British media company sees profits surge

UK's Independent News & Media is confident of seeing off increased competition to its national newspapers based in London and Dublin.

The company, which publishes The Independent from London and the Irish Independent from Dublin, reported a 12 per cent rise yesterday in operating profit, before exceptional items, to £141m for the six months to the end of June.

IN&M said all regions, except Northern Ireland, where there had been a dip in the advertising market, were showing healthy growth. As well as the UK and Ireland, the group has interests in South Africa, Australia, New Zealand and India.

Ivan Fallon, the chief executive of IN&M's operations in the UK, said he "welcomed" more innovation in the newspaper market. This week, The Guardian was relaunched in a smaller "Berliner" format, in effect halfway between tabloid and broadsheet size. In the Republic of Ireland, Daily Mail & General Trust is due to start a version of its Metro free newspaper for the Dublin market.

IN&M reported that advertising revenues for The Independent were up 18.5 per cent for the half-year. Mr Fallon said the same rate of growth had been maintained so far in the second half.

"The Independent is in better shape than it has been for years, editorially and in terms of sales and advertising," he said. "We've had two years to prepare for The Guardian [relaunch]. I'm pretty confident that we can hold our own."

The Guardian move was a reaction to a change in size at the quality end of the UK newspaper market that was led by The Independent in autumn 2003, when it took a tabloid-sized "compact" format. Mr Fallon said The Independent and its sister paper, The Independent on Sunday, would reduce losses this year from the £10m deficit last year and, depending on the state of the advertising market, the newspapers could break even in the second half of 2006.

Turning to Metro in Dublin, Mr Fallon said it would only increase the losses suffered by its owners, DMGT, in the Irish market.

"We obviously have plans to counter it [Metro] very robustly. That will obviously cost us money but it will cost them even more," he said.

Group turnover was 9.2 per cent up for the first half. Sir Anthony O'Reilly, the chief executive of IN&M, said the group should deliver double-digit earnings growth for the full year.

The company has just completed the acquisition of a 26 per cent stake in JPPL, the publisher of Dainik Jagran, a Hindi language newspaper with a daily readership of 21.1 million - the world's highest.

Mr Fallon said the company planned further investment in the country. "We see India as an exciting new market," he said.


* Independent News & Media are owners of APN, the Australasian publishing, broadcasting and outdoor advertising group who publish The New Zealand Herald.


- INDEPENDENT