The media and advertising intermediary PubliGroupe achieved a net profit of CHF 28.6 million in the first half of 2006. Sales increased by 2.9 percent to CHF 1,035 million. All business activities increased, PubliGroupe reported on Monday.
In the first half of the year, the Vaud-based company did not perform quite as well as in the previous year, when it reported a profit of CHF 46.7 million, boosted by increases in the value of the securities portfolio. The financial result was at a normal level. However, excluding these increases in value, the net result improved by 1.9 percent compared to the previous year.
Improvement in all main segments As expected, advertising expenditure in the developed markets remained stable or increased only slightly, according to PubliGroupe. Asia and the online media as well as categories of electronic media showed a more dynamic development than the print media. However, the print media successfully defended their continued strong position.
The biggest contribution to the 2.9 percent increase in sales came from the international division Publicitas Promotion Network (PPN), which grew by 18.6 percent, and from the "Business under development" segment (Consulting/E-Business, Electronic, Digital & Interactive Media), which increased by 36.6 percent. PubliDirect grew by 1.7 percent and PubliPresse declined slightly by 0.9 percent.
Strong increase in "Business under development" The investments made in 2005 for the development of the Group in the areas of online and electronic media (see
Publigroupe aims for a top position with electronic media) have paid off. In the half-year results as at July 2006, the business in the "Consulting/E-Business Electronic, Digital & Interactive Media" division achieved an increase in sales of 36.6 percent to CHF 40.3 million. This means that the Group has almost reached break-even.
The consulting company Namics increased its turnover by 45.9 percent to CHF 13 million. Further expansion is expected.
Cinecom increased its sales by 32% to CHF 23.3 million. Cinema advertising increased by 9 percent. Cinecom is now benefiting from the digitalization of cinema advertising - the cinema medium is now more attractive for local advertising orders. Television advertising increased by 35% and the representation of the new channel 3+ is expected to lead to a further increase in sales.
Web2com, the marketer of advertising in interactive media, grew by 59.3% and generated sales of CHF 5 million. This segment was therefore in the black for the first time.
PubliDirect at a high level The PubliDirect business segment increased sales by 1.7 percent to a high level of CHF 52.6 million - despite expansion costs for the new Local.ch search engine and expansion of the shareholdings in The Guide Company (see
PubliGroupe expands its stake in The Guide Company).
Sales of local telephone directories increased by 12 percent, while the printed Yellow Pages grew by 4 percent with an unchanged circulation.
PubliPresse in a difficult environment PubliGoupe reports that the marketing of advertising by the Swiss press and its online services took place in a difficult and competitive environment with high volatility. Sales fell by 0.9 percent to 767.7 million. PubliPresse suffered from the decline in commercial advertising. For the first time in three years, real estate advertising also declined (-3.4 percent). Only job advertisements showed an unbroken growth trend with an increase of 18.7 percent.
International marketing of press advertising The Publicitas Promotion Network (PPN) division, which markets press advertising internationally, increased sales by 18.6% to CHF 183.9 million. Business in Asia/Australia was particularly successful (+24%) and business in Europe also recovered noticeably (+23.3%). North and South America remained negative (-7.7 percent).
Outlook PubliGrouope no longer expects a turnaround in the advertising market this year. The trends observed in the advertising market in the first half of the year will continue in the second half. Sales should continue to increase thanks to foreign markets and electronic media. The marketer of radio advertising, RadioTele AG, which has been integrated into the Group since July 2006, will also contribute to this. The company plans to invest a further CHF 8 million in the further development of the business. Although the operating result was in line with analysts' expectations, the PubliGroupe share fell slightly in trading by midday.