Investment Column: Success story in local papers
Wednesday 17 June 1998
The company, which yesterday reported a 47 per cent increase in profit to pounds 11m, believes that the complementary nature of its 20 regional papers and 184 local shops will deliver long-term growth.
The rationale seems simple enough: the steady earnings stream of local retailing helps to offset the cyclical swings of the newspaper business, where advertising revenue is at the mercy of the vagaries of the economy.
Not that Portsmouth and Sunderland needs to worry about its publishing business just at the moment. Last year, operating profit at its newspaper stable, which includes the Portsmouth News and the Sunderland Echo, rose 35 per cent, outdoing the retailing arm where earnings were up 32 per cent.
The growth was driven by higher advertising revenue, with recruitment ads up by a third on the back of a buoyant labour market. Revenues rose by another 10 per cent in April and May.
However, with local advertising approaching a peak Portsmouth and Sunderland remains vulnerable to a downturn. And the stores, which contributed 28 per cent of profits last year, will offer only limited protection.
The shares jumped 163p yesterday to an all-time high of 1125.5p. On a multiple of around 15 times house broker HSBC Securities' earnings forecast, the shares look about right.
- 1 President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
- 2 Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations
- 3 Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
- 4 UK weather: 'Coldest night of the year' tonight as freezing temperatures plummet to -10C
- 5 Game of Thrones is most-pirated TV show of 2014
President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
Exclusive: Abusers using spyware apps to monitor partners reaches 'epidemic proportions'
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations
Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
AirAsia flight QZ8501 missing: Search for plane carrying 162 passengers from Indonesia to Singapore suspended overnight
Millions of Britons struggling to feed themselves and facing malnourishment
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Ukip member gets into Christmas spirit with Union Flag plea to Santa 'for our country back'
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Nigel Farage: Ukip leader named 'Briton of the year' by The Times
Immigrants make UK racist, says Ukip councillor Trevor Shonk
iJobs Money & Business
Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...
Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...
Not specified: Selby Jennings: SVP Model Validation This top tiered investment...
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...