Entrepreneur John Singleton made the right decision when he sold his 9% shareholding in STW Communications Group, last May for $53.7 million. Yesterday they would have been worth just $1.5 million.
Entrepreneur John Singleton made the right decision when he sold his 9% shareholding in STW Communications Group, last May for $53.7 million. Yesterday they would have been worth just $1.5 million.
And the outlook is not good. As companies tighten their budgets, the marketing services company predicts a net profit of $39 million for calendar 2008 – down 6.3% from $41.6 million in 2007.
STW prices have plummeted over the past 10 months. Shares closed at just 61.5 cents yesterday, from $2.34 in early January.
Chairman Robert Mactier told The Australian Financial Review the group is “very concerned about our share price decline [but it is] being driven by investor sentiment and factors, many of which are outside our control”.
Chief executive Mike Connaghan also said the group is not immune to shock waves reverberating around the business world.
But despite share price declines and $16.9 million spent in buying back shares over 2007-08, Connaghan says STW is “firmly in control of what we can control”.
“In these times, clients search for agency groups with proven track records of delivering results and maximum effectiveness.
“This is one of our most powerful differentiators. We view impending tougher trading conditions as an ideal opportunity to grow momentum and grow our leadership position.”
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
