FT. WALTON BEACH, FL–(Marketwired – May 7, 2013) – Multi-Media Productions (USA), Inc. is pleased to announce that Global eTelecom, Inc. (GETI) will be airing on 21st Century Business on CNBC (as paid programming) on May 8, 2013 and on the Fox Business Network (as paid programming) on May 11, 2013. Click for CNBC Airing Schedule. Click for Fox Business Airing Schedule.
Since Simon Fox joined, the company’s share price has soared, but it still has a long way to go to catch up with its rivals
Trinity Mirror chief executive Simon Fox’s honeymoon period came to an abrupt end on Thursday with the arrest of four current and former senior journalists for alleged phone hacking, while a 75% slump in profits stripped £60m from the Daily Mirror publisher’s market capitalisation.
News of the arrests – the four, including former Sunday Mirror editor Tina Weaver and Sunday People editor James Scott were bailed later in the day – broke on Thursday morning as Fox was making his maiden financial results presentation and detailing his “One Trinity Mirror” master plan to a packed room of investors and analysts in the plush 16th floor City offices of merchant bank Rothschild.
Fox’s 85-page strategy document took a backseat to investor fright at the potential financial implications of a major widening of the phone hacking scandal, including potential compensation payments, with Trinity Mirror’s share price slumping almost 20% at one point in trading on Thursday, before closing more than 13% down. The share price had already taken an 8% nosedive that morning after Trinity Mirror’s 2012 full year results were released.
However, the City consensus is that Fox’s turn around plan for Trinity Mirror will not be derailed by one bad day at the office. “The company’s market capitalisation has now fallen by almost £60m but do we honestly believe the unfolding arrest scenario will have a financial impact of that or more?,” says Alex deGroote, analyst at Panmure. “No. It is an over-reaction, I do not believe [the Trinity Mirror phone-hacking arrests] is the next News International.”
Trinity Mirror’s share price has soared since Fox joined on 10 September from HMV, where he was also chief executive. Last week it hit an almost three year high of 123p before Thursday’s double dose of bad news, giving a market cap of £300m, as investors bought into the belief he can drive the publisher’s stagnant digital development.
“The share price was 36p when I joined but I am not going to attribute it to the ‘Fox effect’,” Fox said on Thursday. “The markets have been up in general, the tide is rising although not by that much [to account for Trinity's performance], the company has not been waiting until today to get started.”
However, Fox admitted that the company has a long way to go to catch up with rivals, with digital revenues from its newspaper business flat year on year.
Digital advertising revenues actually slumped by 7.3% year-on-year in 2012, although within this online display grew by 11%. It was digital classified advertising that slumped by 18% and led Fox to take the realistic step of a £60m non-cash writedown on the future potential earnings of websites such as SecsintheCity, Fish4jobs and SmartNewHome.
Fox’s digital strategy for reviving Trinity Mirror’s fortunes includes free iPad tablet editions for the Daily Mirror and Daily Record, with Android versions by the end of the month. He says he has not ruled out introducing charges for the tablet editions, as most Fleet Street rivals do, but not in the short term.
“We considered [charging] very carefully and keep it under review,” he says. “It is important to go for reach and get scale with an ad-funded model.”
With total digital revenues of £40.8m, less than 6% of the sales, Fox – like other newspaper publishers – is facing a major challenge if he is to fill the widening gap in Trinity Mirror’s balance sheet left by declining print income.
To help maintain profitability cost cutting led to the loss of 500 more jobs across the company last year, and a further 200 were targeted for redundancy at the beginning of this year, mostly in Trinity’s regional papers, as a more digitally-focused and content sharing strategy across titles was unveiled.
This forms part of a further £10m in cuts planned in 2013. However, 52 new editorial jobs are also being created – half in the national titles, half in regionals – to help provide more digital and tablet content. Fox has also grasped the nettle in the difficult issue of dealing with the steep declines of regional newspaper operations. Investors were cheered by the strategic initiative to take a 20% stake in David Montgomery’s Local World regional newspaper business in late 2012.
