• by Joe Mandese , September 7, 2004

Driven by strong "organic" results in its media buying and research operations, Aegis Group Tuesday reported a 15 percent rise in revenues and an 11.9 percent jump in profits during the first half of 2004. The results, bolstered by $1.156 billion in new media billings, disprove sniping from rival media buying networks that Aegis media buying networks like Carat undercut fees and commissions in order to win new business. During the half, Aegis reported that its gross margin increased to 8.1 percent, up from 7.6 percent in 2003.

The results were so strong and are pacing Aegis' growth so far ahead of the U.K.-based company's current stock market values, that Aegis announced its intent to begin a share repurchase program to take back 5 percent of its market equity.

The results were driven largely by the strength of Aegis' media operations, which no doubt colored the upbeat advertising outlook released by the company late last week. Aegis, which last year formed Aegis Media to oversee its burgeoning media services operations, now operates four: Carat, Vizeum, outdoor media unit Posterscope, and newly formed digital media network Isobar (see related story in today's MediaDailyNews.

Aegis Media's combined operations performed well in the period with turnover up 3.8% to $4.23 billion. "This growth rate is ahead of the market indicating market share gains in all three of its operating regions," Aegis stated in a first half earnings report released early Tuesday morning.

Aegis Media revenue increased 7.4%, while organic revenue growth was 6.6%. The media operations had net new business wins of $1,156.2 million in annualized billings vs. $522.0 million in 2003, as a result of several high-profile new business wins during the half, including Carat's communications planning assignment from Procter & Gamble.

However, the company noted that Vizeum, the new "challenger brand" media network it launched in Europe last year, has emerged as a significant player.

] Starting in June 2003 with a "network of agencies in 12 European countries, Vizeum has now grown to 20 countries with over 200 clients and billings of some $2.25 billion," stated Aegis. "Major new business wins in the period include Heinz, Pernod Ricard, Timberland, Asics and Kia.

A significant contributor to the media account success, said Aegis, was Vizeum's unique market position, as well as its alliance with Aegis' with Synovate, Aegis research operations. In particular, Aegis said Synovate's motivational research specialty unit Censydiam, which develop tools that analyze how subtle forces drive consumers to select one brand over another, was a significant factor. The company said the units have just completed "the largest ever survey of consumer motivation across 10 advertising product categories and interviewing over 60,000 people across Europe."

While Aegis has given no indications on whether or when it might introduce Vizeum to the North American marketplace, Aegis has been quick to incorporate proprietary tools and systems developed by one unit into its others, such as the close affinity between Carat and marketing mix modeling specialist MMA.