Future losses grow as print continues to decline
Revenue has fallen by £16.6m to £66m at Bath-based listed media group Future as it continued to be hit by the rapid decline in print revenues.
It also plunged further into the red with pre-tax losses of more than £35m because of exceptional items of £24.3m, which included redundancy costs for the 403 staff who lost their jobs in a company-wide restructuring.
During the spring, a review of Future was started in efforts to cut costs and streamline the business.
It sold the sport and craft businesses to Immediate Media during July (2014) for up to £23.8m and a number of other titles in the auto business to Kelsey in August for up to £2.3m.
Outside the UK, Future also made changes to its offices in the US and Australia, with the transition to a digital model fast-tracked in the US.
The restructuring activities resulted in group headcount being reduced from 980 to 577 at the end of September, with a significant number of those affected being based in Bath.
Restructuring costs of £5.3m were incurred in the 12 months to 30 September 2014 in relation to the significant reduction in headcount, as well as other charges.
There was also a non-cash impairment of historical print-related goodwill of £16.8m, reflecting the impact of the structural decline of print and Future's planned transition to a digital model.
It pushed pre-tax losses from £2.2m a year ago to £35.3m.
UK sales contributed £53.1m to the £66m total, with another £13.7m coming from the US – the UK was down from £63.3m) and the US from £20.0m.
Digital and diversified revenues now represent 41 per cent of the total, up from 37 per cent in 2013. It was driven by strong growth in events and e-commerce, two areas the group considers to be of strategic importance.
Future also stressed in the preliminary results that it had "notably strengthened" its balance sheet, with a year-end net cash position of £7.5m from a debt of £6.9m.
Future's chief executive Zillah Byng-Maddick said: "We have now largely completed the transformation programme, which was initiated in June 2014, on time and according to plan. Our property portfolio has been rationalised, non-core businesses sold, our balance sheet strengthened and the cost base materially reduced.
"The business is now stabilised, although as we continue to grow our newer revenue streams and transition from a print-led business to a digitally diversified content business, there remain some elements of uncertainty around the pace of decline in the print market.
"Over the last three months, we have seen encouraging growth in higher margin e-commerce activities. We have market leading positions in all our portfolios and are building good momentum to take into 2015.
"Looking forward, we continue to see the encouraging trends seen in Q4 when the group as a whole returned to a positive EBITDAE position. We expect these trends to continue into Q1 2015."