By Greg Hazley
Chime Communications, the U.K. holding company of Bell Pottinger, said operating income and profit fell five percent at its global PR operations for the first six months of 2011 as exposure to political, social and economic instability hurt that sector.
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But the company sees the potential to benefit from PR assignments arising from the Arab Spring in the medium to long term.
PR operating income dipped to £23.6 for the first half on profit of £7.8M.
PR’s decline was offset by advertising and sports marketing gains in the first half and Chime posted five percent overall increases in organic revenue and profit for the first half of £73.3M and £13.4M, respectively.
Chairman Tim Bell said its PR operations, which also include Good Relations, Corporate Citizenship, Harvard and Insight, had flat profits in the first half, hurt by a slowdown in geopolitical work due to Middle East unrest and European debt problems.
“The events of the Arab Spring have created some short-term challenges, but in the medium to long-term the opportunities for us to provide communications advice to emerging governments are considerable,” he said, adding that Bell Pottinger is “uniquely placed to benefit from this.”
BP has worked in global flashpoints like Sri Lanka, Bahrain and Yemen.
Strong PR profit performance in financial, corporate and consumer, and the Middle East partially offset a reduction in its PR work with the U.S. military overseas, he said.
On its U.S. government work, Bell noted the company, which had a hundred-million-dollar contract supporting PR for the U.S.-led Iraq operation, has seen a reduction in income amid the large U.S. budget deficit and its commitment to reducing troop activity.
“We have a great deal of expertise in communication activities in areas of conflict around the world and we are already developing ways we can use this expertise further,” said Bell, who was a top advisor to British Prime Minister Margaret Thatcher.
Chime acquired healthcare PR shop Reynolds Mackenzie in a $4M deal in July.
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