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2002 interim results

2002 interim results. 31 July 2002. TRINITY MIRROR plc. TRINITY MIRROR plc. 2002 Interim Results SLIDE 1. Presentation overview. Sir Victor Blank, Chairman. Philip Graf, Group Chief Executive. Joe Sinyor, Chief Executive, Newspapers. Financial highlights.

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2002 interim results

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  1. 2002interim results 31 July 2002 TRINITY MIRROR plc.

  2. TRINITY MIRROR plc. 2002 Interim Results SLIDE 1 Presentation overview Sir Victor Blank, Chairman Philip Graf, Group Chief Executive Joe Sinyor, Chief Executive, Newspapers

  3. Financial highlights • Turnover down 3.6% to £554.8m* (2001: £575.6m)* • Pre exceptional items • Operating profit down 4.6% to £95.9m* (2001: £100.5m)* • Profit before tax decreased 2.7% to £78.4m (2001: £80.6m) • Earnings per share 18.4p (2001:19.4p) • Dividend per share 5.3p – same as 2001 * like-for-like-adjusted to exclude the results of Post Publication Ltd and Ethnic Media Group Ltd which were disposed of in June 2002

  4. Profit improvements • Cost saving initiatives – target gross £32m in 2002 • Continue to deliver on plan • £14.6m realised H1 2002 • Incremental investment in Group titles – £25m in 2002 • £8.7m invested in H1 2002

  5. Consolidated net assets 30th June 30th December * 1st July * £m 2002 2001 2001 Fixed assetsIntangible 1,849.8 1,866.9 2,017.7 Other 398.1 407.6 408.42,247.92,274.5 2,426.1Net debt (703.9) (735.0) (771.8)Other net liabilities (136.1) (168.6) (142.5) Net assets (excluding pension assets & liabilities) 1,407.9 1,370.9 1,511.8Pension assets 16.7 28.8 57.0Pension liabilities (100.8) (54.7) (13.0) Net assets 1,323.8 1,345.0 1,555.8 * restated for adoption of FRS 17

  6. Strong cash flow26 weeks to 30th June 2002 £m 2002 2001 Net cash flow from operations 101.0 88.9 Net cash flow before acquisitions and disposals 49.8 38.3 Net cash inflow / (outflow) before financing 29.5 (4.9) Reduction / (increase) in net debt 31.1 (3.6) Profit interest cover (pre exceptionals) 4.5 times 3.9 times

  7. TRINITY MIRROR plc. operations review

  8. TRINITY MIRROR plc. 2002 Interim Results SLIDE 7 Regional Newspapers UK and Scottish National Newspapers Sports Newspapers

  9. TRINITY MIRROR plc. 2002 Interim Results SLIDE 8 Regional Newspapers Regional Newspapers UK and Scottish National Newspapers Sports Newspapers

  10. TRINITY MIRROR plc. 2002 Interim Results SLIDE 9 Trinity Mirror plc profit £95.9m *26 weeks to 30 June 2002 turnover £554.8m *26 weeks to 30 June 2002 Other£42.6m Other£6.8m NationalNewspapers£26.7m NationalNewspapers£249.7m RegionalNewspapers£262.5m RegionalNewspapers£62.4m * like-for-like

  11. TRINITY MIRROR plc. 2002 Interim Results SLIDE 10 Biggest regional newspaper business in UK • 240 titles • 13 operating companies • 4 regions in development

  12. TRINITY MIRROR plc.2002 Interim Results SLIDE 11 Strategic directionfour cornerstones of the regional strategy Driving performance Leveraging the benefits of scale Striving forexcellence Maintaining ambition for growth

  13. “Biggest to Best” projects completed • Performance management system • Standardised advertising classification • Design of more efficient editorial, pre-press and advertising functions • Development of plans to regionalise in the North West and North East

  14. “Biggest to Best” investments • £1m relaunch of the Birmingham Evening Mail • £1m in brand and readership research • £3.3m in central support and one-off costs • £90m investment in new presses approvedand underway

  15. TRINITY MIRROR plc.2002 Interim Results SLIDE 14 Regional newspapersCore(£m) Margin: up from 24.4% to 24.6% -2.0% -1.1% 01 02 01 02 Revenue * Profit * * like-for-like

  16. Regional division summary • “Biggest to best” change well underway • Active cost management • Strong performance outside London and South East and the Midlands • Investing for future

  17. TRINITY MIRROR plc. 2002 Interim Results SLIDE 16 Regional Newspapers UK National Newspapers Sports Newspapers UK National Newspapers

  18. product pricing brand promotion TRINITY MIRROR plc.2002 Interim Results SLIDE 17 Mirror integratedmarketing strategy new sections new columnists change masthead ‘think again’ branding campaign extended coverprice reduction targeted promotions

