INM upbeat about interest in South African business but challenges remain
INDEPENDENT News & Media remains upbeat about the interest in its South African business which is for sale but warned today that challenges remain in its main markets.
The publisher has appointed Investec and Hawkpoint to review its options in relation to the South African business and has been encouraged by the interest shown by a number of parties “as it ascertains whether a disposal is deliverable on acceptable terms in the best interest of the company.”
The company said in an interim management statement that in constant currency terms, for the 45 weeks to November 9 2012, total group revenues have declined by 3pc, ad revenue is down by over 5pc while operating costs have been reduced by 0.7pc. despite inflationary pressures in South Africa.
INM added that significant debt levels at the firm need to be addressed and the need for substantial and urgent restructuring remains following on from a relocation of the firm’s headquarters to Talbot Street, Dublin 1, as well as cost-cutting reorganisations at the Belfast Telegraph and the Sunday World and, more recently, at its printing plant in Citywest.
According to the company, high unemployment, a challenging banking sector and a difficult Budget 2013 continue to impact on consumer sentiment and spending in Ireland.
Discussions with lenders, in a bid to refinance bank debt in advance of its maturity in May 2014, are ongoing and constructive, the company added.