The downward spiral in demand for print advertising created a tough environment for publishers in 2016. But Time Out (TMO) - the company behind the eponymous city life magazine - has sidestepped these difficulties, thanks to its varied product portfolio.
True UK print advertising revenues trailed 2015, dragging overall global print revenues down 3 per cent at constant currency. But demand across the rest of the business is strong. Digital advertising sales increased by 28 per cent in 2016 as the group attracted brands including British Airways, Guinness and Nescafe. Chief executive Julio Bruno attributes this to the fact that Time Out can offer cross-platform advertising solutions (both online and in print) and target specific populations.
The new Time Out Market division - added via the canny acquisition of the Lisbon site last year - has also proved a useful new area of business. More than 3m people visited the market in 2016, while a 42 per cent increase in rental income from tenants helped nearly double pro forma, constant currency revenues. This division made adjusted cash profits of £1.1m, up from just £0.1m in the comparable period.
Broker Liberum expects the whole group to move into a cash profit position by 2018, but for the year to December 2017 has forecast pre-tax losses of £19.5m, from a loss of £15.1m in the reported period.
TIME OUT (TMO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 135p | MARKET VALUE: | £176m | |
| TOUCH: | 134-135p | 12-MONTHHIGH: | 159p | LOW: 124p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 93p* | NET CASH: | £47.5m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014** | 26.9 | -12.6 | na | na |
| 2015** | 28.5 | -21.0 | -40.6 | na |
| 2016 | 35.7 | -18.8 | -18.9 | nil |
| % change | +25 | - | - | - |
Ex-div: na Payment: na *Includes intangible assets of £70m, or 53p a share **Pre-IPO figures | ||||
