The Kingston Smith W1 has released its annual survey of the UK’s 40 largest PR consultancies this week, based on the agencies’ most recently filed accounts at Companies House. It is predicted that the market situation will continue to be tough in 2013 but the PR industry should remain cautiously positive.

Of all the agencies, 27 reported an increase in gross income, contributing to a total of 8% increase across the PR giants, as compared to 5% last year.

While the operating profit margins rose by 0.3% (12.5% to 12.8%), it was reported that across 40 agencies, there was a 7% increase in combined operating profits with a total of £109k in the average gross income per head. While there have been significant improvements in profit margins and revenues in 2012, as supported by the Olympics and the Jubilee celebration, the “eventlessness” of 2013 should not be seen as a probable fall. Instead, the figures in 2013 will reflect the real market condition.

Colin Byrne, Weber Shandwick's UK & Europe CEO, remains optimistic:

“The Games were a boost for many consumer businesses, including ours, but the underlying trend is still positive going into 2013. PR should continue to well outperform GDP growth.”

Kingston Smith W1’s another recent survey shows that operating profits among the Top 30 design consultancies fell marginally by 0.04% while employment costs rose by 14%. While remaining positive, communications professionals should not have overlooked a certain extent of possible setbacks affected by other interconnected industries.

Esther Carder, Kingston Smith partner, concludes: “PR is performing better than most other market disciplines, but the market remains tough. Agencies are still finding it difficult to win new business and procurement is getting more involved and driving fees downward.”