Chrysalis shares tumble 4% as weak radio ad market hits profits
LONDON - Chrysalis Group has posted a loss of £2.8m for the year ending August 31, after the downturn in radio advertising and problems at its book division, but said that its radio operations, which include Heart and Galaxy, should drive growth next year.
The pre-tax loss for 2005 compares with a profit last year of £7m, with turnover falling by 5% to £155.2m. The company's share price tumbled 4% when the London Stock Exchange opened this morning, down 5.5p to 137.5p.
Chrysalis was hit by a one-off charge at its books division, which it is in the process of disposing. It also blamed "volatile trading conditions" in the radio ad market for an 8.6% fall in revenues at the Chrysalis Radio division to £62.9m.
Chrysalis said that marketing campaigns supporting the arrival of Jamie Theakston as the new breakfast host at Heart FM had been very effective, with weekly listening hours up by 10% in the most recent Rajar figures, and in its elevation to the biggest commercial station in London for the first time.
Revenues at LBC were up 7% in spite of the weak ad market, and its line-up has also been strengthened over the year, with appointments including comedian Iain Lee as host of weekday drivetime, and Jenny Eclair, who hosts a weekend show.
Richard Huntingford, chief executive of Chrysalis Group, said: "2005 was a difficult year for the Chrysalis Group, reflecting advertising conditions in the UK and continuing problems with our books division -- but it was also a year when we made significant progress in executing our stated corporate strategy, enabling us to enter the current financial year as a focused radio and music publishing and distribution business."
The news was better at Chrysalis' music division where revenues rose 4.1% to £73.5m. It scored a number-one album with David Gray and saw a number of tracks by its artists feature in advertising, including Moloko's 'Sing it Back' for the worldwide Heineken television advertising campaign and 'Bohemian Like You' by The Dandy Warhols, used by Vodafone for the fifth consecutive year.
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