March 9, 2005

For analysts and investors alike, the earnings results period is about to get underway, and this is the time when B2B companies discuss how exchange trading was for last year, and just what the outlook will be for this year.

Whereas the consumer spent heavily during the advertising recession of 2000 and 2001, for the B2B sector there was a solid recession in corporate profitability.

Since then, expectations for the B2B sector have not been overly inflated and delivery has been in line with expectations.

In the next few weeks we will be getting results from T&F informa – a share story that is being driven by the continued benefits of the merger and the resultant cost saving story.

Of the smaller B2B stocks, most have confirmed the likely headline figures through the pre-close updates. Of these, Metal Bulletin resulted in a modest upgrade as the ever-strong BCA continued to deliver and the buoyant underlying metal prices restored customer profitability to the core metal clients.

The recovery is very welcome and Metal Bulletin seems to be doing a lot to exploit this cyclical opportunity, but ultimately there remain structural issues involved in selling a product to a shrinking number of customers – even if that product is the best in the market.

Incisive Media has continued to please its investors, delivering growth that is driven by a good mix of acquisition and organic development – a mix that should result in above sector average earnings growth.

For Centaur, interim results will also mark a year in the quote arena – a year in which it has worked hard, successfully in recent months – to convince investors of its growth potential and consequent value.

The key message investors will be looking for from Centaur will be confirmation that it has a strategy in place to limit the impact of the move to online recruitment so publicly highlighted in January by the Advertising Association as a risk to the industry as a whole.

Overall, therefore, we would look for this results season to be modestly encouraging for B2B companies.

Source: Media Week