TMG interim report January - March 2017: A period of internal focus, to lay the foundations for strong growth ahead

The Marketing Group plc (“TMG” or the “Group”) is pleased to announce its financial results for the quarter ended 31 March 2017.

First quarter highlights

• Turnover of €7.19 million
• EBITDA of €125,000
• Net income amounted to €78,000
• Focus on internal restructuring
• New CFO, Mike McElhatton, appointed on 1 March 2017

Post Period Highlights

• New Non-Executive Chairman, Don Elgie, appointed on 1 March 2017
• New Non-Executive Directors, Glen Fraser and Martin Blair, appointed on 28 March 2017
• AGM held on 20 April 2017, confirming new board and passing all resolutions
• New Zealand subsidiaries Marker Metro and Marker Studio merged
• Acquisition of French technology PR specialist, Reflexion Publique by Group subsidiary Ranieri

The Group’s interim results for the six months ended 30 June 2017 will be announced on 15 August 2017.

CEO’s Statement

In the time since I became CEO of the Group in November 2016, I have conducted a thorough review of the business and have been ably supported in this by our new CFO, Mike McElhatton, who joined at the beginning of March 2017.

My conclusion in that there is a strong core of businesses in the Group which have delivered some €563,000 of EBITDA in Q1 2017. However, there are a small number of weaker companies that have held back the rest of the Group, resulting in an overall EBITDA of only €125,000 for the first quarter.

Over the coming months, we shall be taking decisive action on the weaker companies, to either turn around their performance, or dispose of them. This process has already begun and we anticipate announcing stronger financial results as the year progresses.

I have already indicated that we shall announce the results of our review of the business and our forward strategy with the half year results, which are expected to be released on 15 August 2017.

After the high number of acquisitions completed last year, a period of internal focus was necessary. Q1 2017 saw the Group put in place infrastructure to improve communications and facilitate more connections between subsidiaries. We now have several examples of agencies collaborating, internationally, to pitch for bigger clients.

We have created four interlocking communities that group agencies together around complimentary service offerings. This framework allows the Group to offer a more holistic service to clients and to create additional value from the network effect.

This framework will also help inform the future acquisition strategy. It is important to stress that these communities are not silos. All agencies can still collaborate directly, as we continue to build a network of interconnected hubs and nodes, rather than of strata and hierarchy.

This is a progressive, agile and scalable approach to organising a marketing network. Along with our other core beliefs of respecting the individual agency cultures and providing a supportive platform for growth, we believe this is a credible differentiator that will deliver strong value over time.

Adam Graham, CEO

This information is information that The Marketing Group plc is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 7.00am CET on 16 May 2017.

For more information, please contact

The Marketing Group plc

Phone: +44 207 652 9789

E-mail: ir@marketinggroupplc.com

UK
Tim Metcalfe / Miles Nolan

Phone: +44 203 053 8671

Email: tim.metcalfe@investor-focus.co.uk

Sweden

Claes Delin / Mikael Widell

Phone: +46 703 11 9960

E-mail: claes.delin@cordcom.se

The Marketing Group plc (“TMG”) in brief  

TMG is building a global full service marketing network that respects the individual cultures of each agency that joins. By providing a supportive platform for growth, and an agile management approach, TMG aims to provide a fresh alternative to the big holding companies: Independent Spirit - Global scale. Each company within the group provides specialist marketing or advertising services and together form a global network of companies offering clients a full suite of services. The central operating platform supports its subsidiary companies with management and coordinating activities as well as a common publicly-listed investment vehicle. The Marketing Group is listed on Nasdaq First North Stockholm. www.marketinggroupplc.com.

Mangold Fondkommission AB, +46 8-5030 15 50, is the company’s Certified Adviser and liquidity provider.