Trading Statement (0366C)

TIDMMSQ

RNS Number : 0366C

Media Square PLC

01 March 2011

Media Square plc ("Media Square" or the "Group")

Trading Update

The Board wishes to announce that the second half of the current financial year (the six months ending 28 February 2011) has continued the trend of solid profitability that we announced for the first six months. The full year results for the year ended 28 February 2011 will be announced in May.

Revenues in the second half have remained at broadly similar levels to the first half reflecting macro-economic uncertainties and continued caution by many of the Group's clients. The Group's continuing businesses have generated a modest improvement in profitability in the second half compared to the first half. Over the full year operating margins and profitability have benefited from the reduction in the Group's cost-base and improvements in operational efficiency.

The Board anticipates that the Group's performance for the year ended 28 February 2011 will be in line with market expectations, when including the performance of both continuing and discontinued businesses. However, following the disposal of arken, which was loss making during the year, reported operating profit (which, under IFRS, is stated excluding discontinued businesses) will exceed market expectations.

Looking forward, the Board is cautiously optimistic and believes the improving profit trend will continue. However there is limited visibility of client intentions which makes it hard to forecast future revenue growth.

Peter Reid CEO comments

"The past six months have seen a solid performance from the group and there is still upside to come from further improvement in margins. The agreement of new bank facilities, which we announced last year, and the disposal of arken provide a stable platform of focused marketing communications agencies which allows us to renew our efforts on winning new business. The main focus of management continues to be to reduce the group's bank debt which remains unacceptably high reflecting past acquisition activity. "

For further information please contact:

 
 Media Square plc                  www.mediasquare.co.uk 
 Roger Parry                       020 3026 6601 
 Peter Reid                        020 3026 6607 
 
 Collins Stewart Europe Limited 
 Adrian Hadden/Stewart Wallace     020 7523 8350 
 

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