Capital Takes Stock As Ad Slowdown Persists
The management at Capital Radio remain confident about the future performance of the group despite interim results which showed a 15.5% fall in profits.
There appears to be little prospect of a recovery in the short term with the company admitting that combined April and May revenues will be broadly flat.
“At this stage, June is experiencing weak demand and we continue to manage our business on the assumption that the advertising market will remain under pressure for the rest of our financial year,” said Capital in a statement.
The radio company has been doleful about the state of the ad economy all year (see Capital Sees Revenues Down 5% In First Half) and Nielsen Media Research claims that advertising revenues at Capital 95.8 FM fell by almost 15% in the first quarter of 2003. The flagship London station has also seen its weekly reach decline by 10.5% year on year and there has been lingering speculation over the future of breakfast show presenter Chris Tarrant.
However, the popular DJ seems set to stay for the foreseeable future (see Good News For Capital As Tarrant Plans To Stay) and with the Communications Bill likely to result in a shake-up of the UK radio landscape, there are grounds for optimism at Capital’s Leicester Square headquarters.
“The introduction of regulatory changes later this year will present transforming opportunities for the UK commercial radio sector,” said chief executive David Mansfield. “Our strong balance sheet, operational synergies and acquisition track record, provide us with the leading position to take advantage of potential consolidation opportunities.”
Shares in Capital Radio were unchanged at 430p at 12:30 today.
