SHARES in SpaceandPeople have surged more than 12 per cent after the shopping mall marketing specialist clinched a five-year deal with Network Rail.
The Glasgow-based company has secured exclusive rights to promote brands across all 18 Network Rail stations across the UK, including Edinburgh Waverley and Glasgow Central.
Details on the commercial value of the deal were not disclosed. However it gives SpaceandPeople the chance to promote its clients’ brands to a massive audience. The stations, which include London’s Kings Cross, Victoria and Waterloo and Manchester Piccadilly, attract an annual footfall in excess of one billion passengers, with that number expected to grow.
The agreement, which starts on October 1, comes after SpaceandPeople secured a one-year contract from Hermes Real Estate in June to run events at a shopping centre the investment manager owns in Milton Keynes.
It was also announced then that it had won a three-year renewal of a contract to provide promotional services in UK shopping centres owned and operated by M&G Real Estate.
The Network Rail contract builds on work the company has carried out for luxury brands such as Hennessy and Jaguar in St Pancras Station, London.
SpaceandPeople, which works in more than 750 venues across the UK, had been conferred preferred bidder status for the contract in June.
Highlighting the benefits to clients from the deal, SpaceandPeople noted that rail passengers have a longer dwell time than other venues and provide a receptive audience for a wide range of promotional and retail activity.
With statistics suggesting 25 per cent of visitors to stations such as King’s Cross do so to use the facilities, station-based retail businesses are now outperforming their high street counterparts.
Fiona Orford-Williams, senior analyst at Edison Investment Research, said the deal gives SpaceandPeople more “credibility and clout” in the eyes of its clients, emphasising that the footfall generated across the Network Rail sites is “enormous”.
Ms Orford-Williams said the company would incur costs in the short term as it delivers on the deal, but expects the benefits to come through next year.“It steps the whole company up a gear,” she said.
SpaceandPeople chief executive Matthew Bending said: “This is a significant win for us and it complements the existing successful shopping centre business we have built over the years.
“The Network Rail portfolio offers an extremely large footfall across the UK, which provides us with a unique opportunity to build a bigger network of transport hubs in the UK and Europe.”
Hamish Kiernan, retail director said: “We want to create truly exceptional places for our passengers and visitors, and as part of this aspire to bring a sense of theatre and interactivity into our stations.
“SpaceandPeople have unparalleled experience in creating experiential campaigns in high footfall places like stations, and therefore we saw them as [the] natural partner to help us meet this objective.”
The contract wins recently secured by SpaceandPeople come after the company experienced a “challenging and disappointing” 2014.
The company saw pre-tax profits slump to £762,000 from £2.4 million in 2013, with gross revenues falling to £31.6m from £35m. The results followed two profit warnings issued during the course of the year, although it performed strongly in the final four months.
The company launched a review of its management structure during the year and made wholesale changes to its board, leading to a slimmer leadership team and savings of £700,000.
No jobs were lost in Scotland but there were departures at board level and in operations overseas.
Forth Ports’ chief executive Charles G Hammond joined as chairman in October, while STV finance director George Watt and Steve Curtis were brought in as non-executive directors.
Shares in SpaceandPeople closed up 9.5p at 86.5p.
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