GWR Announces Board Changes As Results Come In Line With Expectations
Radio operator GWR Group has this morning reported full-year financial results in line with expectations and at the same time announced that chief executive Ralph Bernard is to become chairman of the group.
The company reported an increase in turnover of 24.4% to £127.2 million, whilst pre-tax profit before goodwill and exceptionals rose by 8.1% to £20.7 million. GWR said that revenues at its flagship station, the national Classic FM, were up by 22%, whilst local radio increased revenues by 16%.
For the year Classic FM’s total turnover was £33.5 million, an increase of 22%, while its EBITDA earnings increased by 38%.
The year has been a busy one for GWR, including the group’s largest acquisition of radio assets to date, in the purchase of DMG Radio (see Revenues On The Rise At GWR As Investments Eat Into Profits) and Marcher Radio Group stations. It says it has also made ‘sound progress’ in developing its digital radio and internet activities. The investment in digital radio and internet developments has contributed to a fall in the headline earnings per share this year by 1.6% from 12.9p to 12.7p.
Finance director Patrick Taylor is reported to have confirmed in the company’s presentation this morning that advertising revenues for April and May are down by 9% year on year, without any obvious signs of an upturn. However, radio is currently performing better than television.
As experienced by Scottish Radio Holdings (see City News), local advertising is performing more strongly than national at present, although advertising across the board is weak.
Meakin nevertheless offered a positive outlook for the coming year: “We have started the new financial year in difficult advertising market conditions. Our forward order book is traditionally short term but we are confident that when advertising expenditure increases GWR will be in a strong position to benefit.
“The radio industry is forecast to grow faster than any other traditional medium and the Group has a strong portfolio of assets which represent real growth potential. With our new technology platforms providing greater efficiencies and with the prospects of a more liberal ownership regime, we remain confident of the future for GWR.”
By 11:00am today GWR Group shares were up 2½p at 445p. The whole of the radio sector tumbled recently when Capital Radio issued a second profits warning and Scottish Radio Holdings called off merger talks (see Insight Analysis: Radio Shares Take A Dive). Capital Radio was subsequently downgraded by ABN Amro (see ABN AMRO Reduces Forecast Following Capital Profit Warning).
