Ebiquity warns of 'subdued' client spending in FY24

(Sharecast News) - Marketing consultancy Ebiquity said on Tuesday that it expects to make "further profitable progress" in 2024 but warned that client spending was expected to "remain slightly more subdued" until consumer confidence returns. Ebiquity said 2024 had "started satisfactorily", noting that while clients have continued to seek its services as they endeavour to navigate "current media market challenges" and maximise returns from their investments, the quantum of client spend was not expected to change until consumer confidence bounces back to previous levels.

For 2023, group revenue was expected to have grown by 7% to £80.2m, while adjusted underlying earnings were predicted to have increased by 31.0% to £12.0m, reflecting the impact of cost management and a slightly higher margin business mix.

Ebiquity said the expected resulting adjusted EBIT margin, at 15.0%, was an improvement of 2.8 percentage points from 12.2% in 2022, reflecting the operating efficiencies delivered as part of the firm's transformation programme, cost management, as well as continuing growth in its higher-margin digital media solutions business.

Chief executive Nick Waters said: "The group continues to perform well against market and macroeconomic headwinds. Significant investment has been made in our transformation during the year and it is encouraging to see the benefits of this starting to take effect in improved operational efficiency. This, and the positive impact on our business mix of an increasing contribution from the higher margin Digital Media Solutions business, has led to significantly improved profitability. We expect to make further profitable progress in 2024."

As of 1250 GMT, Ebiquity shares were down 2.38% at 36.12p.

Reporting by Iain Gilbert at Sharecast.com