US sales help boost Emap's profits to pounds 161.6m

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The Independent Online
EMAP, THE international magazine publisher and radio broadcaster, yesterday forecast a rebound in UK and French advertising markets through the end of this year and into 2000 after warning of currently slower conditions.

"There has been a slowdown but things appear to be picking up," said the chief executive Kevin Hand, who blamed the comparatively soft performance on the one-off fillip to sales provided last year by the World Cup. He spoke as Emap unveiled a 14 per cent gain in pre-tax profit to pounds 161.6m for the year to March.

The period incorporated a two month contribution from US magazine publisher Petersen, which Emap acquired for $1.2bn in January.

The company said it has pounds 100m-pounds 130m to spend on bolt-on acquisitions that can be integrated with and boost margins in existing publishing areas. Emap, whose core magazines operation publishes over 600 consumer, business and niche titles in Britain, France and the US, is also boosting Internet investment to pounds 8m-pounds 10m this year, from pounds 6m last year.

A strategic review of Emap's Internet plans is underway, with an aim to focus on areas which can deliver transaction revenue. "We don't want to blast Internet sites all over the net," Mr. Hand said. "We want to concentrate on what we do, and do it well."

The group's key titles include the top-selling British men's magazine FHM, French women's magazine Top Sante and US publications such as Hot Rod, Guns & Ammo and Teen. Current year advertising revenue growth is expected to be some 5 - 7 per cent.

Petersen, Emap's new American operation, is expected to show stronger growth though an emphasis on leveraging its brands and building audiences through a series of new ventures.

One new product is NFL Insider magazine, a joint venture with the National Football League that will have a circulation of over 1m when Emap launches its first edition as publisher in September.

Mr Hand said the radio division, whose British station portfolio now includes Melody and Magic, still possesses decent revenue growth potential, although current ownership regulations restrict Emap from further expansion.

For fiscal 1999, annual sales grew 14 per cent to pounds 880.1m and the total dividend jumped 15 per cent to 16.6p. Emap stock closed up 2p at 1307p.