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YouGov Grows US and UK Business
YouGov has announced preliminary results for the year ended 31 July 2010, with a good second half performance bringing full year results in line with expectations after a fall in late 2009. One-off items led to a substantial reported operating loss of £9.6m (2009: £0.7m).
Turnover was static at £44.2m (2009: £44.3m) thanks to second half revenue which rose 5% compared with the prior year, while adjusted operating profit rose to £3.8m from £3.1m. The reported operating loss was the result of a goodwill impairment charge of £7.9m relating to the company's German subsidiary, and other exceptional items totalling £1.8m. YouGov says its balance sheet remains strong, with cash increasing to £15.6m at 31 July 2010 from £12.7m a year previously. Operating cost savings of £2.5m were achieved.
Revenues in the UK and USA were up by 10% and 38% respectively, while other regions saw declines: the Middle East down 15% due to an expected reduction in a large contract and Germany and Scandinavia respectively 7% and 6% lower as the company reshapes the businesses in these regions.
CEO Stephan Shakespeare says strong perfromances in the US and UK indicated the strength of 'the core YouGov model which is now at the focus of our strategy'.
Following the purchase of NJ-based Clear Horizons in April 2009 and that of Harrison Group, based in Waterbury, CT, the firm says it has 'a strong base from which to continue to expand in the US'.
US business grew revenue by 39% to £4.8m and more than doubled operating profit to £0.5m. Commercial (i.e. non-political or academic) revenue was a specific focus for the firm this year and grew by 86%, with the new Marketing Insights division (formerly Clear Horizons) winning more complex commercial research projects. The BrandIndex service, which grew global revenue by 53%, also did particularly well in the US.
The UK business saw revenues up 9% to 12.1m and operating profits up 60% to £3.4m - operating margin rose from 18% to 28% showing the benefits of last year's restructuring of the custom business. The firm also experience a growth in its Omnibus division and a boost from polling for the UK General Election, where its daily polls and other rapid results services helped News International to break news of Nick Clegg's storming success in the first televised debate and make early predictions of a hung parliament.
Chairman Roger Parry notes: 'Going forward, the Board is focused on using the successful core UK business as the model for expansion internationally which will be largely organic. We will, however, continue to consider the selective acquisition of businesses that strengthen our existing operations and from which we can derive further benefits of scale.'
As at 31 July 2010, the Group's online panels comprised a total of 2,510,500 panellists, up 13% on the year, with particular panel growth in the UK (up from 266,000 to 338,000) and the USA (1.75m from 1.5m). Scandinavia, Austria and Eastern Europe saw a scaling down of panel sizes.
In line with the company's 'return to core strategy' there is a renewed focus on innovation with greater use of Smartphones and Twitter to allow rapid feedback and the launch of the instant opinion web site 'TellYouGov'. The firm has also launched sector report service SixthSense which draws on a combination of its own primary research data with other specialist data sources and expert views - sales began in the second half of the year and 108 report titles covering 36 topic areas are already available.
The year also saw the departure of co-founder and CEO Nadhim Zahawi in February 2010 - he is now the Conservative MP for Stratford on Avon. Co-founder Shakespeare takes over as sole CEO. Chairman Roger Parry thanked Zahawi 'for his entrepreneurial energy and his role with Stephan in taking YouGov from a start-up to becoming one of the worlds's best known and most respected market research companies in the space of ten years'. New NED Ben Elliot, founder of Quintessentially, joined in August.
YouGov says market conditions are showing signs of improving and adds that it has continued its momentum from the first half of 2010 into the second, adding to its confidence in the future.
Web site: www.yougov.com .
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