Independent News shares surge as profits hit record level

INDEPENDENT News & Media, owner of The Independent and The Independent on Sunday, yesterday announced a 47 per cent surge in pre-tax profits for the first half of this year to a record 61m euros, bolstered by a strong performance from the group's operations in Ireland, Australia and New Zealand.

Dr AJF O'Reilly, the chairman, said that the continued strength of the Irish and Australian economies, and a further improvement in the economy in New Zealand, position the group well for a successful 1999 as a whole.

Liam Healy, chief executive, added that all the signs were that the group would have a very successful second half, when Independent News is also expected to derive a quite considerable benefit from favourable swings in national currencies.

The recovery in New Zealand, where the economy has been in the doldrums, began in the second quarter and there is now every indication that it will be sustained into the years ahead.

Independent News & Media shares rose 12.5p on the London stock market yesterday to 315p after a number of analysts moved to upgrade their forecasts for the full year in the light of the results.

The UK operations performed well, despite the economic slowdown, with the group's two national titles, The Independent and The Independent on Sunday, continuing to make progress.

The circulation of the daily title increased throughout the period, reaching 225,516 in June, the highest circulation since January 1998. Market share in June, at 9.5 per cent, was at its highest level since November 1997.

Continued improvement in circulation is expected in the second half.

Financial results for the UK operations were adversely affected by a fall off in classified advertising, which hit the regional titles and magazines as well as the national titles.

In Ireland, the group returned to double-digit profits growth after the slowdown in the second half of last year. Continued strong expansion in the Irish economy resulted in record levels of activity and profits across all operating divisions.

All key advertising sectors remain buoyant, with demand so strong that the group is often forced to hold out advertising from its national titles.

Circulation of the Irish Independent has achieved a 17-year high and market share has been further enhanced.

The other notable performer in the group's portfolio of interests was Australia where APN, Australia's largest operator of regional newspapers, radio stations and outdoor advertising, reported a 53 per cent upswing in pre-tax profits to A$36.7m (pounds 14.7m).

The group believes it is well positioned to benefit from next year's Olympic games.

The interim dividend is being increased by 17 per cent from 3.81 cents to 4.44 cents. A scrip alternative is also being made available.