The owner of Ireland on Sunday, Associated Newspapers Ireland, has reported a pre-tax loss of €14.6 million for its first year of operation
The accounts covering the year to September 2002 show that Associated, which publishes the Daily Mail in Britain, had €11.3 million of administrative expenses, which seriously eroded its bottom line. This money is believed to relate to marketing, promotions, information technology, production costs and new premises in Ballsbridge, Dublin.
The company has grown the circulation of the paper during this period from 30,000 to about 160,000. It bought Ireland on Sunday in November 2001 from a group of investors, which included Mr Paschal Taggart.
The accounts, just lodged with the Companies Office, show that the company had a turnover of €3.5 million to September 2002, but the cost of sales was €6.8 million. After administrative expenses of €11.3 million were added, the company produced an operating loss of €14.6 million.
The company has invested heavily in the title during the past year and a half, with several new staff joining and free items often accompanying the title, particularly CDs.
According to the accounts, Associated employs four managers and 44 "administrative" staff. Some €2.7 million in salaries was paid out, with directors picking up €219,865 in emoluments. No tax was paid during the period because of the losses incurred.
While the losses were steep, the company expects these to reduce as advertising revenue starts to increase - however, there are no details on advertising revenue in these accounts.
Media sources said that, while the company's losses were considerable, putting in new equipment and acquiring premises indicated that the company was considering launching a new mid-market daily title to challenge the Irish Independent. Advertisers expect the company to launch the title either later this year or sometime in 2004.
The company's liabilities exceeded its assets but its parent company, Associated Newspapers Limited, undertook "to continue to provide financial support".
The accounts note that the "ultimate controlling party" is Viscount Rothermere, the son of Lord Rothermere, the legendary Fleet Street press baron. Viscount Rothermere is chairman of the Daily Mail and General Trust. He is estimated to be the 23rd richest man in Britain.
