STW results hit by underperforming companies
STW Communications Group has seen underlying net profit after tax fall 15.4 per cent, with its CEO Michael Connaghan attributing the results to the “under performance of a small number of entities”.
STW which has interests in and directly owns over 70 marketing communications companies in Australia also saw revenue fall 10.9 per cent to $269.2m in 2009 compared to the previous year.
Underlying NPAT, which excludes one off costs fell 15.4 per cent to $33.1m. With the inclusion of those costs, NPAT was up 27.9 per cent to $21.8m.
Connaghan said: “The financial performance of the vast majority of entities within the portfolio has been satisfactory, despite the economic conditions. Unfortunately, the Group’s results have been adversely impacted by the under performance of a small number of entities.”
Last year, STW offloaded experiential agency Brand New Alliance, talent management firm International Quarterback and legacy events company Legacy Alliance.
STW said its future earn-out payments is expected to amount to $45m in 2011 according to its latest estimate. Earn-outs refers to the arrangement whereby sellers of a business receive additional future payment, usually based on future earnings.
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