2018 was a strong year for the Clemenger Group, with our revenue increasing some +3% to $366.6m. Our profit after tax was $47.0m, which was in line with the prior year.
During the year our shareholders enjoyed a 50 cent per share interim dividend in addition to the annual dividend of 13.25 cents per share. The new share price is $3.11. This has been a great year for our over 350 local shareholders as well our major shareholder BBDO Worldwide.
The year saw Clemenger move from St Leonards in Sydney where we had been for over 30 years to fantastic new premises in Walsh Bay. Everyone is loving the new surroundings and it has facilitated a huge increase in cross discipline cooperation – a very important requirement in our business today.
Some of the many highlights on the new business front were: BMW, Menulog and the AFL at Clemenger BBDO Melbourne; Austrade out of Clemenger BBDO Sydney; EECA out of Clemenger BBDO Wellington; Alinta through Marketforce; McCain foods at Porter Novelli and Mortgage & Finance Australia through the combined efforts of GRACosway, Porter Novelli and Redhanded. CHE Proximity continued their winning ways winning Vanguard Investments, Prospa, RACV, Danone and Michael Hill. Perhaps the highlight of the year was winning Farmer’s through 99 in Auckland. There were many other new assignments across the Group.
Jim Moser left the Group to join BBDO as Chairman of BBDO Europe. Jim was with us for 18 years and made a huge contribution in both New Zealand and Australia.
We welcomed Levo into the company. Levo are experts in web development and e-Commerce. They are already working across the Group on shared clients like Mazda.
Kim Boehm retired at the end of 2018 after nearly 40 brilliant years. Kim ran our Adelaide Agency, CHE and was a key part of the success of Clemenger BBDO Melbourne for many years. He more recently oversaw Group Talent and Marketing and did a fantastic job on this too.
Jim Gall became CEO of Clemenger Group New Zealand replacing Jim Moser. He also worked to re-engineer our leadership in Perth. Lachlan Drummond replaced Jim Gall as Managing Director of Redhanded.
Imogen Randell became CEO of both Hall & Partners and Quantum.
Our companies were recognized widely for the work we do and we detail these achievements in the body of this report.
In 2019 we will continue to be successful as long as we remain committed to creativity for our clients. Through new technology and data, we can now reach our customers more efficiently. But, with our superior creativity, we can engage them more effectively than ever. This is our long term, sustainable competitive advantage.
2019 will be a strong year as long as we commit to creativity and transforming our businesses in the digital world. We all need to embrace the major changes to our industry and become experts at using the new tools at our disposal. Training and developing new skill sets will be critical to future success.
2018 Chairman's Report
2018 was a strong year for the Clemenger Group, with our revenue increasing some +3% to $366.6m. Our profit after tax was $47.0m, which was in line with the prior year.
During the year our shareholders enjoyed a 50 cent per share interim dividend in addition to the annual dividend of 13.25 cents per share. The new share price is $3.11. This has been a great year for our over 350 local shareholders as well our major shareholder BBDO Worldwide.Read the full Chairman's report Play Introduction
Our success comes from the company we keep. As diverse as they are brilliant, each part of this Group is united by a passion for creative problem-solving.
2018 was a year of success for CHE Proximity. It claimed a record six Agency of the Year titles for both creative and effectiveness and was ranked as the ninth most creative agency in the world by the Won Report. The agency enjoyed 43.5% profit growth after tax and wins, including eBay, RACV, AGL, Uniting Health, Travel Insurance Direct, Uber, St Vincent’s Health, Jemena and ING, complemented by growth on Telstra and Virgin Australia Group. CHE Proximity also welcomed Vanessa Nicol as Managing Director, Sydney and promoted David Halter to Chief Strategy Officer.
Colenso BBDO had another strong year in 2018, picking up several significant awards, including being ranked tenth in the world by the Gunn Report, and ranked sixth in the world by The Big Won, and the fifth most effective agency in the world by The Global Effie Index. It was also named NZ’s Axis Agency of the Year for the third consecutive year. It also successfully won nine new clients, made hires from Accenture, Contagious and Saatchi NYC, and, to top it all off, was named Campaign Brief’s New Zealand Agency of the Year for 2018.
