3rd Aug 2009 08:09
3 August 2009
Sport Media Group plc
("Sport Media" or "the Company")
Trading Update and Sale of Front Magazine
The Board of Sport Media Group Plc, today issued the following trading update:
"As we approach the end of the second six months trading of our 17 month financial year to 31 December 2009, we are pleased to announce that, following the successful completion of re-arranged bank facilities, and the provision of a loan from David Sullivan and Gold Group International, the Group has seen a significant improvement in trading.
In particular, the recovery in circulation of the newspaper titles has been very encouraging. In recent weeks we have achieved average daily sales (Monday-Friday) of approaching 85,000 copies, which is 18% higher than the nadir in March, and more than 6% up year-on-year. The involvement of our Honorary Publisher, David Sullivan, continues to have a positive impact, and we are grateful for his continued oversight.
Saturday circulations have also improved significantly, with most recent Saturday sales of just over 55,000 (from a low of c. 45,000). Average Sunday Sport figures have also increased over the same period by 7.5% to c. 76,500 (four-week averages). These increases are extremely encouraging as we move into the summer holiday period, and the Group is confident that this growth, combined with fewer people travelling abroad, will result in circulation continuing to perform well over this traditionally weaker period.
Advertising revenues are stable, and the digital division, which uses the newspaper for marketing, has also seen a benefit from the increase in circulation. Given the cost savings that have been achieved, and the new print contract that has reduced our production costs since May, it is pleasing to report that profitability, and cash generation, is currently running ahead of our revised budgets.
Whilst the operating performance of the Group has been positive the Board is cautious about the trading status of the smallest of the Newspaper's three distributors, Dawson News Limited. As at the 31 July 2009 the Group had a financial exposure of c. £160,000 with Dawsons News.
The Company has also today announced that the business and assets of Flip Media Limited, the publisher of Front Magazine, has been sold to independent start up Kane Limited from current owners Sport Media Group for a consideration of £87,500. In the year to 31 July 2008 Flip Media reported Net Assets of £6,744 and a net loss pre consultancy fees, management income and tax, of £115,102.
The Board also today announces that it expects to publish the Company's Second interim report, for the six months to 31st July, at the beginning of October.
For further information, please contact:
Sport Media Group plc
Andrew Fickling, Chief Executive Officer
Tel: +44 (0) 161 236 4466
Daniel Stewart & Company plc
Simon Leathers / Oliver Rigby
Tel: +44 (0) 20 7776 6550
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