Interim Results-Part 1

Trinity Mirror PLC 14 September 2000 PART 1 Trinity Mirror plc Interim Results for the 26 week period ended 2 July 2000 Trinity Mirror plc, the UK's largest newspaper publisher, announces the Group's unaudited interim results for the 26 weeks ended 2 July 2000. Financial highlights (pro forma basis) 2000 1999 % change Turnover (continuing operations) £559.9m £521.4m +7.4% Group operating profit - before developing activities and exceptional items £132.4m £118.0m +12.2% - loss from investment in developing activities £(14.9)m £(1.1)m Profit before tax - before developing activities and exceptional items £104.5m £91.1m +14.7% Earnings per share - before developing activities and exceptional items 25.8p 23.9p +7.9% - underlying (before exceptional items) 22.0p 23.6p -6.8% Dividend 5.3p 4.8p +10.4% 'Developing activities' include digital media and Metro operations. All other businesses are categorised as 'established activities'. Operational highlights (pro forma basis) * Operating margin of established activities increased from 22.4% to 23.8% - the newspaper publishing divisions performed strongly and achieved good revenue and profit growth * Regional newspapers grew revenue and operating profits by 6.1% and 10% to £245.3m and £66.8m respectively * National newspapers, including the Daily Record and Sunday Mail, overall achieved operating profit of £55.4m (up 5.7%) and revenues of £268.9m (increase of 6.2%). Three UK titles, The Mirror, Sunday Mirror and Sunday People, achieved 7.4% revenue growth (to £210.5m) and operating profit of £42.9m (increase of 8.3%) * Net cost of £14.9m from investment in developing activities - digital media £12.4m, Metro £2.5m. Significant progress has been made in the implementation of the digital media strategy and development of the technology platform * 'ic' network today has 610,000 subscribers, 540,000 active. Monthly page impressions for Group sites increased from 36m in January to 50m in June - and reached over 70m in August Sir Victor Blank, Chairman of Trinity Mirror plc, commented: 'It has been a busy period for the Group, during which we have made progress in realising the two most important business goals of the Group, being the successful integration of the two former businesses and the implementation of our digital media strategy. We have also made good operational progress, achieving a solid financial performance during the first six months of 2000. To accelerate the pace of the integration and, in particular, to exploit fully the inherent strengths of the assets of the business, we have today announced a number of senior management changes. These important changes will help us to move forward to realise fully the benefits that our assets potentially provide and achieve the Group's longer term vision and goals. We have a very exciting future and I believe we have put in place the foundations to take advantage of the significant opportunities available to us.' Enquiries: Trinity Mirror plc 020 7293 3000 Philip Graf, Chief Executive Margaret Ewing, Group Finance Director Finsbury 020 7251 3801 Rupert Younger James Leviton Interim Results for the 26 week period ended 2 July 2000 Introduction To provide shareholders with relevant and meaningful information, pro forma results for the 26 weeks to 27 June 1999, the previous interim period, and 53 weeks to 2 January 2000, the last financial year, have been prepared on the basis of assuming that the merger of Trinity plc and Mirror Group PLC became effective on 28 December 1998, being the first day of the relevant financial period. This approach facilitates meaningful comparisons between those periods and this current period, the 26 weeks to 2 July 2000. The commentary on pages 1 to 7 is based on the pro forma financial information for 1999. As required by The Listing Rules of the UK Listing Authority, results presented for the Group in a statutory format have been included for all periods concerned. To further aid interpretation of the Group's performance, its various operations have been individually classified as either an 'established activity' or 'developing activity'. A developing activity is a new business area in its investment and implementation phase and requiring further development before becoming a viable and sustainable business. All other operations of the Group are disclosed as 'established activities'. Financial summary Group revenues increased by 6.1% to £559.9m. Eliminating the revenues of Live TV in 1999, revenues of the Group (i.e. from continuing operations) increased by 7.4%. Operating profit from established activities, before exceptional items, has increased by 12.2% to £132.4m. Adjusting for discontinued operations in 1999, the increase is 10.1%. During the half year the Group has incurred net costs of £12.4m in developing its digital media business and £2.5m in launching and producing two Metro newspapers. Total