Back in April 2013 Chinese PR-based marcoms contender Blue Focus bought a 20 per cent stake in Lord Chadlington’s quoted PR business Huntsworth for a chunky £36.5m.
Today it was announced that Chadlington (Peter Gummer as was, left) is to step down as CEO following the announcement of pretty disastrous first half results. For the half year, pre-tax profit fell to £6.33m from 8.31m while revenue fell from £88.9m to £83.1m, a drop of 6.5 per cent. This at a time when marketing budgets are, mostly, increasing.
This, presumably, wasn’t exactly what the Chinese had in mind when they bought into Huntsworth although Huntsworth’s shares, which have been on the slide, recovered to their April 2013 levels on news of Chadlington’s departure, which may be some consolation.
Huntsworth’s brands include Citigate (formerly Dewe Rogerson), Grayling, Red and Huntsworth Health so it’s a substantial company with some far-flung outposts outside its UK and European base. But the bigger old-style PR companies have come under pressure recently as the rush by clients into social media has seen some of their budgets go elsewhere, usually to specialist social media agencies. Blue Focus followed up its Huntsworth deal by buying all of UK social media agency We Are Social in December 2013.
It’s not known if Blue Focus was among the shareholders pressing Chadlington to quit. The company has an interesting share register with PR tycoon Matthew Freud buying three per cent last week, as an investment he said. He made a considerable return today.
But it’s a sad finish for Chadlington, ennobled as a Tory peer in 1996 and also chairman of David Cameron’s local Tory Association in Oxfordshire.