United Business Media expects FY08 performance in line with guidance; to cut 350 jobs - Update

united UBML 121208

United Business Media Limited (UBM.L), the owner of PR Newswire, Friday said it expects to deliver full year 2008 performance consistent with its guidance given in the Interim Management Statement on November 18. That forecast expected earnings per share and revenues in 2008 in line with market consensus. Additionally, in an effort to cut costs to tackle a tough 2009, the company said it has decided to reduce global headcount for the second half of 2008 by about 350 people.

Issuing its trading update for the second half of 2008, the UK-based company noted that its performance in November was in line with expectations. Strengthening of the US dollar against Sterling and the continuing strong performance of UBM's major events, data and workflow products helped the company achieve its highest monthly operating profit of the last six years. However, the company said that certain print advertising and secondary events remain weaker.

PR Newswire's multimedia business and its international news distribution businesses in Europe, China and Latin America performed strongly, although US message volumes in November were down across the market, partly due to the US presidential election.

On December 8, the company, which publishes Information Week, revealed the reorganization of Commonwealth Business Media into two separate market-focused businesses, UBM Aviation and UBM Global Trade. The new market focused entities are expected to be effective January, 2009.

UBM Global Trade will focus on serving professional communities engaged in commercial sea, rail and road transportation and logistics worldwide. UBM Aviation will focus on serving the global commercial aviation industry, principally with its industry-standard online subscription-based information products and services that generate more than 85% of the business's pro forma revenues.

Considering the delayering, UBM said Friday that its global headcount for the second half of 2008 is expected to be reduced by nearly 350 people once the relevant consultation processes are concluded.

UBM made three acquisitions in the last one month; China-based companies Sanguine and XPRN, as well as Game Developer Europe. The total initial consideration for these acquisitions was GBP 10.7 million. The company expects that further opportunities will arise in 2009 to make reasonably priced acquisitions.

According to David Levin, chief executive officer of United Business Media Limited, "We have anticipated and have planned for a difficult global economic background in 2009. We have retained our strong balance sheet, improved our liquidity position, continued to reduce our operational costs and have focused on continued improvements in our operational performance."

The company is scheduled to announce preliminary 2008 results on March 3, 2009.

UBM.L is currently trading on the LSE at 459 pence, down 9 pence or 1.92%, on 1.01 million shares. For the past year, the stock trended in the range of $360.25-$651.00.

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