UTV investors set for windfall

Shareholders in UTV Media are in line for a 17% increase in their annual dividend, despite the Belfast-based broadcasting group suffering a 10% fall in profits for 2012.

UTV yesterday reported on what its management called “a robust performance in what continues to be a challenging economic environment”, for 2012. The group lowered its net debt from £54.7m to £49.4m; but pre-tax profits for the year were also down by 9.87% to £21m and group revenue fell by 1.2% to £120.1m.

Operating profit was down from £26.8m to £23.9m, and diluted adjusted earnings per share fell from 18.96p to 16.92p.

A final dividend of 5.25p has been recommended by the group’s board; which will bring — if approved — the full-year dividend, for 2012, to 7p; up by 17% on 2011 and by 75% on 2010’s levels.

UTV’s dividend payments have been constrained, in recent years, by the need to reduce net debt.

Management said, yesterday, while that need still remains, with the group’s net debt now down by 54% on what it was four years ago and with its net debt-to- EBITDA ratio below two times; it is “appropriate” to continue a progressive dividend policy.

On a divisional basis, overall group radio operating profit grew from £18.9m to £19m; but television profit fell from £6.5m to £3.9m. UTV’s new media arm saw its revenue grow from £11.4m to £12.3m.

The group’s British radio interests saw operating profit rise by just under 5%, last year, to £12.9m; but the Radio Ireland portfolio — which includes the likes of Cork stations C103 and 96FM, Limerick’s Live95 FM and Dublin stations Q102 and FM104 — suffered a 6.56% drop in operating profit to £5.98m.

The group said it expects its Irish radio ad revenue to be down by 6% for the first quarter of this year; similar to its UK radio business.