&C Saatchi said it was hit last year by a “challenging” market, which hit most businesses in the advertising industry.
The business saw its profit plunge in 2023, dropping by 87% to hit just £700,000 before tax, down from £5.4 million the year before. Revenue fell 2% to £453.9 million.
But the business said it was on track to meet expectations this year, after embarking on a cost-saving drive, which included measures to slim down its business.
The company sold part of its interest in its Swedish subsidiary, closed or wound down several smaller offices in Asia and exited some of its smaller businesses in the UK too.
This year the business sold its shares in three French investments and disposed of its shares in M&C Saatchi South Africa for £5.6 million.
That will be more or less the end of the plan to simplify M&C’s business portfolio, the company said, but executive chair Zillah Byng-Thorne said there is still “much more to do” in other areas.
2023 was a year of strategic progress. We have begun to transform into a leaner and more agile business laying the groundwork for sustained growth and improved profitability ahead
“2023 was a year of strategic progress. We have begun to transform into a leaner and more agile business laying the groundwork for sustained growth and improved profitability ahead,” she said.
“There is much more to do on simplifying how we interact with our clients and evolving our go-to-market strategy.”
During 2023, the business cut its annual costs by £3.9 million.
It has been a tough time for many advertising businesses. As the cost-of-living crisis squeezed customers’ wallets, they had less money left over at the end of the month to buy products they had seen in ads.
As a result, many companies have reduced their advertising spend during the year.
M&C said that while six months ago there were “early signs” that pressure was “easing on client marketing budgets,” this has now proven true.
“We delivered a materially better financial performance in the second half of the year, following the more challenging start to the year,” it said.