29th May 2014 09:29
LONDON (Alliance News) - Future PLC said Thursday that it will sell some print publications and shift from a premium London Stock Exchange listing to a standard listing, as it strips down its business to counter the ailing traditional print market.
Future, which also reported Thursday a widened pretax loss in the half year to end-March, said it will sell some of its sport and craft magazine titles to Immediate Media Company Bristol Ltd for GBP22 million in cash and GBP2 million in deferred revenue from magazine subscriptions, saying the disposal would help to simplify its business and fund its restructuring activities.
The media group and digital publisher intends to seek shareholder approval in order to transfer its listing to reduce its costs and increase its flexibility.
Future posted a pretax loss of GBP30.6 million, widened from a loss of GBP300,000 in the previous year, as revenue declined to GBP48.7 million from GBP54.6 million, and it posted an impairment of GBP26.0 million on the value of its waning traditional print assets.
Digital and diversified revenues rose 9% to GBP16.8 million from GBP15.4 million.
However this did not offset a 5% decline in traditional print revenues, which fell to GBP31.7 million from GBP33.4 million.
The company said that whilst its board was disappointed with the first half results, it had already taken "significant" actions to address its issues, including the appointment of new Chief Executive Zillah Byng-Maddick on April 1st, and a review of the organisation.
Future is planning a restructuring programme to simplify its business and drive it towards an "increasingly digital and mobile age", with a focus on revenue and margin growth in its core sectors, such as consumer technology.
It said it had faced difficult trading conditions during the period, and had been over confident in planning its business for 2014, leading to over-investment in some areas and generally increased costs. The company's US business continued to struggle, and Future opted to streamline the business in March to transition it more quickly to a digital model.
As a result, Future has cut over a third of its US staff.
"We have begun transforming Future and simplifying our business to focus on our core strengths and this will continue into the second half," the company said in a statement. "Looking forward it is likely that in the short term, this change will impact our bottom line but allow our longer-term margins to increase significantly."
Shares in Future were trading up 9.8% at 9.00 pence Thursday morning, having touch an intraday high of 9.50p earlier.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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