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Ad Agency Margins At Lowest Point In Seven Years

Campaign, Wednesday, August 5, 2015 8:18 AM

Operating profit margins at the UK's top 50 advertising agencies are at their lowest level for seven years, according to research from accounting firm Kingston Smith W1. Its Marketing Monitor report, based on accounts most recently filed at Companies House until 30 June, found margins fell to 10.6%, the lowest it has reported since June 2008. It is the fifth consecutive fall in reported margins in the report, which is conduced twice a year. Margins are calculated by dividing an agency’s total operating profit by its total gross profit.

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advertiser-agency relationship, agency, london, revenue, uk

2 comments about "Ad Agency Margins At Lowest Point In Seven Years".

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Maarten Albarda from Flock Associates (USA), August 5, 2015 at 9:54 a.m.
Ad agencies - as in agencies that create advertising? Or ad groups like WPP? The latter seems hard to believe, given the stellar results the groups have generally posted.
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Maarten Albarda from Flock Associates (USA), August 5, 2015 at 9:58 a.m.

Answering my own question by downloading and reviewing the free report from Kingston - it is the average margins. They do break them down to various sectors - and media is the most profitable although losing some ground.