MAI set for pounds 270m expansion

MATHEW HORSMAN

MAI, the financial services and media company, is planning a pounds 200m expansion of its media and financial information businesses, Lord Hollick, its chief executive, said yesterday.

"We would certainly look at satellite and cable broadcasting, either alone or with partners," he added.

But he insisted the company was not prepared to abandon its financial services activities, which suffered a 30 per cent fall in profits in the year to June.

"That is not in the game plan," Lord Hollick said. "We are very comfortable with the businesses we've got."

News of the company's acquisition plans followed the announcement of full-year pre-tax profits, before extraordinary items, of pounds 115.6m, up 20 per cent. Revenues rose to pounds 813.3m from pounds 695.3m.

Media operations, including MAI's two ITV licence-holders, 61 per cent- owned Meridian and wholly owned Anglia Television, generated 43 per cent of turnover and 37 per cent of profits, the first time media made a larger contribution than financial services.

The broking businesses saw profits of just pounds 42.9m on the full year, a drop of 30 per cent, on turnover down 6 per cent to pounds 332.6m The full-year profits slump masked a recovery in the second half after a severe downturn in market volumes in the six months to December 1994.

Analysts expect MAI's broking side to continue to improve, particularly in areas where it is market leader. These include US government securities and spot currency trading. Over-capacity in the market is likely to lead to the failure of some broking companies, which would tend to benefit those with a dominant position.

MAI is also expected to expand its information operations, which include market research firm NOP in the UK. Profits from financial information services, linked to the company's broking activities, also continued to grow.

Lord Hollick conceded that media assets were a preferred growth area. In addition to possible cable and satellite investments, MAI is also part of a consortium bidding for the Channel 5 licence. If successful, the consortium would spend more than pounds 100m a year on programming.

Investment Column page 18