PA Group has said ‘substantial investment’in multimedia almost halved the company’s profits last year.
The news provider was expected to warn shareholders at its annual general meeting on Friday that wider uncertainty in the newspaper industry and a tightening of sports rights continue to present a challenge for the business.
The group’s annual report reveals PA’s total group revenue increased by six per cent in 2007, up from £90m to £95.4m. Around two thirds of this money – £60.9m – was made in the UK.
But overall, PA Group operating profits in 2007 fell by 46 per cent from £2.6m to £1.4m. Once tax and one-off items are taken into account, PA Group posts a loss last year of £737,000.
‘We have built another layer of content – video – to the traditional wire service of text, photos and graphics,’PA Group chief executive Paul Potts said.
‘This has meant developing considerable multimedia production as well as video-gathering capabilities. Inevitably, the scale of this commitment is reflected in the lower operating profits.”