10th Nov 2014 12:03
LONDON (Alliance News) - Trinity Mirror PLC said Monday it expects its profit for the full year to meet its expectations, and to reinstate dividend payments for the year, as it saw revenue decline 5% during the 17 weeks to October 26.
The company saw overall revenues drop 5% for the period, compared to a 2% decline in its first half.
In its Publishing business, the company said that whilst digital grew 44%, this was more than offset by a 7% decline in print. Within Publishing, circulation revenue across digital and print fell 3% as volume declines were partly offset by a rise in cover price. Print advertising revenue fell 12%, faster than the 9% decline it saw in the first half, due to weaker national display advertising spend, particularly from supermarkets.
In the Printing business, revenue fell 6% during the period, due to falling volumes hitting newsprint revenues, combined with lower newsprint prices.
Trinity Mirror expects to reinstate dividends this year, with a final dividend of 3 pence per share.
The company said it has settled a number of claims in regards to the phone-hacking scandal during the period, and its subsidiary MGN Ltd has admitted liability to a number of individuals over the interception of their voice-mails. It said that these steps "were within those contemplated at the time of its interim results, and thus it has made no changes to its provisions to deal with the claims. At that time, Trinity Mirror said it had set aside GBP4 million for phone-hacking costs.
The company said it had continued to see month-on-month volatility in print revenue, particularly in national advertising revenues. It expects this to continue for the remainder of the year.
Trinity Mirror said that due to "phasing", its capital expenditure is expected to be lower than its previous guidance of GBP15 million. Restructuring charges in relation to its cost-reduction measures are expected to be marginally higher than its previously guided GBP12 million, it said.
"Despite the recent deterioration in national press advertising trends, I remain confident that our strategic initiatives will ultimately deliver sustainable growth in revenues and profits," said Chief Executive Simon Fox in a statement.
Liberum reiterated its Buy rating for the stock, citing an attractive valuation, a strong management team, and the reiterated guidance for a 3 pence dividend. Numis also reiterated its Buy rating, saying Monday's statement will result in a change to its headline profit estimates, as the slightly weaker than hoped print advertising performance is offset by increased structural cost saving.
"Trinity shares remain very good value at current levels," Numis said. "We reiterate our Buy and blended multiples based target of 294p."
Shares in Trinity Mirror are trading down 3.6% at 160.06 pence Monday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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