Envoy Communications Group has posted a fiscal second-quarter profit of $1 million, inclusive of non-recurring items, or 5 cents a share, compared with a year- earlier loss of $26 million. Revenue slid 36.5 percent to $6.5 million from $10.3 million.
The Toronto holding company did not disclose the non-recurring items. CEO Geoffrey Genovese did not return calls.
For the six months ended March 31, net income, including non-recurring items, rose to $571,488 compared to a loss of $27.2 million. Revenue fell 32.5 percent to $15.2 million from $22.5 million.
Envoy, known largely for design operations like Watt International, drew industry attention after its failed bid to buy Leagas Delaney in London at the end of 2000. The company had already embarked upon a diversification move outside Canada into areas like advertising when it bought Hampel Stefanides in New York in 1998. Saddled with expensive real estate obligations in New York, Envoy closed Hampel Stefanides in February and ended the lease.
Since the beginning of the year, the financially strapped company has retrenched and said it will now focus on its "core competencies, consumer and retail branding." In the first quarter, Envoy divested itself of technology companies Sage Information Consultants and Devlin Applied Design.
This year, Envoy also has had to restructure debt and cut operating costs, disposing of 35,000 feet of office space in Toronto and laying off 15 percent of its staff in March.
Tom Wright, the former president of Adidas unit Salomon North America, was hired as president with great fanfare two years ago but is no longer at the company. Wright, who was brought in to run the company on a day-to-day basis, could not be reached. —NO'L