Published: 08:00 21.07.2005 GMT+2 /HUGIN /Source: LB Icon AB /SSE: ICON /ISIN: SE0000476962
STRONG SALES GROWTH AND STEADY MARGIN IMPROVEMENT CONTINUED
LB Icon AB (publ.); report for the period January 1 - June 30, 2005
AMSTERDAM, the Netherlands / STOCKHOLM, Sweden - July 21, 2005.
LB Icon AB (Euronext Amsterdam, OMX Stockholm: ICON) ("LB Icon" or "the Company"), the internationally active full service company offering an integrated approach of business & brand strategy consulting combined with marketing & communications, and digital technology services today reported its first half year results.
Highlights first half 2005
- Net sales growth 54%, organic growth of 7.3%.
- Sales per employee (annualized) up 24% to EUR 118,000.
- Continued profitability and increase in profit margins.
- Acquisition of Wheel in the UK and DAD in Belgium position LB Icon as market leader.
Robert Pickering, CEO of LB Icon on business performance and outlook
"The results of the first half and more in particular the second quarter provide further evidence that our Company is on track to strong and profitable operations for the year. I am particularly pleased with our organic growth levels and the continuing steady improvement of our profit margins.
Adding to this overall improvement of our business performance we acquired Wheel in London in the first quarter and DAD in Brussels in the second quarter making us the #1 digital marketing and interactive technology company in the UK as well as in the Benelux. The acquisition of Wheel in London and DAD in Brussels are both strategic to the market positioning of the Company.
We remain positive as to the outlook for the full year. We expect to continue our focus to improve our margins and increase net sales organically. We will also evaluate further growth opportunities through possible acquisitions or mergers. As we have demonstrated, we will only pursue M&A opportunities that are accretive to our results and further establish LB Icon as Europe's market leader."
OPERATIONAL REVIEW
In all key markets service offering to existing clients has been expanded and in addition the win ratio on new business also with new large accounts has increased. The customer base consisting of national and internationally leading companies is stronger and more diversified than ever before.
Again, these are positive signs of companies and organizations moving more and more towards interactive business, willing to explore new markets and new distribution channels urged by the continuously growing opportunities offered by the digital medium.
LB Icon's reputation and market recognition is growing stronger. Large companies with a need for a new positioning and strategic focus on doing business in a multi-channel environment will make the choice for agencies like LB Icon with an international network of companies and a proven track record in combining innovative business & branding strategy with marketing & communication and usability of new digital technologies.
Next to the first quarter acquisition of Wheel in the UK, LB Icon acquired Digital Age Design (DAD) located in Brussels, Belgium in the second quarter. With currently 63 professionals and annual net sales exceeding EUR 7.2 million, DAD is the leading digital marketing, communications and technology company in Belgium. DAD is highly complementary to the Group's other existing operations, particularly in the Netherlands. It is managed by an experienced group of professionals that will lead the Group's expansion in Belgium and will contribute to the further extension of the Group's Pan-European service offering.
The consideration for DAD consisted of cash (EUR 2.3 million), shares (EUR 2.3 million) and an earn-out payable in shares. Most of the earn-out is dependent on EBIT measured over a 12-month period. Upon acquisition other intangible fixed assets (trademark and client portfolio) were recognized at EUR 1.1 million that will be depreciated over 3 - 5 years. DAD is consolidated into the Group's results as of May 1, 2005.
As announced last quarter, LB Icon is continuously evaluating the contribution of each entity and key market to the overall long-term growth and profitability of the Group. Non-core assets or entities will be divested. As a result, after ending of the reporting period, LB Icon divested its operation in St Louis, USA (IconMedialab Inc.) as being non-core. The divestment, by means of an MBO, will have a positive impact on the income statement for the third quarter. This operation contributed EUR 2.0 million in net sales in the first half year.
The full report can be downloaded from the attachment
Robert Pickering
CEO
Amsterdam: Tel. +31 20 460 4500
Stockholm: Tel. +46 8 5223 9000
E-mail: robert.pickering@lbicon.com
Theo Cordesius
COO
Amsterdam: Tel. +31 20 460 4500
Stockholm: Tel. +46 8 5223 9000
E-mail: theo.cordesius@lbicon.com
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