Weak ad market hits Scottish Media
SMG posts 48% decline in pre-tax profit
The company reported Wednesday that its pre-tax profit had fallen by 48% to £5.5 million ($8.7 million) in the six months to June 30.
Its operating profit dropped by $7.9 million to $22 million and its revenue dipped by $9.5 million to $137 million.
Despite the lackluster results, SMG maintains it held market share and outperformed competitors and expects to report better results for the second half of the year.
The last six months have been a period of transition for SMG. Company completed the $343 million disposal of its publishing business, which reduced debt by 40% to $391 million. Group also pointed to the successful outcome of its legal battle with broadcaster-presenter-media mogul Chris Evans, who was ordered to pay his former employer Virgin Radio $11 million after a judge ruled he had broken his contract with the broadcaster by not reporting for work.
"The early part of the summer saw a continuation of the weak advertising markets that have been a feature of the first half," CEO Andrew Flanagan said. "But we are cautiously optimistic about the second half of the year, where we are already detecting signs of significant improvement in each of our businesses. However, we believe that it is too early to take a view on whether or not this is the start of the sustained upturn."
