Star newspaper group records 6.8% fall in profits

CIARÁN HANCOCK, Business Affairs Correspondent

THE TERENURE-based Star newspaper group recorded a 6.8 per cent decline in its profit in 2008, a year when sales were flat.

The company, which is jointly owned by Independent News & Media and Richard Desmond’s Express Newspapers in the UK, made a pretax profit of €6.8 million in the year to the end of December 2008.

This compared with a surplus of €7.3 million a year earlier.

Turnover at Independent Star Ltd was flat at €46.9 million.

The company, which publishes the Irish Daily Star and a Sunday version of the paper, paid a dividend of €6.6 million last year to its shareholders, compared with €6.8 million a year earlier.

The dividend was paid equally to its two backers.

Commenting on the likely out-turn for 2009, managing director Paul Cooke told The Irish Times : “We are making money and we’re in line with our budget, but the profit will be down on 2008.”

The Star’s circulation also declined slightly in 2008. The daily paper reported an average circulation of 107,227, down 1.7 per cent year on year.

The Sunday title, meanwhile, reported an average circulation of 60,637, a decrease of 4.3 per cent.

Mr Cooke said the group’s circulation is down about 3-4 per cent so far this year.

“Everybody is down, but we’re outperforming the tabloid market,” he added.

On a daily basis, the Star competes with the Irish Sun , the Irish Mirror and the Irish Daily Mail. On Sundays, it competes primarily with the News of the World , the Irish Mail on Sunday and the Sunday Mirror. 

Independent Star Ltd had retained profits of €1.15 million at the end of 2008. This was down from €1.44 million a year earlier.

Its net debt, meanwhile, almost trebled to €781,924.

The accounts show that the company employed an average of 140 staff during the year, the same level as in 2007.

They earned €9.1 million between them in wages and salaries, an increase of 4.4 per cent on the previous 12 months.

Directors’ remuneration declined by almost 12 per cent during the year to €861,317, according to the financial statements.

The accounts state that INM provided printing and distribution services to the company to a total value of €9.76 million in 2008.

This represented an increase of 7.3 per cent over the previous year.

Independent Star Ltd was owed €3.3 million by other INM companies at the end of 2008, while it owed just more than €1.9 million to the listed group.

The company provided distribution services to Express Newspaper to the value of €63,532 during the year.

This was roughly five times the level of 2007.

Independent Star Ltd is a 50-50 joint venture between INM and Express Newspapers.