Aegis’ figures for last year were not as bad as they have been. Profits, 21.8 per cent down, hardly inspire confidence, and at best ad revenues for the industry will remain flat this year.
Aegis says 2010 has started well. While this is encouraging, it’s not time to put the champagne on ice just yet. Newspaper publisher Mecom saw an eight per cent slip in revenue in February, reflecting the volatility in the market.
The biggest disappointment for Aegis shareholders yesterday was the apparent end to long-running hopes the firm would merge with French rival Havas. The chance it offered for rapid expansion had shareholders salivating. But chairman John Napier poured cold water on the joint venture and the bond issue appears to be the final nail in the coffin.
Despite this, the bond issue was seen as a success. It was over subscribed, raising the firm £190m – far above the £170 it had planned. But even this comes with a downside – it means the maturity of its debt has increased and interest payments will almost certainly be hiked in response.