M&C Saatchi (LSE:SAA) reported a 1.4% decline in like-for-like net revenue to £86.2 million for the first half of 2026, as weaker first-quarter trading and economic uncertainty affected its financial performance.
Statutory net revenue declined 2.7%, while operating profit fell and margins narrowed during the period.
The international marketing and communications group reported a return to modest revenue growth in the second quarter, supported by its data-led Media business and advertising operations in the UK and US.
Management maintained its full-year outlook, expecting like-for-like net revenue and operating profit growth in line with market expectations.
First-Half Revenue Declines as Operating Margins Narrow
M&C Saatchi reported like-for-like net revenue of £86.2 million for the six months, down 1.4% year on year.
On a statutory basis, net revenue decreased 2.7%, while operating profit declined substantially and margins contracted.
The company attributed the first-half performance partly to difficult macroeconomic conditions and lower trading activity during the opening quarter.
Revenue returned to modest growth in the second quarter, with contributions from data-led Media and advertising operations in the UK and US.
Management expects the group’s financial performance to be weighted towards the second half of the year.
Simplification Programme Continues
M&C Saatchi is implementing organisational changes intended to simplify its operations and improve efficiency.
The programme includes streamlining global personnel structures and disposing of its smaller Malaysian business.
The company also confirmed that a proposed management buyout of its Australia and New Zealand operations has been halted.
A new global transformation leadership team has been established to develop the group’s use of cultural insights, artificial intelligence and data across its services.
The Executive Chair will remain in position to oversee the continuing restructuring process.
New Business Includes Brand USA, Pizza Hut and Hugo Boss
M&C Saatchi reported new business activity involving clients including Brand USA, Pizza Hut and Hugo Boss.
The group is focusing on integrated pitches that combine its Citizen and Commercial specialisms with advertising, media and advisory services.
Its operating approach incorporates an AI-enabled data platform and its Return on Cultural Power (ROCP) framework, which the company uses to connect cultural insights with marketing strategy.
Management intends to develop these capabilities into products and services that can be deployed across multiple markets and client relationships.
The group’s operations span the UK, US, Europe and Australia, serving corporate, consumer and public-sector clients.
£2.2 Million Share Buyback Completed
M&C Saatchi completed a £2.2 million share buyback in September 2026 as part of its capital return activities.
The company indicated that it may extend the programme, although no further commitment or additional buyback amount was specified in the supplied announcement.
The buyback accompanies the group’s ongoing restructuring and efforts to improve financial performance.
Full-Year Revenue and Profit Growth Expected
M&C Saatchi maintained its outlook for 2026, expecting like-for-like net revenue and operating profit growth in line with market expectations.
Management anticipates that its Issues and Media divisions will contribute to full-year performance, alongside a greater weighting of revenue and earnings towards the second half.
The company is targeting an improvement in operating margins and operating cash conversion above 80%.
However, it identified conflict in the Middle East and wider economic uncertainty as factors affecting parts of its sport and entertainment and consumer-facing businesses.
The full-year outlook remains dependent on trading conditions and the delivery of expected second-half activity.
Outlook and Strategic Priorities
M&C Saatchi’s priorities for the remainder of 2026 include completing organisational simplification measures, developing its integrated service offering and improving operating margins.
The group is also seeking to expand the application of its AI-enabled data capabilities and ROCP framework across its international operations.
Management expects second-half trading to support full-year growth in like-for-like net revenue and operating profit, following the return to modest growth in the second quarter.
The company continues to target operating cash conversion above 80%, while retaining the option to extend its share buyback programme.
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