Interim profits took a tumble at Daily Mail and General Trust (DMGT) but the newspaper publisher and exhibitions organiser is sticking with its full year outlook.
Adjusted operating profit fell 8% to £133m from £144m the year before while adjusted profit before tax tumbled 14% to £105m from £121m a year earlier. DMGT has adjusted its figures to reflect acquisitions, disposals, closures and
non-annual events in the current and prior year; the percentage changes are calculated using constant exchange rates.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Get 6 issues free
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Revenue in the six months to April 1st eased 2% to £973m from £991m at the interim stage last year, but was up 3% on an underlying basis.
The Business-to-Business (B2B) operations saw underlying revenue rise 9% year-on-year (y/y) and underlying profit improve 14%.
Associated Newspapers, the division which publishes the Daily Mail, saw a 10% decline in print advertising revenues but this was offset by strong growth in digital advertising (+21% y/y) and increased circulation revenue (+4% y/y) generated by an increase in cover prices.
Somewhat improbably, the Daily Mail, which has a reputation for a conservative, older readership, is one of the world's most popular online newspaper sites; at the end of 2011 it usurped the New York Times's web site as the most visited online newspaper site in the world.
Operating profit at regional newspapers operator Northcliffe Media was up 34% on an underlying basis, and the improved profitability is expected to be maintained in the second half.
Group underlying earnings per share slumped 17% to 19.5p from 23.6p.
Net debt rose £90m in the period to £809m but is expected to narrow in the second half of the financial year.
DMGT expects to benefit from the continuing strength across its B2B companies with the net effect of non-recurring events within the events business being much less pronounced in the second half.
"Within A&N Media, whilst trading since the start of April has seen advertising revenues below last year, Associated expects to achieve profit growth due to the benefit of previous cover price increases, some advertising and circulation revenue benefit from the Olympics, a strong digital performance and a continued focus on costs," the group said.
As a consequence, the outlook for the full year remains unchanged and the board expects to see growth in earnings for the full financial year, compared to the equivalent figure for last year.
The shares were down 9.1p at 396.6p in mid-morning trade.
JH
'We face a £6m inheritance tax bill under Reeves's changes – it's sheer terror'
Millions of over 50s fear pension investment risk – how should you position your portfolio?