operating profit for the period, after developing activities and exceptional charges of £7.7m (1999: £1.9m), is £109.7m (1999: £117.6m). Profit before tax and exceptional items was £89.6m for the half year, which is broadly similar to the comparable period, principally due to the investment in developing activities. Adjusted for the losses on these activities of £14.9m, profit before tax and exceptional items has increased by 14.7% to £104.5m. Earnings per share, before exceptional items, were 22.0p, down 6.8% from 23.6p. Excluding the losses from developing activities, pre-exceptional earnings per share have increased by 7.9%, from 23.9p to 25.8p. Regional newspapers The regional newspaper businesses produced operating profit growth of 10% to £66.8m on revenue growth of 6.1% (an increase from £231.1m to £245.3m), again enhancing margins. In the previous financial period, the operations in Birmingham and Liverpool had suffered difficult trading and other conditions. Management have successfully addressed the problems that had existed within these businesses and both operations, along with all other regions, have achieved good operating profit growth. All areas benefited from strong recruitment advertising revenues, up 21.3% overall to £54m, with total advertising revenues of the regional titles increasing to £177.1m (growth of 7.3%). National advertising achieved a growth rate of 5% (to £18.8m), along with property advertising which has performed strongly, helped by an increase in new homes activity. All other advertising categories produced reasonable growth other than motors, which has been affected by the consolidation of dealer franchises and the uncertainty over new car pricing. Although the circulation performance of the regional titles was affected during the second quarter of the year by the concentrated late Easter/May bank holiday period, there has been an improvement during the last two months. For the first time, an 'actively purchased' indicator (being copies consumers have decided to acquire and pay for) has been applied to the ABC's circulation figures. In this category, the Group's daily and Sunday titles have performed ahead of the industry. Revenues from non-printing sources increased by a pleasing 23.4% to £13.7m, continuing to broaden the revenue base of the titles. The growth in these other revenues has been derived mainly from exhibitions, sponsorships, leaflet distribution and audio text. Costs have been well controlled with savings in headcount achieved in non- revenue generating areas and good management of overheads. National newspapers Overall, the national newspaper operations, including the Daily Record and Sunday Mail grew revenues by 6.2%, from £253.2m to £268.9m, and operating profits by 5.7% (increasing from £52.4m to £55.4m). The UK national titles, being The Mirror, Sunday Mirror and Sunday People, achieved revenue growth of 7.4% to £210.5m, with circulation revenue up 5.9% to £113m (due primarily to cover price increases introduced during the latter half of 1999 and the beginning of the current year) and advertising revenues 5.5% ahead of last year at £78.4m. The advertising revenue growth is mainly attributable to the computers and internet, travel and finance categories. Other revenue streams have increased by 27.3% to £19.1m. The 7.4% increase in revenues of the UK nationals resulted in operating profit growth of 8.3% to £42.9m. The Scottish national operations achieved revenue growth of 2.1% to £58.4m in a very difficult market. However, operating profit was 2.3% less than last year (down £0.3m to £12.5m), attributable to the poor performance of the Scottish consumer magazine businesses. Following significant management actions to refocus the magazine businesses, the Scottish national operations have performed well during July and August and operating profit for the year to date is now approximately 4% ahead of last year. The Mirror has outperformed its direct competition in circulation and advertising results and produced significant revenue gains of 7.7% compared with last year. We continue to reinvest a significant element of the additional revenue in the title to improve the value of the paper to readers, an example of such investment being the award winning female glossy magazine 'M', issued on Tuesdays. The Sunday Mirror has produced strong advertising revenue growth with volumes up 8.6%. In Scotland, the Daily Record and Sunday Mail have outperformed their markets, despite being in fiercely competitive market places with continued outbreaks of cover price cutting by competitors. Advertising revenues have been maintained and profitability of both newspapers improved as a result of cover price increases and cost control. Sports The sports division has performed above expectation with a 45.8% growth in advertising revenues to £3.5m fuelled primarily by the increase in betting activity. Circulation