Embargoed until 12 noon 26 May 2006
Ulster Television plc
Chairman's AGM Statement
Ulster Television Chairman, John B McGuckian gave the following trading update
at the annual general meeting of Ulster Television plc (UTV) today.
"Your company's success in both outperforming the market and in creating new
profit streams has been amply demonstrated over the past few years and is again
evident in the Report and Accounts which are laid before you today. In a
landmark year, and despite difficult trading conditions, earnings per share
increased by 18% while foundations for future growth were laid.
"These foundations are already being built upon in 2006, with like-for-like
revenue growth in our radio stations in Great Britain up by 13% in the first
quarter compared to an 8% decline in the market as a whole. Continuing
outperformance is expected in the second quarter with the soccer World Cup
delivering a further stimulus to our national radio station, talkSport, and
helping to drive an expected 15% like-for-like improvement in our GB radio
advertising revenue compared to an anticipated 2% decline in the market in the
six months to 30 June 2006.
"Substantial outperformance is also being achieved in our Irish radio division
where like-for-like advertising revenue is forecast to grow by 15% in the first
half and where particularly favourable economic conditions in the Republic of
Ireland should maintain the momentum of growth into the second six months of
"Our new radio stations in Belfast and Edinburgh have got off to a good start
and are on target to achieve profitability in year three as planned, although
in the current year budgeted losses of just under £2M will impact upon profit
growth. Nevertheless, the strong performance of our other radio assets should
enable us to readily absorb these losses while significantly improving the
contribution to the bottom line.
"The contribution from television to group profitability continues to be
affected by adverse trading conditions in the television advertising market.
The expected stimulus to the market of the football World Cup in June has not
materialised and we are now forecasting our television advertising revenue to
be down by 6% in the first half of 2006. While this would significantly
outperform ITV1 and take our share of network revenue to a record high of
2.78%, nevertheless the anticipated reduction in revenue, coupled with
increased network programme costs in respect of the World Cup, will put margins
"An anticipated revenue increase of 16% in our internet division in the first
six months will be driven by broadband and telephony growth. Coupled with
higher margins, this should deliver improved profitability for the half year.
"Overall, then, the year to date is again characterised by outperformance. This
outperformance, particularly in radio, should mitigate against the generally
difficult trading conditions in advertising and help to sustain further
progress for your company in the current year."
For further information:
John McCann, Group Chief Executive +44 (0)28 9026 2202
Jim Downey, Group Financial Director +44 (0)28 9026 2176
Orla McKibbin, Head of Press and PR +44 (0)28 9026 2188
Powerscourt +44 20 7236 5615
Anthony Silverman +44 7909 926 020
Rory Godson +44 7818 036 579