While competition issues surrounding Local World remain unresolved, the deal opens the door for a possible future disposal of Trinity’s embattled local titles, as rival Daily Mail & General Trust has managed by putting its Northcliffe regional division into the Montgomery joint venture alongside Iliffe News & Media’s papers.
Continuing talks over the potential sale of a stake in the Sunday People to a consortium led by former Sunday Express editor Sue Douglas would further reduce costs. Many investors view the People as non-core to the main Trinity Mirror national newspaper operation.
DeGroote says that the publisher’s balance sheet is in the best shape it has been for perhaps a decade, stripping out the non-cash charge profits were about £100m last year, and to watch this space for a buyer in the next few years.
His view is that the company’s net debt of £157m will be wiped out in the next two to three years, shareholders can look forward to their first dividend payout since 2008 next year, and it will produce £50m surplus free cashflow this year and next.
“If they can get the pension sorted they may end up being owned by some Russian oligarch or quasi-private equity house in the next two or three years in my view,” says DeGroote.
“In spite of revenue declines they have mastered profit protection. They remain trophy assets and a potential vanity project, buyers could be drawn in by the high profits of the core Mirror business and strong cash flows it generates. It is an attractive investment.”
Pre-tax profits in 2012: £18.9m (-75% year-on-year)
Adjusted pre-tax profits: £98.7m (+7.4%)
Revenue: £706.5m (-7%)
Advertising revenue: £292.8m (-10.4%)
Circulation revenue: £297.2m (-7.9%)
Digital revenue: £40.8m (+8.5%)
Earnings per share: 29.9p (+10.7%)
Net debt: £157m (-29%)
Spending cut showdown threatens Obama's second-term agenda
By Jeff Mason and Matt Spetalnick. WASHINGTON | Sat Mar 2, 2013 9:51pm EST. WASHINGTON (Reuters) – Just hours after across-the-board spending cuts officially took effect, President Barack Obama pressed Congress on Saturday to work with him on a …
'Dumb' says it all about Washington
Spending Cuts Imposed; US Starts to Trim Its Budget
White House and GOP trade verbal jabs as sequester deadline looms – live
E-commerce pioneer and government adviser Martha Lane Fox is to join the House of Lords, it is announced.
Continue reading here: Digital boss Lane Fox to get peerage
Increase related to acquisition of Fox Sports Australia and Fox Star Sports Asia and ‘improvements’ in publishing operations
Rupert Murdoch’s News Corporation has reported a doubling of quarterly profits but paid out a further $56m (£35.8m) in costs related to the News of the World phone-hacking scandal.
News Corp reported net profits of $2.4bn in the three months to the end of December, compared to $1.1bn in the same period a year earlier, on sales up 5% to $9.4bn. Most of the increased profits were related to the acquisition of the 50% stakes in Fox Sports Australia and Fox Star Sports Asia that News Corp didn’t already own.
Murdoch said the increase in profits was due to “double-digit gains” in News Corp’s cable TV businesses and “improvements” in its publishing operations, which includes the Sun, the Times, the Sunday Times and the Wall Street Journal.
The company said its publishing division, which reported a $16m increase in profits to $234m, benefited from the launch of the Sun on Sunday in February 2012.
The $56m in compensation payments and costs related to the News of the World take the total payout related to the phone-hacking scandal to more than $340m. News International, the division which controls the UK newspapers, is making a concerted effort to close down the hacking saga, agreeing out-of-court settlements on 143 of 165 outstanding civil damages cases it is facing in the high court before a key hearing before a judge on Friday.
Murdoch said News Corp was making progress in its plan to split the $54bn global empire into two separate publicly listed companies – a newspaper, book publishing and education division and a media and entertainment company. Work on splitting up the company cost the company $23m in the latest quarter.
Last week, News Corp said Will Lewis, one of the executives running News Corporation’s controversial management and standards committee dealing with the phone–hacking scandal, is moving to a new senior role with in the newspaper division’s headquarters in New York.
James Murdoch, Rupert Murdoch’s son and News Corp’s deputy chief operating officer, said he did not expect Liberty Global’s $23.3bn takeover of Virgin Media to effect the competitiveness of the cable TV market.