The six month period to 31st January 1999 has seen further strong growth from the Group, with turnover up 30% on the comparable period last year, revenue up 39%, operating profit up 13% and pre-tax profit up 10%.

During this period, the Group has taken another major step towards achieving global coverage by concentrating the bulk of its investment activity in the Asia-Pacific market - with the establishment of start-up subsidiaries in the strategically-important technology markets of Japan and Singapore. In the UK, two further independently-branded subsidiaries opened for business, both of which were briefly mentioned in the last annual report. Joe Public Relations Ltd is a new consumer PR consultancy while Evus Ltd is a more generalist technology PR consultancy with a particular interest in providing marketing services to venture capital startups.

New business activity has been strong throughout the Group, with Text 100 account wins including Wall Data in North America, Telewest in the UK, Analog Devices in Europe and Bharti BT Internet, a BT joint venture in India. Among the independently-branded subsidiaries, Bite Communications wins included BT's Syncordia Solutions division and Internet Bookshop.

Over the past 18 months, the Group has set up no less than 12 new start-up subsidiaries across four continents. That's one every six weeks on average. While this has meant rapid progress towards the Group's ambition to offer its clients a truly global IT-specialist PR consultancy, and while the new start-up subsidiaries contribute to turnover immediately, the short-term effect is to restrain the Group's profit growth. The board believes that a 13% increase in operating profit under these circumstances is acceptable, and that the policy will in time deliver substantial benefits as the Group becomes firmly established in the global IT industry.

It's appropriate to highlight the fact that only one interim dividend of £83,200 has been paid during the six months to January 31st 1999 compared with two interim dividends of £50,000 each in the corresponding period last year. This inconsistency is the result of a change in the phasing of quarterly dividend payments, and the board does not anticipate that the total dividend for FY99 will be any less than last year's figure.

Finally, the board is confident that the Group's strong progress will be maintained in the second half of the year.

Tom Lewis
Chairman

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