3rd Aug 2015 07:12
LONDON (Alliance News) - Trinity Mirror PLC Monday expressed confidence that its profits for the full year will be in line with expectations despite a more challenging print advertising market than it had anticipated, and it posted a fall in pretax profit for its first half.
For the 26 weeks to June 28, pretax profit fell to GBP12.1 million from GBP50.5 million a year before, as revenue fell to GBP288.5 million from GBP324.5 million, partly as a result of a GBP16.0 million increase in its provision in relation to the ongoing phone hacking litigation and a GBP27.5 million exceptional gain in the previous year that did not recur.
On an adjusted basis, stripping out restructuring charges, amortisation and other exceptional costs, pretax profit fell to GBP47.0 million from GBP48.2 million.
Trinity Mirror said it has seen continued pressure in print national advertising markets with a slowdown in retail spend, particularly in supermarkets, but also in telecoms, motors and entertainment. This offset growth in its digital revenue, where publishing digital revenue rose 27% and publishing digital display advertising rose by 44% in the first half.
The company said that whilst the market remains challenging in its first half, revenue trends in July were better than those it experience in May and June. However, monthly revenue trends are expected to remain volatile for the rest of the year.
Despite this, Trinity Mirror still expects its profits for its full year to be in line with expectations, although it did not specify if those expectations were internal or not.
It is now targeting cost savings of GBP20 million, increased from the GBP10 million it was targeting in March, which will result in restructuring costs for the full year increased by around GBP5 million to GBP15 million. It now expects capital expenditure of GBP10 million, lower than the GBP15 million it had previous guided.
Trinity Mirror proposed an interim dividend of 2 pence per share, in the previous year it did not pay an interim dividend. At its full year results in March it paid its first full year dividend to shareholders since 2008.
"I remain confident that our strategy will deliver sustainable growth in revenue and profit over the medium term despite the difficult print advertising market conditions. The actions we are taking in support of both our print and digital products provide the board with confidence that profits for 2015 will be in line with expectations," said Chief Executive Officer Simon Fox in a statement Monday.
Shares in Trinity Mirror were up 7.0% at 142.25 pence Monday morning, shortly after market open.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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