O'Brien's loans to struggling radio group hit €94.4m, accounts reveal
Loss-making Communicorp has debt mountain of €217m
DENIS O'Brien loaned his loss-making radio group Communicorp €8.3m last year. This brings the total amount of interest-free loans the telecom's tycoon has given to the company to €94.4m.
The loans are revealed in accounts for Communicorp that owns Today FM and NewsTalk and radio stations in Bulgaria, the Czech Republic, Estonia, Finland, Hungary, Latvia and Jordan.
They show that in 2010 Communicorp made a pre-tax loss of €2.3m. This follows a €5.3m loss in the previous year. The company was sitting on accumulated losses of €38.3m at the end of 2009.
Details of the new accounts were published in the 'Sunday Business Post'. Mr O'Brien's spokesman did not return phone calls yesterday.
The company's performance last year was hit by hefty interest payments of €6.9m it paid on some of its loans but not those lent to the company by Mr O'Brien.
Communicorp has total debts of almost €217m. This includes €115.3m in bank loans to Ulster Bank and Bank of Ireland. It also repaid €4.5m worth of loans to Mr O'Brien.
The radio group's revenues rose from €65m in 2009 to €68.4m last year. Its Irish radio stations provided the bulk of these revenues, accounting for €38.9m of Communicorp's total income in 2010.
The company's directors stated in the accounts that market and trading conditions "continued to be difficult" last year as economic uncertainty affected spending on advertising.
However, they said that a focus on increasing revenues while cutting costs had "secured the future and provided the group with a firm platform for continued growth".
Communicorp made an operating profit of €4.9m last year, up from €2.7m in 2009, but its large loan interest payments made it loss making.
Other outgoings include rental payments of €1.5m to a company director for premises and transmitter site rentals. The directors are O'Brien, Lucy Gaffney, Paul Connolly, Maria Mahon and Paddy Halpenny.
The company had 702 staff last year, down from 740 in 2009, and had a wage bill of €16.8m. Its directors shared €369,000 in salaries and fees and €61,000 in pension payments.
Mr O'Brien founded Communicorp in 1989 when his consortium won the licence to operate a new radio station in the Dublin area. He set up 98FM and in 1992 moved into the Czech Republic.
In 2004, the company acquired Metromedia radio group that included radio stations in six central and eastern European countries.
It added another radio station in the Ukraine in 2006 and two years later opened new stations in Jordan. Communicorp now has 43 radio stations in eight countries.