2003: a very good year for Ipsos
Operating profit +16% at 50.7 million euros
Net profit (group share) +28% at 30.3 million euros
Paris, March 23, 2004. Ipsos' consolidated revenues for the year
ended December 31, 2003 totalled 569.7 million euros, an increase of 6%.
At constant scope and exchange rates, revenues grew by 9.4%, at least twice
as fast as the market and the other major international research companies.
The market continued to consolidate in 2003. The major international players, including Ipsos, pursued an active acquisition policy. The largest customers also showed an increasing desire to work with strong research companies capable of deploying cohesive, skilled teams on a global level.
Overall, 2003 saw Ipsos maintain its strategy of growth, international expansion and specialisation.
Strong growth in operating profit and net profit
In million of euros
|
2003 |
2002 |
Change
2003/02 |
Revenues |
569.7 |
538.4 |
+6% |
Gross profit |
335.7 |
311.5 |
+8% |
Operating profit |
50.7 |
43.6 |
+16% |
Net financial expenses |
(7.1) |
(5.9) |
- |
| Net profit* |
30.3 |
23.7 |
+28% |
*before amortisation of goodwill
Operating profit came in at 50.7 million euros, a rise of 16%. Operating margin was 8.9%, up from 8.1% in 2002, and the increase accelerated in the second half of the year. This operating margin figure is at the upper end of our forecasts, despite strongly adverse currency effects. At 2002 exchange rates, Ipsos would have achieved operating profit of 60 million euros, up 40%.
This performance is especially remarkable since it came at a time when Ipsos was continuing to lay the foundation for future growth by bolstering its management structures, increasing R&D spending and stepping up internal training programmes.
In addition, the improvement in profit margins was mainly due to companies already consolidated in 2002. This shows that all companies having joined Ipsos, whether recently or further in the past, benefit fully from being part of the group.
Net financial expenses rose in line with the increase in debt, one third of which has been indexed on 10-year rates.
There were no significant exceptional items affecting the 2003 financial statements.
The tax rate remained lower than the common rate.
Overall, Ipsos generated net profit (group share) of 30.3 million euros, up 28%. At 2002 exchange rates, the figure would have been 37.5 million euros, up 58%.
Earnings per share (before amortisation of goodwill) increased sharply to 4.31 euros versus 3.54 euros in 2002. Consequently, distribution of a dividend of 0.85 euros per share (excluding tax credit) will be proposed to the Ipsos General Shareholder Assembly which corresponds with a 20% distribution rate, in line with the company's stated intentions at the time of the IPO.
Acquisitions in 2003
Ipsos acquired six companies in 2003:
- Belgium: INRA Belgium, specialising in marketing and opinion research
- Taiwan: Partner Market Research
- Canada: Market Explorer, specialising in advertising research
- USA: Marketing Metrics, specialising in CSM/CRM research
- Australia: The Mackay Report, specialising in opinion research, and
- the marketing research division of NCS Pearson.
These companies were consolidated as of July 1 2003, with the exception of INRA Belgium (January 1, 2003) and NCS Pearson (October 1, 2003).
A solid financial position
Ipsos had net debt of 149 million euros at December 31, 2003, as opposed to 134 million a year earlier, following acquisition payments of 48.5 million euros during the year.
Shareholders' equity was 198 million euros at the end of the year, against 192 million euros at December 31, 2002, giving gearing of 75.0%, below the limits set by Ipsos.
The financial position was strengthened by the issue of 90 million US dollars of 10-year bonds in May 2003.
2004 outlook
Market research spending should grow by around 5% in 2004. This growth is likely to be driven by rapid growth in several regions, such as Asia, Latin America and Central Europe, and by higher spending in industries like IT, telecoms and media.
In this environment, Ipsos is confident in its ability to continue gaining market share, and therefore maintain growth at the 2003 level. This confidence is underpinned by a large number of initiatives resulting from investment in human resources, management structures and new services over the last few years.
Our customers are increasingly demanding. They want to build closer relationships with strong, international and skilled research companies that are capable of producing and distributing top-quality information more quickly, while at the same time deploying powerful analytical resources that enable them to interpret, simulate and anticipate precisely the needs and reactions of consumers, customers and citizens. This is how Ipsos is positioning itself in its market.
In 2004:
- Acquisitions will continue, particularly in Asia, the USA and the UK.
- Organic growth is likely to be the same as in 2003, with growth in Europe reaching at least 5%.
- Operating margin will further improve.
Appendices:
Balance sheet at December 31, 2003
Income statement
Cash flow statement
The presentation of 2003 activity and results
will be available as of March 24 on www.ipsos.com. A conference-call will take place on that day at 4 PM (CET)
Click here to access the presentation