UTV Media Plc Interim Management Statement

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This Interim Management Statement covers the period from the beginning of the Group’s current financial year, 1 January 2012 to the date of this announcement and incorporates the Group’s ten month trading period ended 31 October 2012.

 

10 Months to end October

2012

2011

% Change

 

£m

£m

 

Group Revenue

99.5

99.8

-

Radio GB

46.0

43.6

5

Radio Ireland

17.0

18.2

(6)

Television

26.5

28.5

(7)

New Media

10.0

9.5

5

 

  • talkSPORT to broadcast exclusive UK radio commentary of 2013 Rugby Lions Tour
  • talkSPORT becomes Global Audio Partner of the Barclays Premier League through to 2016
  • talkSPORT signs worldwide commercial radio rights to FA Cup and Capital One Cup through to 2018 and 2016 respectively
  • Successful re-financing of banking facilities and continued reduction of debt
  • New network affiliate agreement with ITV
  • Acquisition of Simply Zesty – Ireland’s leading social media agency

Radio GB
In our largest division, revenue over the period increased by 5% with talkSPORT growing by 8% and our Local Radio business by 1%. The UK radio market increased by 4% over the same period. We anticipate that our revenue in November and December will be 2% above last year. As the start-up costs of the talkSPORT International project have been largely incurred by Tibus and Simply Zesty these costs will not be treated as exceptional by the Group.

Radio Ireland
In local currency terms Radio Ireland maintained its revenue over the period, significantly outperforming the Irish radio market which is estimated to have declined by 8% over the same period. Currency translation losses, however, led to a 6% deduction in reported revenue. It is anticipated that revenue performance in November and December will be down by 5% compared to last year on a local currency basis.

Television
Total revenue for the period decreased by 7% with Net Advertising Revenue (NAR) down by the same amount. Our London NAR declined by 1% which was in line with the UK TV broadcast market. NAR generated by our Irish offices experienced a decline of 16%. NAR for November and December overall is expected to be down by 11% compared to the same period in 2011 due to continued difficult trading conditions in Ireland.

New Media
Revenue increased by 5% compared to the same period in 2011. Excluding Simply Zesty, the like for like decline in sales for the period to October was 4%. Revenue in November and December is
expected to maintain the same rate of growth as the first ten months. We expect that recent restructuring within New Media, coupled with the absence of large internal projects next year, will result in an improved performance in 2013.

Net Debt
We continue to place a strong emphasis on cash generation and debt management. Our Net Debt at 30 September 2012 was £53m (£60m at 30 September 2011) and we anticipate that it will reduce further by 31 December 2012.

Outlook
The headwinds to trading which we experienced in Quarter 3 continue into the first weeks of Quarter 4, with macroeconomic conditions in the UK, to which advertising is so sensitive, still showing signs of volatility. In Ireland, where we continue to outperform the radio advertising market, challenging conditions persist for both television and radio into Quarter 4, with further revenue declines anticipated.

On a positive note, our GB Radio operations continue to deliver a strong performance overall, and we anticipate a stable outlook for GB Radio across Quarter 4. Outside of the UK, talkSPORT International is building both audiences and revenues in line with expectations several months into the project.

With limited visibility, we remain cautious about the prospects for revenue growth across our key business divisions. Despite investment in future profit streams, we continue to keep a tight control over costs, the Group remains cash generative with relatively low borrowings and is well positioned to take advantage of growth opportunities.

UTV’s next scheduled announcement of financial information will be the release of our preliminary results (to 31 December 2012) which is provisionally scheduled for 19 March 2013.

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