The creation of Emap’s internal advertising sales house, Emap Advertising, caused enough disruption to have an adverse effect on consumer magazine advertising revenues, according to the company’s first half results, released today. The company stated that “the disruption created by the formation of Emap Advertising resulted in consumer magazine advertising under-performing in a reasonably buoyant market.”, resulting in a drop in magazine advertising revenues of 3% year on year.
Emap’s chief executive, Kevin Hand, commented: “It has been a challenging six months for Emap, with some disappointments but many positive achievements.”
Despite the difficulties in magazines, total revenue for the six months to 30 September was up 3% at £567m, up from £549m year on year. This was thanks to the fact that radio airtime sales rose 26%, B2B display advertising 10% and B2B recruitment advertising 27%.
Pre-tax profit remained level at £92m. Much of the group’s focus during the half year has been on improving margins in France and “establishing firm control” of US operations. Investment in core business during the first half included a £9m launch spend which focussed on entertainment magazine Heat and international editions of men’s title FHM. Last year £10m was spent on similar activities.
Emap stated that it feels confident of achieving its full year targets, overcoming the difficulties experienced in magazine advertising revenues. “The trends in UK consumer magazine copy sales remain positive.” Emap says, “Consumer advertising will improve after a difficult start to the year.”. The group also expects strong growth in radio airtime sales and B2B recruitment revenue to continue.
Market reaction to the interim results had brought shares in Emap down 11p to £8.19 by 11.30am today.
