By Paul Sandle
LONDON (Reuters) – British polling and research company YouGov said it had identified most of the cost savings it needed to underpin a recovery in its profit margin after a warning in May hit its share price hard.
The company, famous for its political predictions, on Tuesday reported a 21% drop in adjusted profit before tax to 45 million pounds ($58.4 million) for the year to end-July on revenue up 3% on an underlying basis.
Chief Executive Steve Hatch said it had been “unquestionably a year when we had to make tough decisions relative to what we saw and our revenue expectations”.
YouGov, which completed the acquisition of European household purchase data company CPS in January, said in May it was seeing lower sales bookings than it expected and as a result downgraded its profit expectations.
The numbers published on Tuesday came in slightly ahead of the downgraded expectations, and Hatch said the group had taken initial action on 17 million pounds of cost savings out of a total 20 million pounds, which included shedding 7% of staff.
“The macroeconomic environment remained challenging across the wider market research industry and for YouGov, while internal execution also contributed to the challenges we faced,” he said.
“We acted quickly over the summer and I am confident that we have put the right initiatives in place as we focus on the execution of our long-term strategic plan.”
Shares in YouGov, which tumbled 30% after the profit warning, were trading up 12% in morning deals.
While trading in the current year was broadly in line with last year, YouGov was continuing to see demand for its custom research data, Hatch said, and he expected sales booking momentum to pick up in the second and third quarters.
($1 = 0.7704 pounds)
(Reporting by Paul Sandle; Editing by Kirsten Donovan)
