The Board of TFI Group says it is “delighted” to have achieved operating profit targets, despite a drop in turnover.
The agency, issuing its annual results, says overall net profitability was maintained in 2013 through maximising supply chain and Group synergies.
The results represent TFI’s first full year of activation of a four-year plan announced last year.
The figures released for 2013 show turnover dropped from £4,974,000 in 2012 to £4,065,000.
Gross Profit dropped to £1,758,000 from £1,908,000. However, gross profit margin increased from 38 per cent to 43 per cent and net profit was £13,203.
The company blamed an 18 per cent drop in turnover on a combination of a change in the mix of projects delivered towards more consultative and production-driven work – as well as the process of instituting structural changes.
The company said underlying turnover was flat due to a lower proportion of ‘pass through’ turnover (3rd party costs).
TFI claimed the numbers were in line with expectations and that the Group would continue to implement plans for growth in each of its chosen channels of operation.
“The key is to bed down what the business has started and to ensure that by 2017 the plans for solid and exciting growth are met,” the financial statement said.
The Group pointed to increases in sales activity in line with its plan to become more sales driven.
As for the its channels, TFI said TFICorporate developed well in 2013, with the establishment of the Singapore office and a new UK production unit.
TFIMeeting Point had also seen a valuable development; while TFIPharma had a year of healthy growth and is now the largest of the three channels.
Business Development Director Simon Maier (pictured), who has developed much of the current TFI shape, said: “2014 is showing that the platform we created during the past year is paying dividends. We’ve seen positive indications of increased activity and intent among our clients, something that’s continuing this fiscal and we have seen these trends across the group’s trading operations. Our clients want to know that sustainable growth means that we can deliver consistent value to them. What’s more, our clients like the fact that we are building our capability on the product front and increasing our account management and production/delivery teams.”
The company invested in new staff during the year, in line with its development as a full service events agency.
Maier said the business was developing a recruitment model based on an event services agency rather than a reactive event management business.
TFI invested in a product development unit in 2013 and the business is also to launch TFIVenues, a free worldwide venue-finding service.
Maier added that the continuing position in the broader economic environment had placed pressures across the industry sectors that TFI Group serves.
“While the Group has not been immune to these pressures, the breadth and scope of our business offerings, combined with the flexibility in our cost base, has allowed the Group to improve its competitive advantage. TFI has seen that many of the Group’s competitor activities have been materially affected or curtailed, which places TFI in a strong market position,” he said.
TFI’s Chairman, Peter Franks added: “During 2013, the Group continued to win new business and renew client contracts at sometimes much enhanced levels. The pressure on client budgets in 2013 resulted in lower spend levels from some existing clients.
“My Board and I are delighted that we achieved our operating profit targets. This success was made through a combination of excellent client relationships, a good pipeline of new business, stronger internal management and bringing to life wider aspects of our proposition of helping our clients engage with their audiences.”
The Group is predicting a “significantly more positive” outlook for 2014 and “significant growth over the next two years with an increase in new clients and steady development of current client activity”.
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