Profits plunge at BBB Design

Listed company BBB Design saw its profits plummet after two clients cancelled orders of a lottery scratchcard concept developed by the group’s marketing division. The year ending 30 April 1997 saw a pre-tax loss of 59 000 compared to the company’s previous year’s profit of 233 000.

The competition card project “represented a substantial commitment, developed over many months by our marketing and design divisions”, chief executive Philip O’Donnell wrote in the Report and Financial Statements.

The consultancy has just settled out of court with a major UK charter airline, after the agreement, “which restricted us from selling the concept to other airlines, was cancelled by the client without notice or reasonable cause”, said O’Donnell in the document. The settlement was made prior to BBB issuing a writ. He is unable to disclose the name of the client or the size of the sum involved.

BBB is also in the process of negotiating with an unnamed ferry company over the same scratchcard concept. “They ordered it, we produced it, they cancelled it,” says O’Donnell. “If they don’t settle out of court, we will issue a writ,” he adds.

The cancellations gravely affected turnover, which fell to 976 000 from 1.04m in the previous year, but the group did not lose any staff, says O’Donnell.

BBB’s plans for major growth, announced at the beginning of the year, are still on track.

“We are still looking to acquire, and this could include a design company, although we are not looking [in that area] at the moment,” O’Donnell adds.

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