  19. TRINITY MIRROR plc.2002 Interim Results SLIDE 18

  20. TRINITY MIRROR plc.2002 Interim Results SLIDE 19

  21. TRINITY MIRROR plc. 2002 Interim Results SLIDE 20 The Mirror's rebirth from trivial red-top to serious newspaper following the events of September 11 must go down as one of the most successful rebrands of recent times. The paper has since swept the board at press award ceremonies and seized the initiative from the previously rampant Sun Marketing Magazine25th July 2002

  22. TRINITY MIRROR plc.2002 Interim Results SLIDE 21 Scope to improve loyalty 100% = total reader pool 14,600 19,200 occasional readers loyal readers average issue readership 5,763 9,483

  23. TRINITY MIRROR plc.2002 Interim Results SLIDE 22 Increasing awarenessBase : all tabloid readers (roll 13)(%) Start of price-cutting The Mirror Think Again The Sun, We love it

  24. TRINITY MIRROR plc.2002 Interim Results SLIDE 23 Brand becoming clearerBase : all tabloid / mid-market readers Difference Image 20 Has a strong personality Tells me what’s really going on A trendsetter A serious newspaper Reminds you that things in life aren’t so bad Has a good sense of what’s right and wrong Makes you feel part of what’s going on Helps you understand how news affects you Is thought provoking Clever Responsible Firm Thorough A bit simple Childish 5 5 5 4 6 5 4 4 4 5 5 5 5 - 5 - 7 25 17 22 13 18 8 12 Needs 16 22 18 23 18 22 17 21 15 19 Personality 14 19 16 21 14 19 Pre 12 17 Post (April-June) 25 20 23 16

  25. TRINITY MIRROR plc.2002 Interim Results SLIDE 24 UK national newspapers(£m) Margin: down from 15.6% to 9.3% -5.1% -43.6% 01 02 01 02 Revenue Profit * includes £6.5m incremental investment

  26. TRINITY MIRROR plc. 2002 Interim Results SLIDE 25 Regional Newspapers Scottish National Newspapers Sports Newspapers Scottish National Newspapers

  27. TRINITY MIRROR plc.2002 Interim Results SLIDE 26

  28. TRINITY MIRROR plc.2002 Interim Results SLIDE 27 Scottish national newspapers(£m) Margin: down from 18.8% to 15.7% -4.9% -20.4% 01 02 01 02 Revenue Profit

  29. TRINITY MIRROR plc. 2002 Interim Results SLIDE 28 Regional Newspapers UK and Scottish National Newspapers Sports Newspapers Sports Newspapers

  30. TRINITY MIRROR plc. 2002 Interim Results SLIDE 29 Sports business

  31. TRINITY MIRROR plc.2002 Interim Results SLIDE 30 Sports newspapers(£m) Margin: up from 21.1% to 32.0% +18.7% +80.0% 01 02 01 02 Revenue Profit

  32. Summary • Excellent start on “From Biggest to Best” • Good cost control throughout • UK and Scottish Nationals strategies underway • Investing in businesses for long term

  33. Outlook • Advertising environment remains uncertain • National advertising continues June trend • Regional advertising mixed

  34. 2002interim results TRINITY MIRROR plc.

  35. 2002interim results appendices financial performance interim 2002 TRINITY MIRROR plc.

  36. Financial summary26 weeks to 30th June 2002 actual £m 2002 2001 * Group turnover 559.6 581.4 Group operating profit 89.9 93.5 Pre exceptional items 96.3 101.1Exceptional items (6.4) (7.6) Share of results of associates 0.8 0.1 Total operating profit 97.7 93.6 Profit before taxation 72.1 73.0 Operating activities 104.1 101.2Net interest payable (21.4) (25.9)Other finance income 2.7 5.3Exceptional items (6.3) (7.6) Earnings per share (p) Before digital media investment 19.5p 23.0p Digital media activities (1.1)p (3.6)p Underlying EPS 18.4p 19.4p Exceptional items (1.5)p (1.8)p Basic earnings per share 16.9p 17.6p * restated for FRS 17

  37. Financial summary26 weeks to 30th June 2002 pre FRS 17 £m 2002 2001 Group turnover 559.6 581.4 Group operating profit 96.9 99.2 Pre exceptional items 103.3 106.8Exceptional items (6.4) (7.6) Share of results of associates 0.8 0.1 Total operating profit 97.7 99.3 Profit before taxation 76.4 73.4 Operating activities 104.1 106.9Net interest payable (21.4) (25.9)Exceptional items (6.3) (7.6) Earnings per share (p) Before digital media investment 20.5p 23.1p Digital media activities (1.1)p (3.6)p Underlying EPS 19.4p 19.5p Exceptional items (1.5)p (1.8)p Basic earnings per share 17.9p 17.7p

