The Financial Times posted a loss of £32m during 2003, as advertising revenues slumped 15% and sales continued to fall. A cost-cutting programme across the business daily has failed to stem losses, which were £9m higher than in 2002, according to the full-year results of its parent company Pearson released today.
The company blamed a “savage corporate advertising recession” for the widening losses, as the paper’s key advertising categories slashed their budgets and the war on Iraq took its toll. Advertising revenues have fallen by almost two-thirds since their peak in 2000, the company said. During the same period the paper’s cost base has been cut by £100m.
But there is hope on the horizon. Ad revenues for the first two months of 2004 have improved and forward bookings are a little ahead of last year. “Although the outlook for our business newspapers remains uncertain, we expect the cost actions we have taken to reduce losses at the Financial Times by approximately £20m this year even without any advertising recovery,” the company said in a statement.
Last year Pearson spent almost £10m spent expanding the paper across the world. An Asian edition launched in September completing the global network of four regional editions.
Subscribers to FT.com rose by 50% during the year to 74,000, and overall profits to the FT Group, which includes French title Les Echos, were up 8%.
Pearson posted pre-tax profits of £410 million, compared to £399 million during 2002, and chief executive Marjorie Scardino was optimistic about the coming year.
“In the face of a tough business environment over the past few years we have improved our market positions through operating efficiency and product quality. We are now leaner, stronger and more ready for the better conditions we’re beginning to see ahead.”
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