The Irish Times Ltd, publisher of the The Irish Times, has reported a profit before tax of €14.1 million for 2005, after taking a restructuring charge of €5 million. John McManus, Business Editor, reports.
Operating profits before the restructuring charge is taken into account were €18.1 million, in line with the €18.3 million reported in 2004. Pretax profits in 2004 were €19 million.
The €5 million charge related primarily to a redundancy programme which will be completed this year and should cut recurring overheads by €4.5 million.
Turnover in 2005 was €113 million, an increase of 8.5 per cent on 2004. The company said advertising revenue was ahead 9.5 per cent in the year, but no figure was disclosed. Circulation of The Irish Times rose 2 per cent to 117,456 copies per day.
Costs rose by 9.5 per cent to just over €94 million, with much of the increase attributed to an 8.2 per cent rise in employment costs and higher newsprint prices. Deputy managing director Liam Kavanagh said the higher employment costs were due to a number of factors, including rising pension costs, implementing the national wage agreement and taking on additional staff. It also included a staff profit share.
During the year, the company also invested in a rebranding of The Irish Times under the slogan "We look at life. You live it" .
Mr Kavanagh said staff numbers are due to fall this year under a voluntary severance scheme that is part of the restructuring programme. The company is on target to shed between 35 and 40 jobs and cut overheads by €4.5 million, he said.
The accounts show that the Irish Times Ltd's share of the losses incurred by Fortunegreen were €103,000. Fortunegreen is a joint venture with Metro International and Associated Newspapers. The Irish Times Ltd is a 45 per cent shareholder in the company, which publishes the Metro freesheet distributed to commuters in the Dublin area.
"We have just finished the first year of the three-year plan for Metro and are reasonably satisfied with the way things are going," said Mr Kavanagh. "It is establishing itself firmly on people's advertising schedules and should break even within 12 months."
Itronics Ltd, the wholly owned subsidiary which operates the Ireland.com website and a number of other businesses, lost €250,000 last year. "With the acquisition of MyHome.ie and the increasing use of broadband, we expect to see significant developments in the internet arena. Ireland.com is well set to capitalise on that," Mr Kavanagh said. The Irish Times Ltd agreed to buy online property site MyHome.ie for €50 million in July.
Commenting on 2006, Mr Kavanagh said the immediate outlook was still positive, with advertising remaining strong, particularly in the key areas of recruitment and property.
The company has adopted the Financial Reporting Standard Number 17 in respect of how the liabilities of the group pension scheme are calculated. Under this method the net liabilities of the scheme are €50.6 million compared to €35 million in 2004. The increase in liabilities was due to a deterioration in bond yields and changes in mortality projections.
A funding programme agreed with the Pensions Board to address the deficit is on track and the scheme will be reviewed at the start of next year, said Mr Kavanagh.
Shareholders' funds stood at €41.2 million at the year end, after accounting for the pension obligation. The Irish Times Ltd is ultimately controlled by The Irish Times Trust Ltd.
Since the year end the company has sold its former premises on D'Olier Street for €29 million and moved to Tara Street.