Substantial interest in ‘Business Post’
Mr Justice Peter Kelly confirmed the appointment of Michael McAteer of Grant Thornton as examiner and said the protection of the court continued to be afforded to the company.
The judge said the newspaper is unfortunately insolvent and in the unhappy position shared by several other companies which have been assailed by the economic storms which have buffeted the country for many years. The newspaper, he said, had seen dramatic downturn in its fortunes and the primary cause was the drop in advertising revenue, which fell by 68% in a five-year period, as well as a drop in circulation revenue.
Referring to the expressions of interest in investing in the company, he said the fact that there was interest suggests the company has a reasonable prospect of survival. On the evidence before him he was satisfied the newspaper had a reasonable prospect of survival. He said it was a well-managed company with an established readership.
Cian Ferriter SC, for Post Publications Ltd, told the court the newspaper was not in a position to pay its debts. On a winding-down basis a liquidation would leave deficiencies of over €6.5m, he said. The newspaper was loss-making and had not shown an operating profit since 2007, he said.
As a result of the general economic decline, revenues fell from €15.6m in 2007 to €7.3m in 2012 — a 53% drop, he said.
Circulation figures show that 40,000 copies are sold every weekend and it has a readership of 140,000. Circulation revenue fell from €4.9m in 2007 to €3.69m last year. Management, he said, had introduced cost savings including a substantial reduction in wages for its 76 full-time staff.
The company’s liabilities now exceed the assets, he said, adding that the projected cost of printing during the protection period is expected to be €8,000 a week per issue.
Counsel said it was clear there was an underlying viable business and that it was expected to return to profitability by 2014. The case, he said, was tailor-made for the court’s protection.
Rossa Fanning BL, for the examiner, referring to the eight expressions of interest, said confidentiality agreements had been issued. The examiner agreed the company had a reasonable prospect of survival as a going concern and was in discussions with the landlord of its offices at Harcourt St, Dublin for a reduction in the rent down to market levels.
The case will come before the court on Apr 9, when Mr Justice Kelly will be updated on progress to date.
