SEC Newgate reports 'excellent start' to year

Communications, advocacy and research company SEC Newgate said it had an “excellent start” to the current year in a trading update on Tuesday, with all businesses performing in line with, or ahead of, budget and management expectations.

The AIM-traded firm’s two largest subsidiaries, Newgate Communications in the UK and Newgate Australia, both enjoyed record levels of profit before tax for the three months ended 31 March.

It said a “strong performance” was also achieved by Cambre in Brussels, CLAI in Paris, SEC Newgate Colombia in Bogotà, and SEC and Partners in Rome.

Since the outbreak of the Covid-19 coronavirus pandemic, SEC Newgate said its agencies had all implemented business continuity plans, working remotely under varying levels of lockdowns in their markets.

The group had taken “all necessary steps” to reduce any discretionary spend and ensure strong cash flow generation, while ensuring it continued to develop and support its 600 people around the world, service its clients, and build market share.

It said it was continuing to operate profitably, with teams working collaboratively and sharing best practice initiatives and experiences.

All businesses had “quickly adapted” to the changed working environment, the board said, and continued to provide “first class service” to clients through online and digital engagement capabilities.

In November, SEC Newgate released its three-year strategic plan, and said the steps taken since had put it on a “stronger and more sustainable” financial foundation.

The group had committed banking facilities available with maintainable covenants, and said it maintained “excellent relationships” with its lenders to support it through the crisis period.

It also benefited from the recent €2.5m convertible bond issue, and a new €3m four-year banking facility with Deutsche Bank, announced in December.

“We are very pleased with the way our group is performing,” said chief executive officer Fiorenzo Tagliabue.

“The recent industry rankings are a validation of the significant progress we are making.

“I am extremely proud of our team which is powered by its entrepreneurial spirit, collaborative approach, and determination to be the most desired agency in the world.”

At 0857 BST, shares in SEC Newgate were up 7.02% at 30.5p.