28/08/2009

UTV Hit Hard By Recession

A regional TV station is reporting a sharp drop in advertising revenue.

UTV Media in Belfast has this week posted a sharp drop in pre-tax profits for the first six months of the year, blaming the ongoing slump in advertising revenues during the recession.

The company, which owns the North's ITV franchise and more than 20 radio stations elsewhere in the UK and in Ireland, revealed pre-tax profits for the period were down 30% to £7.8m and group operating profits dropped 29% to £11m.

Overall revenues were down 10% to £54.5m compared with the first half of 2008.

UTV's television division saw operating profits fall 61% from £4.7m to £1.8m with TV ad revenue down 23% in the first six months to £14m.

However, while television advertising revenue from Great Britain was broadly in line with the market, advertising revenue from the Irish Republic dropped by 40% in the half year reflecting reduced sales from multi-national customers.

Advertising revenue from Northern Ireland was relatively resilient, with only a 6% decline.

The company's radio business saw a 16% drop in operating profits to £8.2m.

UTV noted "an improving trend" in its radio division in Great Britain but said its Irish radio unit had seen a worse than anticipated decline in sales on a like for like basis.

UTV will not pay a dividend.

The news came at the same time as two of Northern Ireland best known newspapers are also reporting significant losses.

The world's oldest English language title, the Belfast News Letter and the Belfast Telegraph are suffering plummeting revenues.

The 'Tele is owned by Independent News & Media which has suffered a loss with advertising revenue not expected to recover this year.

It made a pre-tax loss of €48.5m (£42.7m) for the first six months of 2009, compared with a €96.6m profit in the first half of 2008.

The company warned that its full-year earnings would be at the bottom end of current expectations.

Advertising revenue was down 19.6% in the period and no recovery is expected in the second half of the year.

The News Letter publisher, Johnston Press, has also seen a decline in advertising in the recession.

Its advertising revenues shrank 32.7% in the first half of the year, with recruitment and property advertising particularly hard hit.

The firm, which also owns the weekly Times series that covers the whole of Northern Ireland, is also the publisher of the famous Scotsman, the Yorkshire Post.

See: Belfast 'Tele Reports News Of Losses

(BMcC/GK)

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