INM: 'No improvement in advertising conditions this year'

Independent News and Media has said it expects its 2009 profits to be down about 10 per cent on last year – and is not predicting any improvement in advertising revenues this year.

The group issued a trading update this morning after its share price fell more than 45 per cent last week to an all-time low of €0.19.

The Dublin-based publisher said it considered the sharp decline in its market value to be “unwarranted” given that it “continues to be a profitable and cash-generative business”.

INM said it had identified a number of potential loss-making assets for disposal within the next 12 months, in a bid to bring down its debt levels.

It did not name them in its release this morning, but said they would be “assets whose disposal will not impact on the existing operating divisions”.

A report in London business newspaper City AM this morning quoted a senior INM source, who said Anthony O’Reilly could consider selling the Independent and the Independent on Sunday.

“Yes. If there as a buyer then yes, it’s a possibility,” the source said. “Who is going to buy the Independent? It’s a loss-making paper.”

Independent News and Media is due to publish its end-of-year results on 31 March.

Total group revenue in 2008, which is still subject to a full audit, is expected to exceed €1.4bn euros (£1.3bn) – down about three per cent on 2007. INM said more than a third of this came from areas other than advertising.

“While INM, like all other companies, is currently operating in very challenging economic and advertising conditions, the group is pleased to confirm that its global and diverse operations are continuing to demonstrate considerable resilience,” the company said.

The Independent publisher said group operating profit over the coming year is expected to be in the region of €240m to €270m (£225m to £255m), down about 10 per cent on 2008.

INM said today that it was still operating within its banking covenants and working to reduce its debt.

The company’s directors have also agreed to waive their bonuses this year and take a 10 per cent salary cut. Shareholders will not receive a dividend this year.

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