DGMT: Ad rise tempered by five month revenue falls

Revenue from display advertising at Daily Mail & General Trust‘s national newspaper division rose 13 per cent year-on-year in the last three months, the company reported today.

Marking a change in fortune for the publisher of the Daily Mail and Mail on Sunday, which like all other newspaper businesses has reported drastic falls in the past 18 months, in the last quarter overall ad revenue at Associated Newspapers rose eight per cent year-on-year.

Publishing a trading update this morning, parent company DMGT reported how ad revenue at AN Digital had also risen three per cent in the last three months.

Underlying circulation revenue fell four per cent but both the Daily Mail and The Mail on Sunday increased their market share.

DMGT noted that this compared with a period in 2009 when it still wholly-owned the loss-making London Evening Standard and before its closure of the loss-making London Lite freesheet.

The recent uplift in ad revenue was not sufficient to prevent DMGT reporting that in the five months to the end of February revenue from its local and national newspaper operations fell 11 per cent year-on-year – or six per cent on an underlying basis.

Ahead of reporting full half-year results on 4 April, DMGT reported that overall revenue was 13 per cent lower year-on-year in the five months to the end of February – but only down five per cent on an underlying basis.

The company reported: “The generally positive trends in our international B2B operations have remained broadly unchanged and the trends in our UK consumer media businesses have continued to improve.

“Trading has continued to be ahead of our expectations, but we remain cautious about the second half of the year, particularly in the light of political uncertainty in the UK after the general election.”

Northcliffe Media, the regional newspaper business of DMGT which publishes in excess of 100 titles across the UK, recorded a drop in ad revenue of ten per cent year-on-year in the five months to the end of February, with underlying revenue down nine per cent.

DMGT noted that ad revenues had continued to improve at Northcliffe in recent months but since were still below the level of the corresponding period last year.

The company said: “Results for the first half of the year are expected to show a significant increase on last year’s first half year largely due to the improvement in the profitability of the consumer businesses.

“B2B profit growth will be partially offset, as expected, by a lower contribution from DMG World Media, reflecting the divestments of businesses last year as part of our strategy to focus the portfolio on the B2B sector, and the absence of one large biennial event.”

Revenues from the group’s B2B operations for the five-month period were 17 per cent lower than last year, it reported, with an underlying fall of four per cent.

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