Yell posts loss after £15m bill for cancelled float

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The Independent Online

Yell, the yellow pages company formerly owned by BT, yesterday admitted that its aborted plan to float on the London stock market had cost it about £15m.

Yell, the yellow pages company formerly owned by BT, yesterday admitted that its aborted plan to float on the London stock market had cost it about £15m.

That charge, along with higher interest payments on borrowings, pushed the company, which BT sold last year to two venture capital houses for £2.1bn, heavily into the red in the first quarter of the year.

The company reported a pre-tax loss of nearly £31m in the three months to 30 June, compared with a profit of £29.3m in the same quarter a year ago.

Interest payments had increased to £57.6m from £10.2m in the quarter, while goodwill amortisation charges had jumped to £23.6m from £7.1m.

John Davis, Yell's chief financial officer said: "At an operating profit level, comparisons with last year need to allow for £15m of administrative exceptional costs relating to our withdrawn flotation and a £17m increase in goodwill amortisation."

On an underlying, or Ebitda, basis, Yell reported a profit of £70.6m, an increase of 29.5 per cent over last year on sales up 28.2 per cent to £248.5m.

The figures included the results of McLeod, the US directories business that Yell bought in April for $600m (£395m). Stripping that out, Yell's Ebitda profit grew 13.2 per cent to £61.7m while sales were up 4.2 per cent to £202m.

John Condron, chief executive, said: "These results show the continued good progress of our businesses both in the UK and the US. They also demonstrate the strength of our management over a period when substantial focus was needed on our potential flotation.

The company's yellow pages business in the UK grew sales by 6.3 per cent, fuelled by an increase in the number of advertisers to 130,637 from 125,470.

The UK business, which made an underlying profit of £53m, up 5 per cent, said it would meet its target of getting 100,000 new advertisers this year.

In the US, sales from its Yellow Book operation were up 8.6 per cent, although its Manhattan directory was hit hard by the effects of 11 September.

Mr Condron said: "Yell has a powerful platform to continue delivering improved results. Our operational focus will remain upon growing our customer base through improved products and services and growing our margins through the progressive maturing of our US directories portfolio and securing the revenue and cost benefits of integrating our Yellow Book East and West operations."

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