Struggling STW Reports 'Disappointing' First Half

Three months on from announcing that it would embark on a 'bruising' restructure, Australia-based STW Communications Group has reported 'disappointing' results, with organic revenue down 4.2% and underlying net profit after tax sliding 22.5% to $15.1m.

In June the Group, which owns a number of research and analytics agencies, announced a new management structure and said it would merge a number of its businesses, following a troubled 2014 and a slump in share price. CEO Mike Connaghan (pictured) told media news site www.mumbrella.com.au there would be job losses and the cutting out of 'dead wood', including a reduction of the number of subsidiary companies from 80 to around 50.

STW bought a majority stake in Colmar Brunton Australia, the country's largest independently owned market research agency, in late 2013, adding to a portfolio already including the Australian arm of UK-based behavioural insights firm <16970, online research consultancy AMR, brand insight firm Added Value, panel management specialist ORU, and data collection agency Touchpoint.

Acquisitions meant that reported revenue in the six months to June 30th climbed 3.3% to $194.4m, but with the underlying figures failing to impress, STW's share price was down on Thursday morning to 63 cents, according to Mumbrella, less than half what is was this time last year and valuing the company at $276m. Connaghan said the firm had known the first half would not be easy due to the loss of 'some big client mandates', but added: 'while we made significant progress in winning new business and our win/loss record has improved, it has not bridged the gap to make up for significant client losses last year'.

Web site: www.stwgroup.com.au .