INM reports increase in profits and sales across all operations

Independent News & Media, the publisher of The Independent, has seen all its worldwide operations increase profits and revenues in the first half of this year.

The results were buoyed by cover price increases at the company's newspapers, leading to a 5.5 per cent gain in circulation revenues. Advertising revenues also rose, by 3.8 per cent, for the six months to 30 June.

Group operating margin edged up to 18.56 per cent, leaving the company on target to hit a 20 per cent profit margin this year, a goal set by INM five years ago.

The company again benefited from its presence in some of the world's faster-growing economies, including South Africa, where revenues jumped 16.4 per cent, driven by a strong advertising market. The company's operations include interests in Australia, New Zealand, India, the UK and the Republic of Ireland.

Sir Anthony O'Reilly, the chief executive, said: "INM's geographically diversified portfolio of market-leading assets, across diverse multi-media platforms, continues to underpin INM's clear and compelling international growth strategy ... This performance and these prospects continue to distinguish the group from its international peers."

Group revenues increased by 3.6 per cent to €796.7m (£540m), while operating profit, before exceptionals, gained 4.9 per cent to €147.9m.

In the UK, strong circulation revenue growth and additional contract printing sales in Belfast saw revenues increase by 3.4 per cent to €107.8m.

Overall UK group advertising revenues fell 5.8 per cent in the period as a result of the weak classified market - particularly in government and NHS spending - which affected the Belfast Telegraph and the magazines division. The company reduced the headcount in its Belfast operations by 120 people in the first half, which will save more than £3m a year.

The Independent and The Independent on Sunday, bucked the downward trend in the UK ad market with a 1 per cent gain against a fall of at least 5 per cent across the sector. This came against tough comparisons, as the first half of last year saw the Independent titles enjoy an 18.5 per cent jump in ad sales.

Ivan Fallon, the chief executive of INM (UK) and an INM board member, said: "We held on to these [advertising] gains and even increased revenues, which is a much better result than anyone else."

He said losses at the Independent titles should be down by "a couple of million" for 2006, an improvement on the £10m loss made last year.

Mr Fallon said recently released readership figures were "absolutely fantastic".

The National Readership Survey, released last week, showed The Independent on Sunday recorded the best circulation performance of any British paper in 2006, with a 9 per cent gain in the six months from March to August. The figures also showed The Independent's readership is at a nine-year high, up 24 per cent in the 12 months to June 2006.

Mr Fallon said the readership gains were the highest among groups most attractive to advertisers, including a 48 per cent rise among those aged 15 to 44.