Sell-offs boost profits at Scottish Television

Click to follow
The Independent Online
Exceptional gains of pounds 33.2m from disposals helped Scottish Television achieve record profits of pounds 61.2m last year. The acquisition of Caledonian Publishing has also provided the group with a broader operating base and made a significant contribution to profits.

The group plans to change its name later this year to reflect the move towards a multimedia company, executive chairman Gus Macdonald said yesterday.

The recent sale of the 20 per cent stake in HTV acquired from Flextech in 1995 to United News & Media was part of a programme of selling off low-yielding investments to help finance the pounds 120m paid for Caledonian. The disposal realised pounds 73.7m and created an exceptional gain of pounds 37.3m.

United also bought Scottish TV's 5 per cent stake in ITN, which yielded a further exceptional profit of pounds 3.9m.

Excluding exceptionals, profit before tax was still up 40 per cent to pounds 28m and operating profits rose 37 per cent to pounds 25.6m.

Turnover from continuing operations grew by 16 per cent to pounds 114.7m. Operating profit from continuing operations increased by 26 per cent to pounds 23.9m, earnings per share rose by 13 per cent to 31p and a final dividend of 13.2p brings the full- year figure to 18.7p, an increase of 15 per cent. .

Broadcasting turnover rose by 8 per cent and operating profits rose by 24 per cent to pounds 20.6m. Advertising revenues also improved 8 per cent to pounds 81.4m, increasing the company's share of ITV net advertising revenue from 4.77 per cent to 4.91 per cent. In the second half of the year it was back above 5 per cent.

Programme sales leapt by 47 per cent to pounds 29.3m, helped by delayed deliveries from the previous year and several new commissions including the drama series McCallum. Programme sales contributed record operating profits of pounds 3.3m.

Caledonian Publishing, publishers of the Glasgow-based Herald and Evening Times, contributed pounds 12.6m to turnover and pounds 1.7m to operating profits in the final 12 weeks of the year. The integration of Caledonian is proceeding smoothly, cost reduction targets are being achieved and the opportunities for selling advertising across television and newspapers show great potential, according to Mr Macdonald.

Audience figures for Sky Scottish, the new satellite channel launched with BSkyB in November have been initially small but the financial impact on the group is minimal to date.

The outlook for 1997 is good in spite of the uncertainties created by the impending general election. Disposals leave Scottish Television with pounds 14m of net cash and make it well placed to fund future expansion. The shares rose 7.5p to 637.5p.