The Denis O’Brien-owned media group sustained the losses after revenues at the group declined by 23% from €85m to €64.9m to the end of December last.
National radio stations, Today FM and Newstalk are just two of the stations that the group operates and it is the number one commercial radio station operator in Ireland and three of other eight countries it which it operates.
The group’s earnings before interest, tax, amortisation and depreciation (EBITDA) last year declined by 34% from €17m to €11m.
After the non-cash items of depreciation and amortisation totalling €8.3m are taken into account, operating profits fell by 64% from its record €7.5m in 2008 to €2.7m last year.
However, bank loan interest repayments totalling €7.5m arising from the group’s expansion programme, that included the acquisition of Today FM, pushed the group into the red with a pre-tax loss of €5.2m. The high interest payments stem from the €128.7m paid out in 2008 following the acquisition of Today FM and a number of smaller stations in Bulgaria and the Czech Republic.
The loss last year resulted in the group’s retained losses totalling €38.3m.
The directors’ report states: “Market and trading conditions were difficult in the Irish and European radio markets. In the global economy all advertising revenue was down and radio advertising was no exception.
“This resulted in a decline in revenue year on year and in order to secure the long-term future for all stakeholders in this changing environment the group was required to focus on cost reduction.”
The directors stated that “in line with other media organisations, the group implemented pay cuts across the board” and said “these cost reductions have helped secure the future of the group and the group has a firm platform for continued growth”.
The returns show that the numbers employed by the group declined by 39 or 5% last year to 740, with the group’s staff costs reduced by 15% from €23.2m to €19.5m.
The accounts show that Communicorp’s Irish business accounts for 58% or €37.8m of the group’s revenues with the remaining €27m generated in the rest of Europe.
Revenues at the group’s Irish stations sustaining a 24% drop in income compared to 22% in the group’s European business.
The directors state: “We will maintain our strategy of managing the portfolio intensively, focusing tightly on managing cash resources while retaining a cautious outlook”.
The group had bank loans of 103.6m at the end of 2009 and an interest free loan of €90.5m from Mr O’Brien.