INM back in profit after selloffs

THE asset disposal cycle at Independent News & Media (INM) has run its course, with ongoing debt reduction to be delivered through organic means, management said on the back of strong first half results.

The first six months of this year saw INM record a 39.2% year-on-year increase in pre-tax profit to €53.3 million (before exceptional gains) and a near 8% rise in revenues, to €656.5m. Operating profit was up by 29.2%, at €94.6m; EBITDA rose by just over 26%, to €115.6m; and earnings per share amounted to 5.4c, reversing a half-way stage loss per share of 28.2c last year.

Management also said that, while still challenging, the advertising market continued to show signs of improvement and average revenue declines were now down to single digit percentages. INM’s underlying ad revenues, for the first six months, were up by 1% on a like-for-like basis.

The media group’s high profile financial restructuring and ongoing debt reduction programme has seen it make numerous disposals over the course of the past 12 months, most notably its two London Independent newspaper titles, its outdoor advertising division in South Africa and its stake in Indian media group JPL.

INM chief executive Gavin O’Reilly said nothing, in terms of disposals or acquisitions, is on the cards and the immediate future growth of the business will emanate from existing assets. “We’ve sold all the assets that we want to sell. The assets we now have are the assets that will continue to drive our growth. The strategy remains to continue to accelerate the pay-down of debt but that will be done through organic measures,” Mr O’Reilly added.

Net debt has been reduced by 42%, to just under €979m, since June of last year. Mr O’Reilly said further casualties among newspaper titles, particularly regionals, would not be surprising, but stressed all of INM’s regional titles are currently profitable.

He also said management is “optimistic” about the pending re-launch and overhaul of the Sunday Tribune, adding the title still has “room and relevance” in the INM stable.

Mr O’Reilly also said his working relationship with Denis O’Brien, now the group’s single largest independent shareholder, was “good” and Mr O’Brien’s investment in the group was a vote of confidence in the strength of the INM brand.