Flagging interest in newspapers among consumers and advertisers weighed on Independent News & Media (INM) in the first half. But robust digital and distribution growth, combined with cost reductions, pushed the Irish Independent publisher's operating profits before impairments and other one-offs up 3 per cent.
Sales of print adverts and circulation revenues fell by 8 per cent and 5 per cent respectively. But the average number of unique monthly visitors to INM's independent.ie website swelled 9 per cent to 9.4m. Combined with strong demand from brands for new online advertising formats, that drove digital ad sales up 23 per cent.
Management is working to reduce the distribution segment's reliance on newspapers. But it couldn't turn down a wholesale contract with The Irish Times in the second half of 2015, or a deal to distribute Belfast paper The Irish News in the Republic of Ireland. Meanwhile, the closure of the Belfast printing operation, coupled with the integration of the group's print and digital newsrooms, helped to lower adjusted operating expenses by about 9 per cent.
INM's directors took full control of CarsIreland.ie and Greer Publications, and continue to review further acquisitions. Ahead of these results, broker Davy expected adjusted pre-tax profits of €38.4m for the full year, giving EPS of 2.7¢ (€78.6m and 2.6¢ in 2015).
| INDEPENDENT NEWS & MEDIA (INM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 14.1¢ | MARKET VALUE: | €197m | |
| TOUCH: | 13.8-14.5¢ | 12-MONTH HIGH: | 18.5¢ | LOW: 12.5¢ |
| DIVIDEND YIELD: | nil | PE RATIO: | 6 | |
| NET ASSET VALUE: | 3¢* | NET CASH: | €62.4m | |
| Half-year to 30 Jun | Turnover (€m) | Pre-tax profit (€m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 157 | 13.4 | 0.8 | nil |
| 2016 | 162 | 19.5 | 1.3 | nil |
| % change | +3 | +46 | +63 | - |
*Includes intangible assets of €48.3m, or 3¢ a share £1=€1.17 | ||||