revenue grew 24.2% to £11.8m. Cover price increases and the inclusion of Raceform revenues (acquired in October 1999) were the main contributors to the increase in circulation revenues of the sports division. Raceform contributed £2m overall to revenue during the period and £150,000 to operating profit of the sports division, which increased 57.7% to £4.1m. The sports division also includes three of the UK's leading sports portals and sites - racingpost.co.uk, sportinglife.com (in which Trinity Mirror has an effective 60% interest) and totalbet.com (in which the Group has an effective 30% interest). Growth on all three sites has been impressive during this year. In August, racingpost.co.uk registered 14.3m page impressions and had 79,000 registered subscribers. In October, the Racing Post intends to launch a new betting site, 'Smartbet'. This site will provide comparison tables enabling bettors to select the best prices and odds offered by an initial 6 bookmakers. Smartbet will also allow the bettors to strike their bet immediately on the site. sportinglife.com had over 450,000 unique host computers (equating to approximately 750,000 unique users) in August with 27.8m page impressions. totalbet.com had over 46,000 bets placed in August, with total betting revenue of more than £1m. This area of the business presents exciting opportunities for the future as the development of online betting continues. Magazines and exhibitions Although revenues and operating profits for this division increased by 11.1% and 4.3% respectively, this was primarily due to acquisitions during 1999. Difficulties in the IT sector, which have impacted consumer PC magazines, have negatively impacted the results of this division. This portfolio of titles and businesses is currently being restructured and refocused in order to create a sound base for future growth. Other activity In 1999, the Group's other activities included the operations of Live TV, which was closed in November. The final part of the Live TV operations, CASC, was closed on 31 August 2000, following the cancellation of one of its two external contracts (due to a change of ownership of the contracting party). During the period to 2 July 2000, Voice Media contributed most of the revenues and profits of the Group's other activities. Voice Media has improved both its revenue and profit performance significantly in 2000 due to new contracts, in particular, its premium phone line service provision to the daily morning TV show 'This Morning'. As a result, further investment has taken place in this business to increase telephone line capacity thereby improving the service and providing the ability for the company to gain additional contracts. Digital media Development of the Group's digital media strategy is still very much at the investment stage and, as previously announced in March, the Company is still anticipating investing £50m, including capital expenditure but gross of revenue, for the full year. This investment and forecast revenue are expected to give rise to an operating loss of approximately £37m for the full year and has given rise to net losses in the first half of the year of £12.4m. The digital media team continues working towards the goal of creating a unique UK portal, combining national content and regional sites on an integrated network, with all sites branded and marketed consistently. As a result of the Group's strategy to build a technical platform with superior functionality, on which to deliver the integrated network, a decision was taken in May to change the technology platform provider. The launch of the first new central portal ('icshowbiz') and migration of two regional sites on the new network is planned for October (the technology is currently in the testing phase). By the end of the year, two further central portals and ten major regional sites will be available on the integrated network. Despite a reduced marketing campaign compared to that originally planned, the traffic through the Group's web sites and subscribers to the ISP, ic24, during the period since March, have continued to increase, month on month, to a current level of 610,000 subscribers (of which approximately 540,000 are active) and over 70m page impressions per month (excluding the Belfast Telegraph site). This performance in page impressions and subscriber gains is in line with the Group's forecasts in March this year. Metro Trinity Mirror has played a leading role with Associated Newspapers (the national newspaper subsidiary of Daily Mail and General Trust plc) in the launch of the Metro free daily newspaper, which has become a newspaper phenomena. Net costs in the first half year were £2.5m following the launch of two regional editions in Birmingham in November 1999 and Newcastle in January 2000. This level of loss will continue in the second half of the year, reducing steadily thereafter. The agreement