Fusion Corporate Partners

The Economist Group – Year end results for year-ending March 2011

• Revenue grew by 9% to £347m
• Advertising overall increased by 15%, with print advertising up 14% and digital advertising up 23%.
• Operating margin improved to 18.2%. The year benefited from an additional four months of the CQ acquisition and was also helped by a stronger dollar.
• Operating profit for the Group increased by 10% over last year to £63.3m.
• Costs increased by 8% overall, but were also affected by acquisitions and disposals and the stronger dollar.
• Underlying costs increased by 6%, partly driven by growth but mainly because of additional investments including marketing activity for The Economist, the development of digital editions and other initiatives.
• Profit before tax at £59.5m was 19% higher than last year.
• Interest costs increased by £1.0m, reflecting the full-year impact of borrowings taken out to finance the CQ acquisition, offset by the benefits of repaying other bank debt taken out to refinance earlier acquisitions.
• Profit after tax increased by 16% to £44.2m.
• Normalised earnings per share were 176.5p, an increase of 8% year on year.

The Board is recommending a final dividend of 78.5p, making the full-year dividend 112.6p. This is a 10% increase on the previous year, excluding the special dividend of 39.7p per share paid to shareholders in December.

According to Rupert Pennant-Rea, Chairman of the Economist Group, “This good result came mainly from three areas: an advertising recovery at The Economist; a full year’s ownership of CQ, the business we bought in August 2009; and tight control of overheads.”

The full annual report is available here.

UK, London