Ad revenue at UTV's Irish radio division drops 16pc
UTV suffered a 16pc fall in ad revenues at its Irish radio stations last year but expects the rate of decline in its Radio Ireland division to slow to just 6pc for the first four months of 2010.
The prediction came yesterday as the Belfast-based plc reported a 24pc rise in pretax profits for 2009 as lower debt costs and cutbacks more than compensated for a 6pc fall in group revenue.
Radio Ireland was the weakest performer in the portfolio, with the five stations here booking a 16pc fall in like-for-like revenues against an 8pc advertising fall at UTV's Great Britain radio division.
The discrepancies between Radio Ireland and Radio GB are continuing into early 2010 and UTV expects the first four months to show a 3pc fall in ad revenues at Radio GB and a 6pc fall in advertising at Radio Ireland.
UTV commercial director Jim Downey said that, while there were no full-year forecasts for Radio Ireland, it was "difficult to see the Irish market in positive territory for the year".
"We're not holding out much hope for a major recovery in Ireland, but then if you look at Great Britain, at the turn of the year we didn't see that market recovering as quickly as it did either," he added.
Despite persistent weakness in the Irish market, UTV has yet to take any writedown on the value of its stations here, including Q102, FM104 and LMFM.
"We still think our valuations are appropriate," Mr Downey said, adding that it would take a long-term deterioration of the Irish environment to prompt a revaluation of the £124m (€138m) Irish portfolio.
As well as facing pressure on topline advertising, Radio Ireland will also face a squeeze on the bottom line next year as the controversial broadcasting levy swings into force.
The Belfast broadcaster yesterday joined other radio stations in criticising the levy. Mr Downey insisted the extra cost could lead to major difficulties for smaller stations.
Radio Ireland accounted for £24.8m of UTV's £112.1m revenues, with Radio GB accounting for another £68m and the remainder split between TV and new media.
The group's 2009 operating earnings were split between a £9.4m contribution from Radio GB, a £7m contribution from Radio Ireland and a £5.3m contribution from TV.
Mr Downey stressed that while the Irish outlook remained uncertain, UTV was "optimistic" about the 2010 prospects of Great Britain.