Clemenger BBDO started 2018 being crowned the world’s best agency by the Big Won Report. It rallied behind a new purpose and positioning, ‘Creativity is always the answer’, to help galvanise their culture and agency-wide change agenda, focused on building new capabilities, hiring new talent, and winning new clients, including BMW, AFL and Menulog. Creative highlights included Myer’s Naughty or Nice Bauble, Deadly Questions for Aboriginal Victoria and The Internet Remembers for DrinkWise.
There were a couple of changes to the senior executive line-up at Clemenger BBDO Sydney in 2018, with Nick Garrett stepping into National Chief Executive Officer role and Lilian Sor joining as Chief Strategy Officer. With the full team in place, the agency focused on its creative output, with highlights including their network campaign for Qantas, Aussie News Today, Extra Support Acts and Eclipse Reveal Your Real. New appointments added depth to their Business Management and CRM teams. New business wins included Qantas, Ola, 4 Pines, Hewlett Packard, Amplify and Austrade.
Clemenger BBDO Wellington earned its position as New Zealand’s Behaviour Change Innovators. It started 2018 still ranked number one in New Zealand by Campaign Brief’s The Work. The agency won the Ngā Aho Award for Oranga Tamariki at the Best Awards for design that responds to indigenous culture. It also won the Hardest Challenge Effie for Give Nothing to Racism. Clemenger BBDO Wellington were delighted to take home the inaugural Brand Axis for the client and agency who have created excellent creative work for 5+ years with New Zealand Transport Agency. And to top it off, it won the number one government pitch in New Zealand with EECA.
Clemenger Brisbane had incredible award success in 2018, being the only Queensland agency to win a Cannes Lion. It also delivered the most successful campaign in Queensland Government’s history via the Commonwealth Games transport management, which went on to win state and national AMI awards. It also picked up 15 new clients, including Queensland Rail, Transurban, the Department of Education and Keno – all in a year with no client losses.
In 2018, Brandworld won back the prestigious GlaxoSmithKline health business. It also created a new “always on” owned IP platform, Oxygen, that was picked up by two clients, and created a national anti-litter campaign that featured New Zealand Prime Minister, Jacinda Ardern.
Clemenger Field Marketing has gone from strength to strength since launching three years ago. In 2018 the company welcomed Coty as a key client. In addition to Coty, its NSW clients now include Playstation, Ubisoft and Roadshow. It also extended its partnership with Mattel into the New Zealand market.
Creative Activation had an extremely positive 2018. It successfully deployed the final touchpoints of ‘Project Serious’ – a three-year re-development of their systems, all of which are now integrated. New business successes included Sabrands, The Good Guys and Samsung. Its successes have been reflected by record financial results.
eg+ introduced a content offering to clients, which proved to be very successful and resulted in new staff hires. The agency won a series of new work, including Bayer and PepsiCo adaptation – both an outcome from its global alliance. It was also awarded the L’Oréal adaptation business, following an eight month pitch process. The agency also won the ExxonMobil Wholesale Fuels business and signed a new contract with NAB for a further two years, taking the relationship to 13 years.
GRACosway was busy in 2018, advising financial services clients on the Hayne Royal Commission and ongoing sector changes. It established a presence in New Zealand as GRC Partners, and its affiliated Perth business celebrated its 10 year anniversary, re-branding as GRA Partners. GRACosway also worked extensively with clients in the energy sector, advised government clients on a range of issues, and worked with disruptors such as Volt Bank, Alipay and Prospa.
