DMGT Pre-Tax Profits Up £260 Million

The company says that this improvement was mainly due to strong growth from DMG Information. The Group’s business-facing divisions generally enjoyed strong growth, whilst its consumer operations, particularly its newspapers, performed creditably under difficult trading conditions.

The digital operations of its newspaper divisions expanded rapidly and are producing good returns. 47% of this year’s operating profit was generated other than by the Group’s print newspaper titles, up from 40% last year.

The new financial year has started well for DMGT with signs of a gentle recovery in some sectors of the national advertising market with national titles producing strong circulation results. Whilst Northcliffe is not yet seeing much improvement in advertising conditions, continued falls in revenues are being offset by cost reductions.

The Group expects DMG Information to maintain its strong underlying revenue growth, albeit with profit growth possibly tempered a little this year by investment in new products, and for Associated Northcliffe Digital to have another growth year. Pre-tax profits should also benefit from Euromoney Institutional Investor’s continuing organic growth and from its acquisition of Metal Bulletin.

Associated Newspapers achieved operating profits of £97.0 million, up from £95.9 million last year, on revenues down 1% to £931 million. This result was a record for the third successive year and was achieved despite a further decline in the print advertising market, a newsprint price increase well ahead of inflation and the launch costs of a new free title, London Lite.

It resulted from close attention to costs, particularly at the Evening Standard, and from growth in profits from digital activities. Total costs were £11 million lower than last year, despite spending £7 million more on newsprint.

DMGT announced in September that advertising revenue for both its national and regional divisions had declined year on year for the 11 months to the end of August, with Associated Newspapers seeing total advertising revenues fall by 2% (see DMGT Ad Revenues Decline). In July, Associated Associated Newspapers made three online acquisitions as part of its continuing strategy of making investments to increase its exposure to key areas of the online advertising market (see Associated Newspapers Strengthens Online).