Irish Times posts €2.5m operating profit

A SMALL rise in turnover and a reduction in overheads enabled The Irish Times Ltd to record an operating profit of €2.5 million in 2011.

This compared with an operating loss of €633,341 in 2010, the company’s latest accounts show.

Operating profit and loss are a reflection of the company’s day-to-day trading activities and do not take account of exceptional costs or finance charges incurred by the business.

A €3 million exceptional item – primarily redundancy costs – and other expenses relating to its pension scheme and associate businesses pushed the company into the red last year.

The Irish Times Ltd’s latest accounts show that it made a total loss of €1.8 million in 2011, compared with just under €1.1 million in the previous 12 months.

Turnover, including from joint ventures, rose to €90.9 million last year from €89.2 million in 2010. Excluding joint ventures, turnover rose to €87.6 million last year from €85.9 million previously.

The cost of sales was flat at €58.5 million while distribution costs were unchanged at €10.8 million. Administrative expenses fell by 13.5 per cent to €14.8 million.

Commenting on the accounts, managing director Liam Kavanagh said: “We are very satisfied with the results. In particular, we had a good second half to the year. There was a lot more buoyancy to revenues and some of our cost-saving initiatives began to come through.

“We also preserved most of our cash and we will now be looking to kick on from here with the implementation of a number of exciting new projects for the group.”

The Irish Times Ltd closed 2011 with net cash of €9.5 million, down from €10.7 million in the previous year.

However, its pension liability widened in 2011 to €43.1 million from €27.9 million previously. This related to an increase in the value of plan liabilities due to a reduction in bond yields.

As of December 31st, 2011, Mr Kavanagh was paid a salary of €270,000 while the editor, Kevin O’Sullivan, who was appointed in June 2011, was earning €220,000.

Mr Kavanagh agreed to a 10 per cent reduction in his salary last year from €300,000 in 2010.

Mr Kavanagh said the concept of parity in pay between the managing director and editor remains in place. The difference in the respective salaries at the end of last year was the result of a benchmarking exercise of senior management remuneration undertaken by the group.

This resulted in a salary range being introduced for the positions of managing director and editor.

Mr Kavanagh and Mr O’Sullivan are currently at different points in the range.

Deputy editor Denis Staunton, who assumed the role in July 2011, receives a salary of €150,000.

The fee paid to David Went, chairman of The Irish Times Ltd, was reduced last year to €67,000 from €87,000 in 2010.

The fee paid to Ruth Barrington, chairwoman of The Irish Times Trust Ltd, was reduced to €31,000 in 2011 from €41,000 in the previous year.

The accounts also note an ex-gratia payment of €250,000 to former editor Geraldine Kennedy in 2010, relating to a commutation of pension rights accrued under her employment contract.