  38. Analysis of revenue by activity26 weeks to 30th June 2002 like-for-like actual £m 2002 2001 change % 2002 2001 change % Regional newspapers * 267.3 273.4 (2.2) 262.5 267.6 (1.9) National newspapers 249.7 262.9 (5.0) 249.7 262.9 (5.0) Sports newspapers 19.7 16.6 18.7 19.7 16.6 18.7 Magazines and exhibitions 18.8 19.6 (4.1) 18.8 19.6 (4.1) Voice media 3.8 8.3 (54.2) 3.8 8.3 (54.2) Digital media 0.3 0.6 (50.0) 0.3 0.6 (50.0) Total turnover 559.6 581.4 (3.7) 554.8 575.6 (3.6) * includes Metro titles £4.4m (2001: £4.1m)

  39. Analysis of revenue by type26 weeks to 30th June 2002 like-for-like actual £m 2002 2001 change % 2002 2001 change % Circulation 192.0 194.6 (1.3) 191.1 193.6 (1.3) Advertising 316.6 330.6 (4.2) 312.9 326.0 (4.0) Other revenues 51.0 56.2 (9.3) 50.8 56.0 (9.3) Total turnover 559.6 581.4 (3.7) 554.8 575.6 (3.6)

  40. Analysis of revenue by activity and type26 weeks to 30th June 2002 Nationals Voice Digital %£m Regionals UK Scotland Sports Mags Media Media total of total Circulation 41.2 106.9 27.7 13.0 2.3 - - 191.1 34.4 Advertising 202.9 72.0 25.1 5.4 7.5 - - 312.9 56.4 Other 18.4 16.1 1.9 1.3 9.0 3.8 0.3 50.8 9.2 Total turnover 262.5 195.0 54.7 19.7 18.8 3.8 0.3 554.8 % of total 47.3% 35.1% 9.9% 3.6% 3.4% 0.7% like-for-like

  41. Analysis of revenueregional newspapers26 weeks to 30th June 2002 £m 2002 2001 change % Circulation 41.2 41.3 (0.2) Advertising 202.9 207.5 (2.2) Display 58.7 59.5 (1.3) Classified 139.8 144.0 (2.9) Metro titles 4.4 4.0 10.0 Other 18.4 18.8 (2.1) 262.5 267.6 (1.9) like-for-like

  42. Regional newspapersAdvertising growth26 weeks to 30th June 2002 % movement Revenue £m 58.7 62.4 23.0 20.6 33.8 198.5 Revenue % (1.5) (5.4) (3.4) (3.1) 2.7 (2.5) Volumes % (4.7) (14.1) (2.4) (0.2) (1.2) (3.7) Yield % 3.2 8.7 (1.0) (2.9) 3.9 1.2 like-for-like excludes Metro titles

  43. Analysis of revenueUK national newspapers26 weeks to 30th June 2002 £m 2002 2001 change % Circulation 106.9 109.2 (2.1) Advertising 72.0 80.2 (10.2) Display 40.1 47.5 (15.6) Classified 11.3 11.7 (3.4) Magazines/supplements/inserts/editions 20.6 21.0 (1.9) Other 16.1 16.0 0.6 195.0205.4 (5.1)

  44. UK national newspapersadvertising volumes - daily market26 weeks to 30th June 2002 January – June 2002 (year on year growth %)

  45. UK national newspapersadvertising volumes - Sunday market26 weeks to 30th June 2002 January – June 2002 (year on year growth %)

  46. UK national newspapersadvertising market share (volumes)26 weeks to 30th June 2002 Dailies Sundays

  47. UK national newspapersdisplay advertising revenues26 weeks to 30th June 2002 (year on year growth %) Revenue £m 14.5 4.9 3.0 1.8 3.3 2.0 1.5 2.3 2.7 4.1 40.1

  48. Analysis of revenuesScottish national newspapers26 weeks to 30th June 2002 £m 2002 2001 change % Circulation 27.7 29.6 (6.4) Advertising 25.1 25.8 (2.3) Other 1.9 2.1 (9.5) 54.757.5 (4.9)

  49. Group operating profit by activity26 weeks to 30th June 2002 (post FRS 17) like-for-like actual £m 2002 2001 change % 2002 2001 change % Regional newspapers 62.8 62.4 0.6 62.4 61.8 1.0 Established titles 63.9 64.8 (1.4) 63.5 64.2 (1.1) Metros (1.1) (2.4) 54.2 (1.1) (2.4) 54.2 National newspapers 26.7 42.9 (37.8) 26.7 42.9 (37.8) Sports newspapers 6.3 3.5 80.0 6.3 3.5 80.0 Magazines and exhibitions 4.0 4.6 (13.0) 4.0 4.6 (13.0) Voice media 0.9 2.4 (62.5) 0.9 2.4 (62.5) Digital media (4.4) (14.7) 70.1 (4.4) (14.7) 70.1 Group operating profit * 96.3 101.1 (4.7) 95.9 100.5 (4.6) * excludes exceptional items

  50. Group operating profit by activity26 weeks to 30th June 2002 (post FRS 17) 2001 2002 excludes digital media and exceptional items like-for-like

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