Emap today announced that pre tax profits were up 12% for the year, spurred mainly by growth in the UK magazine and B2B sectors but today’s share price dropped by over 9% as the group warned competition in the French TV listings market and the weakness of Euro would impact the coming year’s profitability.
Profits reached £196 million for the year ending 31 March 2004, thanks to a strong performance from UK magazines,
Closer, which Emap describes as being ‘the best ever launch’ and men’s weekly,
Zoo. However, commenting on next year’s performance, the group’s finance director, Gary Hughes said in an announcement following the group’s results: “We’re still expecting profits and revenues to grow again this year but not as much as what people expected.”
Consumer magazine revenue grew by 4% to 5% during this year, outperforming the market which grew by only 2%. The statement says, that celebrity gossip magazine, Heat, now in its fifth year, continues to grow advertising revenues significantly.
Circulation of Closer has reached 450,000 a week, raising the possibility that it may eventually overtake Heat as Emap’s biggest selling weekly magazine in the UK. Zoo, launched in January 2004, is already ahead of circulation and advertising revenue targets, says Emap, with in excess of 150,000 copies a week being sold.
Radio advertising revenues grew by 6% during the year, largely due to revenues from digital radio. Emap owned, Kiss 100 and Magic 105.4, balanced out a weaker performance from Big City.
Performance in the B2B division also experienced a strong performance, with turnover growing by 9% throughout the year, with recovery in B2B advertising and strong core exhibition revenues boosted by the acquisition of new shows in Europe and the UK.
Chief Executive, Tom Moloney, said: “This is another strong set of results, delivered against a backdrop where trading conditions have been mixed. Our core business performed well and this was enhanced by exciting new product launches and solid bolt-on acquisitions.”
Looking forward, the group said: “The increased competition in the French TV listing market, together with the weakening of the Euro, is impacting the profitability of Emap France to a greater extent than expected. However, we expect a continued strong performance from the UK. Bearing all of these factors in mind, the Group expects to be able to deliver another year of reasonable progress in 2004/2005.”
Moloney added: “The competition frenzy in the TV listing market in France will continue to hit Emap’s business there.”
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