INM seeks meeting with shareholders

Independent News and& Media management is looking to meet with major shareholders — including Denis O’Brien — to gauge their concerns ahead of another potentially fractious AGM in early June.

It was reported yesterday that Mr O’Brien and Dermot Desmond — who between them control almost 28% of INM — are looking to push for a shake-up of the group’s board, including the removal of chief executive Gavin O’Reilly at the Jun 8 AGM.

Yesterday, Mr O’Reilly said every shareholder had the right to voice their opinions and concerns, but seemed to doubt the motives of Mr O’Brien, who has a 22% INM stake.

He said that management was offering meetings with certain shareholders, as it was important for investors to “have all the facts”.

“I think I have a very, very strong and clear mandate from our shareholders — 99.8% of whom voted in my favour at last year’s AGM — a very supportive board and a strategy endorsed by the board. We’re doing all the company wishes us to do,” he said.

The INM chief added that despite the poor economic and advertising climates, the group had managed “a very sturdy performance” in 2011, “doing better than any other media operator in this country”.

Both high-profile shareholders have previously voiced concerns over INM’s management — Mr Desmond, via a representative at last year’s AGM, and Mr O’Brien most recently last November, on the back of the group downgrading its profit forecasts.

At that stage, Mr O’Brien issued a statement saying Mr O’Reilly’s position had become untenable, having presided over “a near total collapse in shareholder value” and losing investor confidence.

Mr O’Brien made no comment yesterday.

INM yesterday reported annual results showing an 8.6% drop in operating profits to €75.5m and a pre-tax loss — due to one-off exceptional charges — of €63.6m.

Group revenue was down by nearly 11% at €558m; although dropped by only 5.6% when a four-month 2010 contribution of the group’s former London newspaper titles was excluded.

Despite offering a gloomy outlook for the advertising market this year — INM is forecasting a low single digit percentage drop in advertising revenue for 2012 — Mr O’Reilly said he expects INM “will continue to be very profitable during 2012”, although he noted that this would not, necessarily, equate to any increase in profits.

All free cashflow this year will go on continuing to lower net debt — which fell by nearly 10% to €426.8m in 2011.

Mr O’Reilly suggested that going from a debt to equity position remains a core goal for management and will be the best way to boost shareholder value.


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