with Associated Newspapers provides Trinity Mirror with, amongst other benefits, the opportunity to share in the national advertising revenues. Associates PA Sporting Life has significantly increased its promotional expenditure (in respect of sportinglife.com and totalbet.com) during the current year, thereby creating considerable growth in traffic to its sites but further increasing its trading losses. The Group's share of losses of PA Sporting Life for the period were £0.8m (compared to £0.3m in 1999). Exceptionals The exceptional costs of £7.7m during the six month period were incurred as a result of merger related management changes (£0.7m) and the on-going re- organisation of the Group wide finance function (£7.0m). Cash flow and financing Interest charges are £5.6m (16.8%) less than last year, reflecting a prior period exceptional charge of £3.9m, strong cash flows, lower interest rates and the debt reduction of £110m in March 1999 (as a result of the disposals by the former Mirror Group of its investment in SMG and property at Holborn). Net debt, including finance leases, has reduced since 2 January 2000 by £24m to £754.5m at 2 July 2000, with gearing having fallen to 56.8% (2 January 2000 : 60.6%). With the proceeds from the disposal of Belfast Telegraph Newspapers (completed on 30 July), gearing has since fallen to a current level of 35%, with net debt of approximately £465m. Dividend The Board has declared an interim net dividend of 5.3p, which represents an increase of 10.4% on the interim dividend paid in 1999. The interim dividend will be paid on 27 October 2000 to shareholders on the register at 29 September 2000. Strategy The Group aims to grow both organically and through acquisition. The Group is investing to develop its existing titles and to broaden and deepen its offering to readers and advertisers by extending its brands and using its underlying assets, such as content and distribution networks, more effectively. The Group remains keen to participate in the continuing consolidation of the regional newspaper industry. However, it will only focus on assets that have a natural fit to its existing businesses and can deliver demonstrable value to shareholders. The Group is applying to the Secretary of State for Trade and Industry for clearance to acquire a number of titles currently owned by Regional Independent Media in the North West of England. The Group wishes to be in a position to be able to purchase these titles, if it so desires, should they become available. In November, the Government will issue its White Paper on communication. As the largest newspaper publisher in the UK, Trinity Mirror continues to attempt to persuade the Government to change competition legislation and regulation so that newspapers are subject only to general competition law and that the cross media regulations are changed to reflect the enormous technological changes which are affecting its marketplaces. People The management and staff throughout the Group have contributed strongly to a successful period. Individuals and businesses within the Group have won a record number of prestigious industry awards and all concerned are congratulated. The Group's ability to attract and retain talented people at all levels provides the firm foundation for its continuing success. The Directors are committed to the development of the Group's talent pool. Outlook The financial performance in the first six months has laid a good foundation for the remainder of the year. Trading conditions for most of the Group's businesses have remained sound and the Group is making good progress in the realisation of the committed £15m integration savings by the end of 2002. As expected, advertising growth for the national newspapers has slowed down during the early part of the second half of the year, against a very buoyant comparative in 1999. The regional operations have continued to experience strong advertising revenue growth. Costs will be incurred in the further development of the Group's digital media and Metro activities. The losses arising from the two Metro newspapers are expected to be similar to those incurred during the period to 2 July 2000. The Group's investment in digital media this year will be in line with the estimates announced in March. Although we are managing the effects of the current fuel crisis, the situation is so fluid that we cannot, today, make an assessment of the future financial implications, if any. Subject to this, the Board is confident of a satisfactory outturn for the full year. Consolidated Profit and Loss Account (Unaudited) Statutory Pro forma Notes 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to 2 July to 27 June to 2 Jan to 27 June to 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m Turnover 2 Continuing operations 559.9 168.0 593.8 521.4 1,052.4 Discontinued operations - - 2.0 6.5 10.6 __________________________________________________________________________ 559.9 168.0 595.8 527.9 1,063.0 __________________________________________________________________________ Operating profit Continuing operations 109.8 44.7 127.1 117.3 215.1 Discontinued operations - - (0.9) (2.3) (3.5) __________________________________________________________________________ Group operating profit 3 109.8 44.7 126.2 115.0 211.6 Share of results of associated undertakings 4 (0.1) (0.1) 0.3 2.6 3.0 __________________________________________________________________________ Total operating profit 109.7 44.6 126.5 117.6 214.6 (Loss)/profit on termination/sale of 5 - - (4.6) 30.1 23.9 operations (discontinued) Share of exceptional item of associated 5 - - 0.6 2.4 2.2 undertaking __________________________________________________________________________ Profit on ordinary activities before 109.7 44.6 122.5 150.1 240.7 finance costs Net interest payable (27.8) (2.0) (19.5) (33.4) (59.9) __________________________________________________________________________ Profit on ordinary activities before taxation ___________________________________________________________________________ Ordinary activities 89.6 42.6 115.3 90.0 168.1 before exceptional items Exceptional items (7.7) - (12.3) 26.7 12.7 ___________________________________________________________________________ 81.9 42.6 103.0 116.7 180.8 Taxation 6 (23.7) (13.2) (28.2) (22.9) (39.9) ___________________________________________________________________________ Profit on ordinary activities 58.2 29.4 74.8 93.8 140.9 after taxation Dividends 7 (14.9) (6.7) (46.4) (13.9) (46.2) ___________________________________________________________________________ Retained profit for the financial 43.3 22.7 28.4 79.9 94.7 period =========================================================================== Earnings per share 8 (pence) Established activities 25.8 21.1 46.9 23.9 47.8 Developing activities (3.8) - (1.8) (0.3) (1.7) ___________________________________________________________________________ Underlying earnings 22.0 21.1 45.1 23.6 46.1 per share Exceptional items (1.9) - (5.1) 8.9 2.7 ___________________________________________________________________________ Earnings per share - 20.1 21.1 40.0 32.5 48.8 basic Earnings per share - 20.0 20.8 39.7 32.4 48.5 diluted =========================================================================== Consolidated Balance Sheet (Unaudited) Notes 2 July 27 June 2 Jan 2000 1999 2000 £m £m £m Fixed assets Intangible assets 9 1,771.8 348.6 1,768.1 Tangible assets 419.1 129.7 433.2 Investments 7.0 4.6 11.3 _______________________________________________________________ 2,197.9 482.9 2,212.6 _______________________________________________________________ Current assets Stocks 14.7 2.5 13.7 Debtors 173.7 66.5 162.2 Cash at bank and in 29.9 6.9 50.2 hand _______________________________________________________________ 218.3 75.9 226.1 _______________________________________________________________ Creditors:amounts falling due within one year Bank loans, loan notes (222.6) (9.3) (123.9) and overdrafts Obligations under (8.0) (4.2) (7.5) finance leases Other creditors (245.4) (76.1) (266.3) _______________________________________________________________ (476.0) (89.6) (397.7) _______________________________________________________________ Net current (257.7) (13.7) (171.6) liabilities _______________________________________________________________ Total assets less 1,940.2 469.2 2,041.0 current liabilities Creditors: amounts falling due after more than one year Bank loans and loan (506.5) (4.0) (647.4) notes Obligations under (47.3) (46.6) (49.9) finance leases Other creditors (3.8) (2.2) (4.3) _______________________________________________________________ (557.6) (52.8) (701.6) _______________________________________________________________ Provisions for (54.0) (12.5) (55.7) liabilities and charges _______________________________________________________________ 1,328.6 403.9 1,283.7 =============================================================== Equity capital and reserves Called up share 29.2 13.9 29.1 capital Share premium account 1,073.7 213.0 1,071.9 Revaluation reserve 5.5 5.6 5.5 Profit and loss 220.2 171.4 177.2 account _______________________________________________________________ Equity shareholders' 1,328.6 403.9 1,283.7 funds =============================================================== Gearing 56.8% 14.2% 60.6% Consolidated Cash Flow Statement (Unaudited) 26 weeks 26 weeks 53 weeks Notes to 2 July to 27 June to 2 Jan 2000 1999 2000 £m £m £m Net cash inflow from 10 105.2 39.2 191.8 operating activities ________________________________________________________________________ Servicing of finance and return on investments Net interest paid (24.4) (4.2) (25.7) Dividends received 3.0 - - ________________________________________________________________________ Net cash flow from servicing of finance