Hall & Partners had several significant wins in 2018, including picking up the Whole-of-Government communications evaluation contract. The work was managed by the team in Melbourne and headed up by Gary Colquhoun and supported by Lizzie Cox, who was promoted to Research Director, along with new appointments made specifically to run the account. Hall & Partners has had several changes to its executive team and structure, including the appointment of Matthew Sandwell from The Lab as Managing Partner of Melbourne.
justONE picked up several new clients, including New Zealand’s largest bank (ANZ) and welcomed back Farmers Club. It also saw several wins for its existing clients, including nine NZDM awards and a bronze at the DMA International Echo Awards. justONE added to its leadership through the promotion of Troy Fuller to Managing Director of 99 and Raydar, who was also providing oversight of justONE. Nicola Henshaw, a leading Customer Experience Planner in Australasia, also bolstered the company’s management ranks.
Levo joined Clemenger Group in July 2018. Following this integration, the company has had several new client wins, such as Bolton Clarke, a leading aged and health care provider, and Wilson Group, including Security and Parking across Australia and New Zealand. Levo has also been selected as a digital transformation partner for Bendigo Bank. To assist in shaping Levo for growth post-acquisition, Cale Maxwell was promoted to the role of Chief Operating Officer, Josh Fernandez appointed as Experience Design Director and Mason Phan hired from AKQA in the newly created role of Delivery Director.
In 2018, Marketforce welcomed new Chief Executive Officer Adam Marshall and new Chief Creative Officer Paul Coghlan. It also launched two new services: Flare, a content marketing agency, and Litmus, a marketing consultancy. New clients to the agency included Alinta Energy, Hyundai WA, Ventura Home Group, and Tourism NT. Creatively, the 2018 highlight was winning a Bronze Creative Data Cannes Lion for use of real-time data for ‘The R Word’.
Perceptive had another strong year, having achieved both record high revenue and profit. The agency maintained excellent client retention with an Net Promoter Score of +72, which enabled it to grow revenue while improving overall profitability. It picked up several new substantial clients, including the global insights partnership for Xero, restructured its leadership team to enable future growth, and assisted fellow Clemenger Group agencies in winning several new and significant pieces of business.
Tough operating conditions dominated 2018, but organic growth was a highlight for Porter Novelli Australia, including McCain Foods, Kubota, Dow, Yumbah, Panasonic and the Mortgage and Finance Association of Australia. Collaboration with other Clemenger Group companies, specifically GRACosway, Redhanded, Quantum Market Research and Traffik, as well as re-engaging with the Porter Novelli network resulted in cumulative brand power for the agency.
Porter Novelli New Zealand’s new, high-performing team ended 2018 on a high, hitting their numbers and winning a significant government Request for Proposal. This capped off a year of new business wins including BP, Broadcasting Standards Authority and the Financial Markets Authority.
Quantum Market Research continued to grow its existing clients, including NAB, the Victorian Government, Yarra Valley Water, Tourism North East and Bupa. It also developed new relationships with Nufarm, Nib, Hewlett Packard, Jeld-Wen, Our Watch and saw the return of DrinkWise. The organisation promoted Richard Frost to Managing Partner and appointed several mid-tier consultants. The depth and breadth of clients Quantum Market Research services continued to expand across sectors such as agriculture, tourism, telecommunications, finance, insurance, not-for-profit and social and government.
Raydar found 2018 to be a successful year, which was capped off by winning the Australasian Promotional/Experiential Agency of the Year at the B&T Awards. Troy Fuller was appointed Managing Director of Raydar, 99 and justONE. The company experienced organic growth across several key clients, including Frucor and Fonterra, as well as winning several pieces of new business with Griffin’s Foods, Kimberly Clark and Stonewood Homes. Overall, Raydar solidified its position as the top Activation Agency in New Zealand.
Redhanded experienced a significant change in management structure, with its founder and Chief Executive officer Jim Gall leaving to become the Chief Executive Officer of Clemenger Group New Zealand. Lachlan Drummond has been promoted to the role of Redhanded Managing Director. The agency won several new clients, including the Mortgage and Finance Association of Australia (in collaboration with GRACosway and Porter Novelli), AFG, Bayer CropScience Horticulture, Hustler Equipment (New Zealand), Glenelg Shire and Tourism North East, as well as expansion of events and activations. It also won four Davey awards.
