Media company Daily Mail and General Trust plc or DMGT (DMGT.L) Tuesday issued a trading update for the eleven month period ended August 2010, stating it saw strong growth in adjusted margin and profit, helped by positive revenue trends and effective cost control. The company expects outcome for the fiscal year ending on October 3 to be at least in line with City consensus estimate.
Current City expectations for fiscal 2010 are profit before tax of GBP 238 million and earnings per share of 46.1 pence.
Separately, the company said that Peter Williams, who has been with the company since 1982, intends to retire as Finance Director in March 2011. Williams held the position since 1991.
The company also stated that Stephen Daintith, currently serving as Chief Operating Officer and Chief Financial Officer of Dow Jones based in New York, will succeed Williams.
For the 11-month period under review, the company said its underlying revenue, which is on a like-for-like basis, was up 2% from last year. On a reported basis, underlying revenue declined 7%. The company also stated that trading remained robust, with underlying growth from both Business to Business (B2B) and consumer media businesses.
Based on divisions, revenue was up 11% for Risk Management Solutions, reflecting continued growth from both its core modelling business and newer initiatives. At dmg information, reported revenues grew 1% and underlying revenue rose 5%, with an 11% increase from the property information companies.
Further, the company said that it saw a total 9% growth for its operations in the education, financial and energy information markets. The overall increase from the company's non-property companies, including Sanborn Map Company, was 2%.
The dmg events division posted a 9% decline in underlying revenues. Reported revenues also were down 38%, as expected, due to the impact of prior year disposals.
Further, the group said that its consumer media operations recorded a 1% rise in underlying revenues for the period. However, reported revenues decreased 8%, reflecting various portfolio changes.
Among the company's consumer media operations, Associated Newspapers posted underlying revenue growth of 3% while reported revenue dropped 4%. Underlying circulation revenues were down 2% even though the Daily Mail and The Mail on Sunday newspapers improved their market share in recent months. Total underlying advertising revenues rose 6%.
Northcliffe Media's revenues were 6% lower, with advertising revenues dropping 7% and circulation revenues declining 6%. A&N International Media's posted a revenue decline of 25% for the period, with underlying revenues decreasing 9%.
For fiscal 2010, the company still expects adjusted profit growth for the B2B operations, driven by solid subscription revenues and good cost control. Higher national advertising revenues, together with A&N Media's focus on cost control, are expected to lead to significantly higher adjusted profit for the consumer media operations for the full year.
The company also estimates to incur exceptional gains of around GBP 60 million in fiscal 2010, offset in part by operating costs of about GBP 40 million.
DMGT.L is trading at 526.50 pence on the LSE, up 1.50 pence or 0.29%, on a volume of 109,620 shares.
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