Absolute Radio reports £2.5m loss

Absolute Radio made a pre-tax loss of £2.5 million in 2012, down 37.4 per cent year on year despite flat revenues after the Olympic slump brought on a "year of two halves".

Absolute Radio: reports loss
Absolute Radio: reports loss

In an annual report that is due to be published by Companies House this week, Absolute Radio's parent group TIML Radio, is set to report revenue of £16.71 million in 2012, up just 0.4 per cent year on year.

Absolute Radio said in the report that although in the first half of 2012 revenues climbed by 18 per cent year on year, continuing the trend set by the 15 per cent growth in 2011, this growth "stalled" in the second half of the year.

The slowdown in ad revenues was a result of the "disruptive effects" of the Olympic and Paralympic Games on the media market, Absolute Radio said.

Adrian Robinson, the chief financial officer of Absolute Radio, said: "2012 was a year of two halves, as they say at football matches. The Olympics affected most media organizations in some way.

"We had a buoyant first half, which collapsed in the second half. A feature of being one of the smaller stations, you tend to be able to outperform when the market is rising and struggle more when the market is struggling."

The wider radio market increased by 3.8 per cent in 2012, according to the Radio Advertising Bureau, although that includes the contribution of local advertising. However, the national airtime market increased by just 0.5 per cent year on year.

As turnover was largely the same as 2011, the majority of the decline in losses in 2012 can be attributed to the cutting of administrative expenses, which declined by 7.2 per cent (or £1.50 million) to £19.24 million.

In Absolute Radio’s 2011 annual report its directors noted the business had recorded a profit across the last four months of 2011. Robinson said this improvement had continued into 2012 and might have been sustained if "the market had not been so benign".

The radio ad market has been tough in 2013. Robinson said that no months, apart from January, have shown year-on-year growth in national airtime and there have been "very severe year on year declines in some months".

"Not withstanding that, we’re doing better in 2013 than we did in 2012," Robinson said.

Bauer Media agreed a deal to buy Absolute Radio for around £23 million in July this year and the two radio groups are currently discussing the regulatory implications with Office of Fair Trading.

A spokeswoman for Absolute Radio was not able to confirm a time frame for when the deal might go through.

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