Profits down at media group Archant

REGIONAL media business Archant has announced a fall in operating profits for the year to December 31, 2008, against a background of continuing economic uncertainty and declining advertising revenues in all major categories.

REGIONAL media business Archant has announced a fall in operating profits for the year to December 31, 2008, against a background of continuing economic uncertainty and declining advertising revenues in all major categories.

Archant, whose titles including the East Anglian Daily Times, saw turnover from ongoing operations fall by 9.2% to �174.0million, compared with �191.6million in 2007.

Total operating profits fell by 27.1% to �22.2million, against �30.5million the previous year, despite a 6.4% reduction in operating costs.

In a preliminary statement to shareholders, chairman Richard Jewson identified significant declines in recruitment and property advertising revenues in the group's newspaper business and in property and display advertising in its Life magazines as contributors to the decline in operating profits, although these were offset by progress in the development of on-line activities and revenue.

On-going newspaper and printing operations saw a 31.8% decrease in profits to �16.2million, while magazines and contract publishing saw profits down 17.9% at �5.8million.

However, online activities saw revenues increase by 51.1% to �3.8million, driven by the further development of jobs24.co.uk and on-line display advertising, while average monthly unique visitors and total annual page impressions increased by 45.4% and 40.6% respectively.

Pre-tax profits, before exceptional items, were down 61.6% at �8.4million, against �21.9million in 2007.

“However, the continuing deterioration in underlying title performance, as the economy has weakened, has resulted in certain of our acquired newspaper and magazine assets held on the balance sheet being no longer supported by their current underlying profitability,” said Mr Jewson.

“The financial statements are therefore impacted by an impairment charge of �33.6million. The impairment charge has no cash impact but has the effect of producing a pre-tax loss of �25.2million for the year.”

Mr Jewson added: “We expect the difficult trading conditions, which have deteriorated through the last few months, to continue for 2009 and beyond. It is impossible to know the timing and extent of any recovery and difficult to foresee the shape and scale of our industry in the years ahead.”

Archant's annual general meeting takes place on Thursday, April 30 at the Assembly House in Norwich.