The first full year since the acquisition of Grampian Television by Scottish Media Group (SMG) (see Scottish Media Soars On Merger Talk) has seen the latter’s broadcasting turnover increase by 15% to £115.8 million in the year ended 31 December 1998. Year on year ad revenue grew by 6% for Grampian and 3% for SMG’s other broadcasting division, Scottish Television (STV). This compares to growth of 5% for the ITV Network as a whole.
SMG says that the revenues for STV were held back as a result of Proctor & Gamble, a major advertiser, reducing spend in Central Scotland by £2 million to test the effectiveness of their advertising campaigns.
“We have continued to develop the commercial and programming strengths of our channels and have revamped our regional programmes during 1998 in addition to securing a four year agreement for Scottish football television rights,” the company said this morning.
Newspaper publishing turnover grew slightly from £62.5 million to £63.6 million on the back of advertising revenues up by 5%. National display advertising grew by 13%. Overall circulation for SMG papers, which include the Herald, fell slightly over the year. The company launched a new Sunday paper, the Sunday Herald into the Scottish market, on 7 February this year.
“While we have had a very successful year in developing and improving of our existing businesses we were not able, during 1998, to complete the next step of our corporate development and expand outside of Scotland,” says Calum MacLeod, acting chairman. However, In January 1999 Scottish Media made its first move into business outside Scotland with a £35 million bid for outdoor company, Primesight (see Scottish Media Moves Into Outdoor With £35m Primesight Bid).
In February 1998, Scottish Media sold its 18% investment in Ulster Television for £23.9 million (see Scottish Media Sells Ulster Stake). SMG’s 20% stake in GMTV is also currently under review.
“Scottish Media Group remains financially robust and is very well placed to continue its development both organically and through further acquisitions. Primesight offers us an entry into a complementary and fast growing media sector with much potential for future development. I am confident that the strong management team we have in place will continue to grow this business, improve performance and create further shareholder value,” says MacLeod.
The company this morning reported pre-tax profits up by 12% to £46.0 million and operating profit up by 15% to £48.6 million. Earnings per share grew by 7% to 49.8p. Since the beginning of trade this morning, the Group’s share price had fallen by 17p on Friday’s close to stand at 865p by midday today.
Scottish Media Group: 0141 446 7000
