The Irish Times Ltd, publisher of The Irish Times, has reported a 25 per cent rise in operating profits before exceptionals to €22.7 million for 2006 on the back of a 14.3 per cent rise in turnover to €129 million.

After taking a once-off €1.1 million charge for the completion of a restructuring programme, the company had an operating profit of €21.6 million.

A pretax profit of €43.49 million reflected the €22.33 million profit achieved on the sale of the company's former office at D'Olier Street, Dublin. Pretax profits in 2005 were €14.13 million.

"The big driver was the growth in advertising revenue, which was up 12.5 per cent," said managing director Maeve Donovan yesterday. Revenues from advertising were not disclosed, but the increase last year compared with a 9 per cent rise in 2005.

Property advertising was particularly strong in 2006, although recruitment and other advertising streams also performed well.

While Ms Donovan said she believed a soft landing was under way in the property market, she said the advertising market generally was in a good position.

"We're very positive about trading for 2007," she said. "There's no reason to believe otherwise. The Irish Times is very well positioned in terms of the mix of advertising sectors in which we operate. We have a tremendous mix."

Circulation was stable during the year and readership of the newspaper remained constant at 336,000, the company said.

"We still see potential to develop and grow the newspaper and to continue to be the pre-eminent print publisher in the daily market," said Ms Donovan.

Contract printing at the company's press at Citywest made a "strong contribution" to the overall business, said deputy managing director Liam Kavanagh.

In results for a year in which The Irish Times Ltd moved to new offices in Tara Street, the company attributed a 12.2 per cent rise in costs to €106.75 million to increased employment costs and an increase in the cost of newsprint.

While the completion this year of a restructuring programme will reduce the newspaper's staff by 35-40, the number employed by the company at large rose to 558 last year from 550.

This increase reflected the purchase of the myhome.ie property advertising business.

"Myhome was an absolutely critical strategic asset for us to acquire," Ms Donovan said. "Given our strength in that sector, it was of commensurate value to us."

Myhome was acquired in mid-October at an up front cost of €45.78 million. An additional €11.05 million payment is conditional on performance between 2009 and 2011. The Irish Times Ltd took on non-recourse debt of €10 million to part-fund the transaction. In the final 10 weeks of 2006, Myhome made a contribution of €372,852 to operating profits.

Itronics Ltd, the wholly owned subsidiary which runs the newspaper's Ireland.com website and Irish Times Training, reported a loss of €180,000. The company believes this business will move to profitability "in the foreseeable future".

Ms Donovan said the combination of Ireland.com, myhome.ie and a 30 per cent investment in entertainment.ie would leave The Irish Timeswell-positioned when advertising on the internet in Ireland exceeds print and radio advertising, as in the British market.

Asked about the integration of newspaper editorial operation with the Ireland.com operation, she said: "We're in the midst of examining issues that arise on the back of integration. It's still at an early stage."

Ms Donovan said The Irish Timesremained on the lookout for opportunities to acquire "assets of significant scale and of significant quality" and embryonic or development projects, such as its investment in Gloss magazine and in the Gazette group of local papers in Dublin.

Gloss had received good support from London-based fashion and interiors advertisers, she said.

After the introduction of a new Gazette title in Dundrum in Dublin, Ms Donovan said the company would seek further expansion opportunities for that business.

The Irish Times'sshare of the losses of the Metro freesheet was €2.23 million. "It's a three-year plan and we're happy with how the plan is going," said Mr Kavanagh.

An actuarial gain of €23.25 million helped to reduce the deficit in the company pension fund to €24.72 million. The gain was attributed to improving bond yields, good investment returns and advance payment of contributions.

However, Mr Kavanagh said the development would not allow the company to move away from a 10-year funding proposal agreed three years ago with the Pension Board.

After accounting for pension obligations, shareholders' funds rose to €99.29 million at year-end from €41.17 million in 2005.