Market slump hits Irish Press plc

The financial position of Irish Press plc has deteriorated, with the company's listed investments hit by the stock market slump.

In the nine months to December 31st, 2002, the company made a pre-tax loss of €563,000 on a turnover of €1.3 million. In the year to March 31st, 2002, it produced a pre-tax profit of €5.9 million. This included a €7.6 million legal settlement it got from E M Warburg Pincus & Co following a long-running legal battle.

One of the main contributors to the loss was a €536,000 exceptional reduction in the value of the Irish Press's quoted investments. The company said this reduction could be permanent.

While the company shareholders will welcome the awarding of a dividend - 25 cents per share - there may be concern about the value of the company's investments.

According to the company's chairman, Mr Vincent Jennings, it made provision for the €536,000 reduction in the value of its quoted investments for prudent reasons. In his statement Mr Jennings said: "This decision reflects the ongoing uncertainty in the stock market and some long term trends."

He added: "The decision might appear in some ways to be overly conservative, and an improvement in the financial markets and world economy could lead to an add-back of value to the investments, but the directors believe this is a prudent step for them to take and gives a fairer view of the group's position."

The group's listed assets might have been worth €3.1 million if the exceptional provision was not included.

The payment of the dividends will cost the company €216,000, but Mr Jennings also sounded a note of caution about dividend policy going forward.

"As I stated last year the directors are anxious to continue paying dividends but reduced returns from cash and financial investments in the current uncertain economic climate and the prospects for 2004 may make this a difficult policy to sustain," he said.

While the company is mainly involved in media investments, it still employs an average of 34 people, according to its financial statements - an increase on 12 in the year to March 31st, 2002.