IN&M forecasts growth in advertising revenues

Independent News & Media (IN&M) last evening rushed out a pre-close trading statement reaffirming its forecast of "high single-digit growth" in Irish advertising revenues after Johnston Press warned of an advertising slump in its Irish regional newspapers.

In an update released eight days earlier than planned, the publisher of the Irish Independent said the rise in Irish advertising will be achieved in spite of a "sharp downturn" in property advertising.

The group said it brought forward its update "to confirm to the market IN&M's strong trading performance in 2007, following recent negative commentary on global advertising in general and certain aspects of the Irish advertising market in particular".

This was a reference to a pre-close update from Johnston Press - publisher of the Leinster Leader and other titles - which warned of a sharp deterioration in advertising due to the property downturn. "Advertising revenues in the Republic of Ireland declined by 1.2 per cent, compared to the growth of 10 per cent in the first six months, a reflection of the recent slowdown in the local economy which has particularly impacted the property market," Johnston Press said.

The group's titles include the Kilkenny People, the Limerick Leader, the Longford Leader and Dundalk Democrat. With analysts questioning whether the Johnston warning pointed to tougher conditions for IN&M - a significant publisher of regional and national titles - the group reaffirmed its market guidance to journalists before publishing its full update shortly before 6pm.

IN&M shares had closed 2.6 cent stronger at €2.20, after dropping as low as €2.10 in morning trading. "We are pleased to say that, despite the global turmoil experienced in the second half of 2007, your group is trading in line with expectations and remains well-positioned for future growth," said IN&M chief Sir Anthony O'Reilly.

With top line revenues set to rise 3 per cent overall in the fiscal year, IN&M said advertising revenues in its publishing operations will grow by some 4 per cent year-on-year while circulation revenues expand by 1 per cent.

"Throughout 2007, retail, run-of-press/national and classified advertising was consistently strong and property advertising in total across the group was ahead of 2006, despite a sharp slowdown in Irish property advertising. However, the broad range of sources of the group's Irish advertising revenues are such that it is expected to show high single digit percentage growth in total in 2007."

Stating that all markets were showing advertising growth in publishing online, IN&M said such advertising will rise by 70 per cent in the year.