Trading Statement

LONDON--(BUSINESS WIRE)-- 

Next Fifteen Communications Group plc

("Next 15" or "the Group"),

Trading Update

Next Fifteen Communications Group plc issues the following trading update in advance of the Company’s Annual General Meeting to be held at 1pm today. Following the meeting, Tim Dyson, Chief Executive Officer, will deliver a presentation which will also be made available on the Company’s website www.next15.com.

Impact of Covid -19

Next 15 is pleased to report that, despite the impact of Covid-19 on the marketing industry, it expects to deliver modest growth for the first half of this financial year at both the revenue and profit levels. The company’s balance sheet also remains strong with net debt currently standing at approximately £5m. Overall trading remains consistent with the update provided in April, the new business pipeline remaining largely positive with a number of new assignments being won recently including work from Ernst & Young, the World Health Organization, Photobox and Sainsbury’s Argos as well as additional assignments from Amazon, Google and Salesforce.

The Group believes it has done a good job in managing the impact of Covid-19 as it relates to our people, our customers and our business performance. Many of our senior management team along with the board, are taking salary reductions, and some staff are being furloughed. The move to working from home was managed seamlessly and we have progressed a series of initiatives that have focused on emerging from this crisis with healthier operating margins. As can be seen by our current level of net debt, we have also focused heavily on cash conversion.

However, we still feel it is prudent to assume that any real recovery will not be seen until the latter part of the fiscal year. The group has remained relatively insulated from the impact of Covid-19 on the economy. This is in part because of our geographic spread, in part because of the limited exposure we have to highly affected areas such as travel and hospitality and lastly because over half of our revenues come from the technology sector. We think this client, product and geographic mix will be important as we emerge from the economic impact of the pandemic.

Balance sheet strength
As mentioned earlier, the Group has maintained a very healthy balance sheet through this cycle. Given this, the Group expects to return to making selective acquisitions which will extend our engagement in business innovation and marketing technology businesses. We also recognise the importance of paying a regular and sustainable dividend to our shareholders and are reviewing when to resume payments.

ESG
Lastly, the Group has been exploring implementing a new ESG framework to accelerate our goal to become carbon neutral. The Group believes that the right framework would support our current, already evolved DE&I activities. Our talent is by far our most important asset and the urgency of these initiatives has been reinforced by the recent Black Lives Matter protests and the response these events have had from our employees. One such framework being considered is B Corp status for Next 15 and/or its operating businesses. We will update shareholders on this topic when we announce interim results.

Enquiries:   Next Fifteen Communications Group plc Tim Dyson, CEO [phone] Peter Harris, CFO [phone]   Numis Mark Lander, Hugo Rubinstein, Nick Westlake, [phone]

 

Category Code: TST

Sequence Number: 702553

Time of Receipt (offset from UTC): 20200624T181931+0100