Future goes from profit to loss in full-year results
Publisher caps difficult year with a net loss of £18 million
Future Publishing's full year financial results reflected the difficulties it has been facing in the transition from print to digital.
The UK-based company posted full-year revenues of £141.7 million, a drop of 6 per cent over last year's total of £151.5 million. It made a net loss of £18 million, a steep decline from £5.6 million in profit last year, and its net debt increased from £4.4 million to £11.8 million.
According to the report, the company has extended its bank facility by 12 months to November 2013, and suspended all dividend payments until some time in the same year.
The twelve months prior to September 30 2011 - the period covered by the report - were tumultuous for Future Publishing. In May, the company's half-year report showed a near 50 per cent drop in profits, subsequently announcing redundancies and restructuring in both its UK and US offices.
Several key employees resigned in the same period, including CEO Stevie Spring and finance director John Bowman, while senior group editor Steve Jarratt took voluntary redundancy.
The report stated that restructuring in its US office - which suffered "significant loss driven by print" - will continue into the next financial year, with a goal of reducing operating costs by £4.5 million.
However, Future describes the performance of its UK business as "resilient", its print losses offset by 36 per cent growth in its digital products. Future has now launched more than 100 products for tablet devices, and called the early success of Apple's "News Stand" as "encouraging."
"Building on the digital success in the UK, we have taken steps to reorganise the company, merge UK and US operations and create a single global product line," said Future's new CEO Mark Wood.
"These changes will enable us to operate more efficiently and return the US business to profitability. The changes will also mean that we can accelerate our transition to a digital business model and start to sell our entire range of digital content to high-value audiences in the US and other key markets."