Speaking after a brief EGM yesterday — at which shareholders unanimously approved INM’s sale of its remaining near 19% stake in Australian diversified media group APN — chairman Leslie Buckley said that part of the benefits from the latest disposal will be freeing the group up to consider more growth opportunities.
To that end, he said that management will begin to seriously run the rule over acquisition possibilities over the coming six months, with the focus being on the continuing strengthening of INM’s digital capabilities. He said INM has approximately €25m in the bank and is ready to do deals.
While group chief executive Robert Pitt told shareholders at the meeting that the sale of the APN stake — INM’s last remaining overseas asset — would allow management to build an island of Ireland-focused business, Mr Buckley told reporters, afterwards, that while that is the case, the board will remain open to opportunities based further afield.
“If something came up in the UK, maybe a partnership opportunity, we would look at that,” he said.
Yesterday saw shareholder approval for the €121m sale of INM’s remaining APN stake, a transaction on which tentative agreement was reached last month.
That deal also gives INM’s board the proceeds through which it will pay down the remainder of its already dwindling debt mountain, which stood as high as €420m just three years ago. The Rupert Murdoch-controlled News Corp is understood to be buying some of INM’s Australian shares.
Yesterday’s EGM saw 837.7m shares deployed in votes in favour of INM’s disposal, with only 192,152 voting against.
Mr Buckley was also asked, yesterday, about recent comments made by former INM chief executive Gavin O’Reilly.
In a wide-ranging interview with The Sunday Business Post earlier this month, which also touched on the changing face of media ownership and defence of his father over AIB moving in on a number of his assets to recoup loans, Mr O’Reilly — now resident in California and in charge of international entertainment booking agency TAG — described the exodus of management and editors at the media group in the aftermath of his acrimonious departure three years ago as being like “the killing fields”.
Mr Buckley yesterday angrily dismissed the comment as being “incredible” and “a very regrettable thing to say”.
He said the business had been “very badly managed” under Mr O’Reilly, adding that INM had high levels of debt at the time and was in a “perilous position”. He said the group had been “on the verge of collapse” and would have had to make far more redundancies, than it has done in recent years, if Mr O’Reilly had remained at the helm.
“If he was still there, there would have been jobs for less people and far more people being made redundant,” Mr Buckley said.
He added that INM was “on the verge of examinership or receivership”, under its previous management and said there had been the concern that it could end up like Waterford Crystal, once controlled by Tony O’Reilly Sr and ultimately bought out of receivership in 2009.
Mr Buckley also said that much of the headcount reduction necessary at INM in the past few years was partly due to Gavin O’Reilly’s “bad management”.
At the start of this year, INM announced further cuts to its editorial staff, with 30 people leaving as part of the group’s ongoing rationalisation efforts and implementation of a broader digital strategy and collective working environment across its main newspaper titles.
This move followed around 20 cuts made in 2013 and another 60 job losses last year.
Management said yesterday that the latest programme of change remains ongoing, but that progress has been made and its initial timeline of implementation — late June/early July of this year — is still a realistic one.
Whether the redundancies have run their course remains to be seen, however, with Mr Buckley suggesting that “there will always be the need for more efficiencies” if circulations remain under pressure.
Last month, INM reported a marginal fall in revenue, for 2014, from €322.4m to €318.7m; but saw operating profits jump by 4% — to €34m — on the back of a pick-up in online advertising revenue.
The group is due to hold its annual general meeting in early June. At last year’s meeting, Mr Buckley told shareholders that costs savings of around €20m were being aimed at over the course of 2014 and 2015; with headcount reduction, the optimisation of print titles, monetisation of online content, and growth in digital revenues all forming part of the process and longer-term growth strategy.
Immediate plans for an online pay-wall, a move away from group headquarters on Dublin’s Talbot St, and leveraging of staff and news content from Communicorp, the media group controlled by majority INM shareholder businessman Denis O’Brien, have all been dismissed in recent times.
Last year’s financial results also showed redundancy costs running up to over €9m, accounting for a large proportion of a €30m exceptional charge incurred.
While print revenue declined by over €2m to €105.4m, digital advertising revenue — roughly 11% of total group advertising annual revenue — grew by nearly 40%.