and (21.4) (4.2) (25.7) returns on investments Taxation paid (9.6) (0.4) (53.2) ________________________________________________________________________ Net cash flow before 74.2 34.6 112.9 investing activities Purchase of tangible (12.0) (13.8) (34.6) fixed assets _________________________________________________________________________ Net cash flow before acquisitions 62.2 20.8 78.3 and disposals _________________________________________________________________________ Sale of subsidiary - - 3.9 Purchase of subsidiaries 10 (6.7) - (421.1) Net overdraft acquired - - (1.1) _________________________________________________________________________ Net cash flow from acquisitions (6.7) - (418.3) and disposals _________________________________________________________________________ Equity dividends paid (32.9) (14.0) (27.6) _________________________________________________________________________ Net cash flow before 22.6 6.8 (367.6) financing _________________________________________________________________________ Financing Issue of shares 1.4 1.2 6.4 Bank borrowings (29.9) (27.6) 354.3 (repaid)/received Principal payments under finance leases (2.1) (2.3) (4.3) _________________________________________________________________________ Net cash flow from (30.6) (28.7) 356.4 financing _________________________________________________________________________ Decrease in cash (8.0) (21.9) (11.2) ========================================================================= Consolidated Cash Flow Statement (Unaudited) 26 26 53 Notes weeks weeks weeks to to to 2 July 27 June 2 Jan 2000 1999 2000 £m £m £m Reconciliation of movement in net debt Opening net debt (778.5) (65.7) (65.7) Borrowings repaid/(drawn 32.0 29.9 (350.0) down) Loan notes issued - (0.3) (2.0) Net debt acquired with - - (350.5) subsidiary Other movements - 0.8 0.9 Decrease in cash (8.0) (21.9) (11.2) ___________________________________________________________ Closing net debt 11 (754.5) (57.2) (778.5) =========================================================== Notes to the financial statements 1. Basis of preparation (i) The merger in 1999 On 6 September 1999 the merger of Trinity plc and Mirror Group PLC became effective and Trinity changed its name to Trinity Mirror plc. Trinity Mirror accounted for the merger as an acquisition in accordance with Financial Reporting Standard ('FRS') 6 'Acquisitions and Mergers'. On this basis the audited statutory consolidated profit and loss account for the year ended 2 January 2000 comprises the results of Trinity for the full 53 week period and the results of Mirror Group for the period from 6 September 1999 to 2 January 2000. The unaudited statutory profit and loss account for the twenty six weeks to 27 June 1999 comprises the results of Trinity only for the period. (ii)Basis of pro forma financial information The pro forma unaudited consolidated profit and loss accounts for the 26 weeks to 27 June 1999 and 53 weeks to 2 January 2000 are derived from the consolidated financial statements of both Trinity and Mirror Group. The pro forma financial information for the period to 2 January 2000 includes the results for the 53 weeks of Trinity and 52 weeks of Mirror Group. The pro forma consolidated profit and loss account for the 26 weeks to 27 June 1999 includes the results for the 26 weeks of Trinity and 26 weeks of Mirror Group. The pro forma unaudited consolidated profit and loss accounts have been presented as if the merger took place on 28 December 1998, being the first day of each of the financial accounting periods presented. The pro forma unaudited consolidated profit and loss accounts include adjustments made by Trinity Mirror management that it believes to be reasonable. The adjustments primarily reflect the impact of fair value adjustments made at the assumed acquisition date and the interest charge implications of the acquisition assumed to have occurred at the commencement of the relevant accounting period. (iii)Accounting policies The accounting policies used in the preparation of the interim financial statements for the 26 weeks to 2 July 2000 are as set out in the Group's financial statements for the 53 weeks ended 2 January 2000 as amended by the adoption in this period of FRS 15 'Tangible Fixed Assets' and FRS 16 'Current Taxation', neither of which had an impact on the profit and loss account. The transitional arrangements of FRS 15 are being adopted in respect of certain freehold buildings included within 'land and buildings', where the valuation of £33m has not been updated since 1988. The value of these assets is now frozen at modified historic cost. 2. Turnover The analysis of the Group's turnover is as follows: Statutory Pro forma 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m By geographical destination: UK & Republic of Ireland Continuing 553.3 168.0 589.1 515.3 1,036.9 Discontinued - - 2.0 6.5 10.6 Continental 6.2 - 4.4 6.1 14.6 Europe Rest of the World 0.4 - 0.3 - 0.9 ________________________________________________________________ 559.9 168.0 595.8 527.9 1,063.0 ================================================================ 2. Turnover (continued) Statutory Pro forma _____________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m By type: Advertising 295.7 119.0 332.0 277.1 558.2 Circulation 203.4 34.4 173.6 195.8 392.8 Other Continuing 60.8 14.6 88.2 48.5 101.4 Discontinued - - 2.0 6.5 10.6 ________________________________________________________________ 559.9 168.0 595.8 527.9 1,063.0 ================================================================ By division: Established activities Regional 245.3 162.5 375.7 231.1 462.4 newspapers * National 268.9 - 189.8 253.2 520.0 newspapers Sport 15.6 - 8.3 12.1 24.3 Magazines and 21.0 4.9 18.2 18.9 34.1 exhibitions Other 6.6 - 3.4 11.5 19.6 ________________________________________________________________ 557.4 167.4 595.4 526.8 1,060.4 Developing activities Digital media 2.0 0.6 0.4 1.1 2.6 Metros 0.5 - - - - ________________________________________________________________ 559.9 168.0 595.8 527.9 1,063.0 ================================================================ *Includes turnover relating to Belfast Telegraph Newspapers of £28.2m (1999: 26 weeks £26.6m, 52 weeks £52.8m). Belfast Telegraph Newspapers was sold on 30 July 2000. Developing activities are regarded by the Directors as those activities that are new business areas, in their investment and implementation phase and requiring further development before becoming viable and sustainable businesses. All other Group operations are classified as established activities. _________________________________________________________________ By nature: Continuing 559.9 168.0 593.8 521.4 1,052.4 operations Discontinued - - 2.0 6.5 10.6 operations ________________________________________________________________ 559.9 168.0 595.8 527.9 1,063.0 ================================================================ 3. Group operating profit The analysis of the Group's operating profit (before exceptionals) is as follows: Statutory Pro forma _____________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m By division: Established activities Regional 66.8 43.8 94.1 60.7 113.8 newspapers * National 55.4 - 39.0 52.4 103.6 newspapers Sport 4.1 - 2.2 2.6 5.2 Magazines and 4.8 0.9 3.9 4.6 7.6 exhibitions Other 1.3 - (0.3) (2.3) (2.8) ________________________________________________________________ 132.4 44.7 138.9 118.0 227.4 Developing activities Digital media (12.4) - (4.4) (1.1) (6.3) Metros (2.5) - - - - ________________________________________________________________ 117.5 44.7 134.5 116.9 221.1 ================================================================ * Includes operating profit relating to Belfast Telegraph Newspapers of £11.9m (1999: 26 weeks £10.8m, 52 weeks £20.5m). By nature: Continuing 117.5 44.7 135.4 119.2 224.6 operations Discontinued - - (0.9) (2.3) (3.5) operations ________________________________________________________________ 117.5 44.7 134.5 116.9 221.1 ================================================================ 4. Share of results of associated undertakings Statutory Pro forma ______________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m Continuing investments Established 0.7 - 0.6 0.5 1.2 activities Developing activities - (0.8) (0.1) (0.3) (0.3) (0.6) digital media ________________________________________________________________ (0.1) (0.1) 0.3 0.2 0.6 Discontinued - - - 2.4 2.4 investment ________________________________________________________________ (0.1) (0.1) 0.3 2.6 3.0 ================================================================ 5. Exceptional items Statutory Pro forma _____________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m Restructuring (7.7) - (8.3) (1.9) (9.5) costs (a) ________________________________________________________________ Included in (7.7) - (8.3) (1.9) (9.5) operating profit ________________________________________________________________ Gain on sale of - - - 31.5 31.5 investments (b) Loss on termination of - - (4.6) (1.4) (7.6) operations (c) ________________________________________________________________ - - (4.6) 30.1 23.9 ________________________________________________________________ Share of exceptional item - - 0.6 2.4 2.2 of associated undertaking (d) Net interest - - - (3.9) (3.9) payable (e) ________________________________________________________________ (7.7) - (12.3) 26.7 12.7 ================================================================ (a) Restructuring costs relate primarily to management and other redundancies incurred and assets written off as a result of the merger of Trinity and Mirror Group. (b) In March 1999 Mirror Group disposed of its investment in Scottish Media Group for consideration of £110m. After writing-off the investment and goodwill, a net profit