The remarkable recovery at publishing group Trinity Mirror (TNI) continues apace. These first-half results, after adjusting for certain one-off charges, amortisation and foreign currency movements, show profits and cash flow are holding up well despite consistent revenue declines.
Adjusted pre-tax profits increased to £49.3m from £48.1m a year ago, generating underlying EPS of 15.4p compared with 14.6p. That's despite group-wide revenues falling 12.6 per cent in January and February, and then by 6.6 per cent from March to June. Encouragingly, July revenues are only down 6.5 per cent.
Yet Trinity Mirror has been able to keep generating strong cash flow by relentlessly cutting costs and focusing on "efficiency" savings, as well as increasing prices for certain publications. And the group is ploughing back the cash into select growth areas as well as paying down debt. Net borrowings were down a quarter to £120m from £157m six months ago, and from £181m a year ago. Moreover, management expects to repay a further £54.5m in October without having to draw on a new facility.
Barclays forecasts adjusted pre-tax profits of £92m in the current year, generating adjusted EPS of 28.5p, falling to £80m and 24.5p in 2014 (from £99m and 29.9p in 2012).
TRINITY MIRROR (TNI) | ||||
|---|---|---|---|---|
| ORD PRICE: | 115p | MARKET VALUE: | £296m | |
| TOUCH: | 114-115p | 12-MONTH HIGH: | 130p | LOW: 27p |
| DIVIDEND YIELD: | nil | PE RATIO: | 64 | |
| NET ASSET VALUE: | * | NET DEBT: | £120m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012** | 363 | 30.4 | 14.6 | nil |
| 2013 | 332 | 30.3 | 9.6 | nil |
| % change | -9 | - | -34 | - |
*Negative shareholders' funds of £664m, includes intangible assets of £0.9bn, or 354p a share **Restated | ||||
