Rothermere: ‘good result’ in tough conditions
The Daily Mail’s parent company has proved it is possible to make money distributing a free daily newspaper in the UK.
Metro, which is circulated in big cities across the country, has gone into profit for the first time since its launch in March 1999. Distribution in 2003 was up 3 per cent to 861,000 and sales of display advertising were up 28 per cent, according to the Daily Mail and General Trust’s annual report.
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Overall turnover at the group was down 1 per cent in 2003 and totalled £1,933m. Operating profit was down 2 per cent to £237.5m but profit before tax was up 2 per cent to £185.5m.
The regional newspaper division, Northcliffe, which includes 20 dailies and 24 paid-for weeklies, enjoyed nearly twice the profit margin of the nationals papers. Turnover increased from £472m to £484m and operating profit increased 4 per cent to £94m. The operating profit margin increased from 19 per cent to 19.7 per cent.
Circulation at the company’s regional dailies dropped by around 3 per cent but income was boosted by price rises.
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In the Associated Newspapers division, which includes Metro, the Evening Standard and the Mail titles, turnover fell from £828m in 2002 to £820m.
Operating profit was down from £80m to £70m, a margin of 9 per cent. Circulations of the Daily Mail (2,443,000) and The Mail on Sunday (2,367,000) were slightly up, by 6,000 and 7,000 respectively. But the Standard fell 1.3 per cent to 412,000.
The Euromoney magazines division was hit by the weak dollar and the war in Iraq: turnover fell to £159m (from £180m) and operating profit was down 18 per cent to £23m.
Teletext performed well, helped by expansion into Freeview television and mobile phone services.
Revenue was down 2 per cent but profit up 5 per cent.
Company chairman Viscount Rothermere said of the 2003 performance: “This is a good result given the tough trading conditions that many of our businesses faced, as well as the effects of the Iraq war and SARS. Particularly pleasing were the steady rise in the profits of Northcliffe and the higher contributions from some of our newer businesses.
Newspapers remain at the heart of DMGT and our first priority is always to grow Associated and Northcliffe.”
By Dominic Ponsford
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