of £31.5m was realised. This gain is recognised in the pro forma profit and loss account only. (c) The loss on termination of operations related primarily to the closure of Live TV in November 1999, which resulted in a net loss of £5.6m, and the costs of the cancelled launch, prior to the merger, of the new Sporting Life title, amounting to £2m. (d) The share of associated undertaking's exceptional item relates to the net profit on disposal of businesses during 1999 by The Press Association. (e) Subsequent to the sales of the Holborn property and the investment in Scottish Media Group by Mirror Group, prior to the merger, interest rate swaps with a principal amount of £200m were cancelled at a cost of £3.9m. 6. Taxation The charge for taxation is as follows: Statutory Pro forma ____________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 £m £m £m £m £m Underlying UK corporation 24.8 12.9 32.6 23.0 44.9 tax Deferred taxation 1.0 0.3 (1.6) 1.0 (1.8) Tax in associated undertakings 0.2 - - - 1.7 ________________________________________________________________ 26.0 13.2 31.0 24.0 44.8 Exceptional UK corporation (1.9) - (2.8) (1.1) (4.9) tax Deferred taxation (0.4) - - - - ________________________________________________________________ 23.7 13.2 28.2 22.9 39.9 ________________________________________________________________ The taxation charge has been calculated by applying the Directors' best estimate of the annual effective tax rate to the taxable profit for the period. The statutory tax rate for the period is 30%. 7. Dividends The Directors have declared the payment of an interim dividend of 5.3p (1999 - 4.8p) per 10p ordinary share. The total dividend in 1999 was 16p. 8. Earnings per share The calculation of earnings per share is based on the profit on ordinary activities after taxation, using the weighted average number of shares in issue (basic) increased by the number of share options in issue (diluted) as shown below. Statutory Pro forma _______________________________________________ 26 weeks 26 weeks 53 weeks 26 weeks 53 weeks to to to to to 2 July 27 June 2 Jan 27 June 2 Jan 2000 1999 2000 1999 2000 No. of No. of No. of No. of No. of shares shares shares shares shares Basic 289.6 139.4 186.9 288.2 288.5 (millions) ============================================================= Diluted 290.6 140.9 188.6 289.7 290.3 (millions) ============================================================= 9. Intangible assets The movement in intangible assets in the period of £3.7m reflects adjustments of £5.7m made to the provisional fair values applied to the net assets of Mirror Group as at 6 September 1999 (date of acquisition),offset by £0.5m amortisation of goodwill and a £1.5m reduction in the costs of acquisition. 10.Consolidated cash flow statement Net cash flow from operating activities comprises: Statutory __________________________ 26 weeks 26 weeks 53 weeks to to to 2 July 27 June 2 Jan 2000 1999 2000 £m £m £m Group operating profit 109.8 44.7 126.2 Depreciation and amortisation 20.5 7.0 24.0 Movements in working capital Stocks (1.0) 0.5 (1.6) Trade and other debtors and prepayments (11.0) (9.8) 28.3 Trade and other creditors and accruals (13.1) (3.2) 14.9 _______________________________________________________ Net cash flow from operating activities 105.2 39.2 191.8 ======================================================= Cash payments of £6.7m for purchase of subsidiaries relate to deferred payments of consideration or related costs in respect of prior period acquisitions. 11. Analysis of net debt 2 January Cash Other non cash 2 July 2000 flow movements 2000 £m £m £m £m Cash at bank and in 50.2 (20.0) (0.3) 29.9 hand Overdrafts (33.9) 12.0 0.3 (21.6) Debt due after one (647.4) 63.9 77.0 (506.5) year Debt due within one (90.0) (34.0) (77.0) (201.0) year Finance leases (57.4) 2.1 - (55.3) __________________________________________________________________ (778.5) 24.0 - (754.5) =================================================================== 12. Reconciliation of movements in shareholders' funds 26 26 53 weeks weeks weeks to to to 2 July 27 June 2 Jan 2000 1999 2000 £m £m £m Profit attributable to 58.2 29.4 74.8 shareholders Dividends (14.9) (6.7) (46.4) ________________________________________________________________ Retained earnings 43.3 22.7 28.4 New share capital subscribed 1.9 1.2 875.2 Other recognised gains and losses - - 0.1 Effect of share option expenses (0.3) - - incurred by parent company ________________________________________________________________ Net increase in shareholders' 44.9 23.9 903.7 funds Opening shareholders' funds 1,283.7 380.0 380.0 ________________________________________________________________ Closing shareholders' funds 1,328.6 403.9 1,283.7 ================================================================ MORE TO FOLLOW

Companies

Reach (RCH)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today