28 September 2011
Pre-close Trading Update
Future plc, the international special-interest media group, today publishes a pre-close Trading Update in respect of its financial year to 30 September 2011. Preliminary results for the year then ended will be announced on 24 November 2011.
In general terms, the trends identified in the Group's Interim Management Statement published on 15 July 2011 have continued. Revenues for the twelve months ending 30 September 2011 are expected to be down 6% on last year, in constant currency. The Board remains comfortable with market expectations of results for 2011, subject only to any period-end adjustment required in relation to US newsstand returns, beyond those already announced and incorporated into fourth quarter estimates.
Full year revenues for the UK (more than 70% of Group revenue as it includes export, licensing, syndication and Australian revenues) are now estimated to be down 2%, compared with -3% at the half-year stage.
In July the Group announced a plan to re-organise the UK business, to ensure even faster growth in digital and more efficient execution of print. This plan is well-advanced, has reduced existing headcount by approximately 10% and will reduce the Group's property requirements.
In contrast and as previously announced, the position in the US is significantly more challenging, reflecting a combination of a much smaller scale of business; the radically different business model applicable to US magazine publishing generally compared with the UK; limited portfolio protection with exposure to only three special-interest sectors; and a faster-declining print advertising market.
In July the Group announced steps to accelerate the transition of Future US into a primarily digital business. However, with trading conditions in the US reflecting ongoing weakness and decreasing visibility at newsstand, and an acceleration in the year-on-year growth rate in digital revenues, the Board is now considering a wider range of strategic options in respect of its US operations.
A further update and the blueprint for 2012 and beyond will be provided with the year-end results.
As announced in July, the Group anticipates making provision for up to £3.5m of one-off exceptional cash costs primarily in relation to the significant headcount reductions in both UK and US but additionally anticipates making a provision for unoccupied UK property of up to £1.4m. The Group is actively marketing such property and an update will be provided with the annual results.
The Group's net debt at 30 June 2011 was £15.6m and the Group estimates that its net debt at 30 September 2011 will be less than £14.5m. On this basis, the Group expects to comply with all bank covenants.
As previously announced, Roger Parry retires from the Board at the end of the financial year (after ten years as Chairman) and this will take effect from today. His successor as Chairman, Peter Allen, joined the Board on 5 August 2011.
Stevie Spring, Chief Executive Tel: 020 7042 4007
John Bowman, Group Finance Director Tel: 020 7042 4031
Charles Palmer Tel: 020 7831 3113
Future plc is an international special-interest media group, listed on the London Stock Exchange (symbol FUTR). Founded in 1985 with one magazine, today we have operations in the UK, US and Australia creating 200 special-interest publications, apps, websites and events. We hold market-leading positions in games, film, music, technology, cycling, automotive and crafts. Our biggest-selling magazines include T3, Total Film, Classic Rock, Guitar World and Official Xbox Magazine. Our websites include gamesradar.com, bikeradar.com, musicradar.com and techradar.com (the UK's no. 1 consumer technology website). Future sells three million magazines each month; we attract more than 25 million unique visitors to our websites; and we deliver over 100 digital editions and bespoke apps on tablet. Future exports or syndicates publications to 90 countries, making us the UK's number one exporter and licensor of magazine content; and was named consumer digital publisher of the year at the Association of Online Publishers Awards 2011.