Findings from the Best Practices Benchmarking Survey, conducted annually by StevensGouldPincus, found that U.S. PR firm profitability in 2010 surged back to 2008 levels.
The 104 PR firm respondents reported 15.6 percent profitability, the same figure reported in 2008. In 2009, the response showed profitability was at 13.5 percent of revenue, a four-year low.
The figure was brought down by the profitability of firms with net revenues totaling less than $3 million.
Operating profit for this group was 13.1 percent, which is higher than the 10.4 percent reported last year but lower than the overall average. Firms with revenue between $3 million and $10 million reported profitability at 16.2 percent; firms with revenue between $10 million and $25 million reported 17.8 percent profitability; and firms with revenues exceeding $25 million reported 16.5 percent profitability.
The study also found the average monthly minimum fee was down from $9,808 last year to $8,385 this year. And staff turnover averaged 22.9 percent, down a bit from the prior year.
SGP, an M&A consultancy based in New York, has been conducting this benchmarking survey since 2002.