Profits down at Archant but chairman forecasts better times ahead
The chairman of media group Archant said moves to transform the business have helped the firm weather the economic storm and will see improved performances in the coming months – as results for the first half of the year showed that profits fell by �4.4m.
Interim results for the Norwich-based firm, which produces four daily news-papers, including the EDP, Norwich Evening News and about 60 weekly titles, showed that total revenue in the period had declined �2.8m (4.0pc) to �67.3m. Operating profit before amortisation of intangible assets and exceptional items was �2.6m – down �4.4m.
Group chairman Richard Jewson said performance of the business had been adversely affected by reductions in news-paper print advertising, which had been driven by economic factors including government cutbacks and steep increases in input prices. Operating costs also increased by �1.6m, including �1.1m for newsprint.
Taking exceptional items and amortisation into account, Archant posted a �1.9m pre-tax loss. Newspaper and printing turnover, excluding acqui-sitions, was down 7.2pc at �44.9m due principally to reductions in print advertising revenues which fell 13.2pc.
The results also showed that the number of employees engaged in the newspaper business had reduced by 9.9pc in the period with the first half of the year seeing job losses among editorial staff both in Norfolk and at Archant Print, based at Thorpe St Andrew.
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However, magazine revenues increased 2.8pc to �22.3m with property advertising revenues up 11.9pc and subscriptions revenue up 1.4pc.
Total digital revenues grew 3.3pc to �3.1m with digital dis-play revenues increasing 10.9pc. Unique visitors to web-sites have also grown by more than a third, to an average of 3.6m per month, in part attributed to the increasing use of social media.
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Business developments during the period included launching daily deals site tickles.co.uk and 40Winks.co.uk, a group buying site for short breaks and the relaunch of the homes24 online property site working in partnership with Zoopla.
'We are transforming our traditional businesses for the changing world and developing new businesses, taking full advantage of changes in technology,' Mr Jewson said.
'We are not waiting for the economy to improve to take action, and provided there is no further deterioration in our markets, we expect better profits in the second half to achieve our forecast for this year and to achieve growth in profits in 2012.
'The continuing success of our strategy to grow paid-for circulation volumes is evi-denced by the growth in circul-ation revenues (up 1pc) and, notably, three of our four daily titles and almost all of our paid for weekly titles outside London achieving paid circulation volume growth in the first half year,' he added.