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M&C Saatchi PLC on Thursday posted a steep decline in first-half profit, citing subdued activity in Australian and UK markets. The London-based advertising and communications agency said pretax profit in the six months ended June 30 fell to £4.3 million, less than half the previous year’s £10.8 million figure. Revenue was down 13% at £173.4 million from £199.5 million on-year, as billings dropped to £202.3 million from £244.0 million. The firm cut staff costs by 6.5% to £75.8 million from £81.0 million, noting redundancy costs across nine of its businesses during the first half. ‘The next stage of the group’s global efficiency programme has continued to identify and reduce specific central HQ roles, which will be replaced overseas to save cost,’ M&C Saatchi added. The company held a cautious view for the remainder of the year: ‘The outlook for the rest of 2025 remains soft, driven by continued macro volatility and subdued market conditions in Australia and the UK, offsetting stronger demand in Europe, the US and the UAE.’ M&C Saatchi underlined weakness in its its core Australian market, where it has taken a hit from hesitant campaign spending, ‘particularly with consumer-facing businesses as well as annualisation of client losses.’ Net advertising revenue slipped 9.5% to £33.9 million from £37.5 million a year earlier. The ad agency said the decline would have been 2.5%, if not for the impact its ‘very weak’ Australian business. Lower net revenue also reflected the sale of its South Africa businesses in 2024, the company said. M&C Saatchi shares fell 6.3% to 156.95 pence on Thursday morning in London. Looking ahead, the company forecast an annual revenue decline in the mid-single digits, on a like-for-like basis, ‘despite the improving H2 pipeline momentum.’ Full-year profit is expected in line with the previous year. Statutory pretax profit was £18.1 million in 2025 and £30.5 million on a like-for-like basis. Statutory revenue was £395.4 million in 2025, and like-for-like revenue was £392.5 million. Chief Executive Zaid Al-Qassab said: ‘While we expect continued macro uncertainty in the second half, we will focus on what is in our control, aiming to deliver on the improving pipeline momentum. In the medium term, we continue to improve our operating model, and the strength and diversity of our portfolio, meaning we are well-positioned to deliver on our growth ambitions and to create value for shareholders.’ Copyright 2025 Alliance News Ltd. All Rights Reserved.
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