2018 was one of Traffik’s most successful in its 17 year history. It was awarded B&T Experiential Agency of the Year, Adnews’ Specialist Agency of the Year and Mumbrella Experiential Agency of the Year – the first time Traffik, or anyone in its category has won the ‘trifecta’. It picked up five key new clients – CERNO, MLA, Premier Foods and Dyson Corporate. Traffik exceeded profit after tax targets by 22% – the biggest growth seen in five years. Major assistance was provided to the Clemenger BBDO Melbourne activation division, solidifying their CUB relationship and becoming their preferred shopper agency.
2018 was a very successful year for 99 with the appointment of a dynamic new partnership in Troy Fuller, Managing Director and Mick Stalker, Executive Creative Director. A new direction for the future was received with excitement and optimism, resulting in positive improvement in staff engagement. The highlight of the year however, has to have been the Farmers pitch win.
While there were enough awards across the Group to make even the sturdiest trophy cabinet strain, some pieces of work shone through.
Awards throughout the year, as recognised by WARC
From reshuffling to relocating, 2018 saw a number of changes that helped to streamline business and create new opportunities.
Members of the Group
Moments of Recognition
Nick Worthington was honoured with a “Lifetime Achievement” award, Colenso won Agency of the Year for the third year in a row, Clemenger Wellington won a Brand Axis recognising five years of continued creative brilliance on NZTA and Fonterra won Client of the Year.
This year Porter Novelli Australia Chief Executive Officer Peter Kent marks 20 years with the Clemenger Group. Peter’s career lifeline tracks from adventure travel to journalism, then government and consulting, which he says he only meant to do for a few years between “real jobs”. From Sydney to Melbourne and then leading Porter Novelli Australia, Peter’s contribution and impact has been outstanding. Congratulations Peter.
Clemenger Group has once again put some of its best and brightest through Clemenger University - an intensive week-long residential MBA-level course at the Melbourne University Business School. Started by Peter Clemenger, the program brings many of our companies together in the spirit of collaboration and learning.
Pride and Joy
Something to shout about
Tour de Cure
Tour de Cure had long been dear to the hearts of the Creative Activation – after all, two former Creative Activation employees were its co-founders. Its company Executive Chairman, Bruno Maurel, is also the Chairman of Tour de Cure.
In 2018, Clemenger Group sent nine riders from our companies – Clemenger BBDO, CHE Proximity, Redhanded, Porter Novelli, Quantum, Hall & Partners, Traffik and Creative Activation. This promoted collaboration across the Group and lifted the awareness of causal efforts across the Group. We raised $90,000 for Peter Mac Cancer Research, exceeding our target. Well done to our riders and thank you everyone for your support.Read More
Diversity initiatives were driven by Agency Circle and led by Clemenger BBDO Sydney’s Managing Director, Emily Perrett. Our companies attended Changing the Ratio and joined the Omnicom Open Pride movement.
In Australia, we’ve been working with Workplace Gender Equality to ensure equal access to rewards, resources and opportunities for all our people. In New Zealand, our companies achieved the Rainbow Tick certification mark, which further demonstrated an understanding of sexual and gender workplace diversity.Read More
2018 saw continued growth in the Group, with eight recruiters joining our companies across both Australia and New Zealand. This team single-handedly saw to 60% of the Group’s recruitment requirements, saving us close to two million dollars.
In September, we launched the Freelance Portal, and are currently working to standardise terms of business with external recruiters.Read More
Concise Financial Report
The Concise Financial Report and Auditors' Report contained within this document represent a Concise Report. The full financial report of Clemenger Group Limited for the year ended 31 December 2018 and the Auditors' Report thereon will be sent, free of charge, to members upon request. Members wishing to receive the full financial report and Auditors' Report may arrange for a copy by contacting Adrian Ciabotti on 03 9869 4206.
The Concise Report contained within this document has been derived from the full consolidated financial report of Clemenger Group Limited for the year ended 31 December 2018 and cannot be expected to provide as full an understanding of the financial performance, financial position and cash flows of the Group as the full financial report.