By Mark Sweney: Daily Mail (LSE: DMGT) & General Trust has said that it expects its regional newspaper business to return to revenue growth in the second half of 2010 for the first time in two years, as the company unveils plans to launch 150 apps in the next 12 months.
DMGT, which has just unveiled Apple (NSDQ: AAPL) iPad apps for the Metro newspaper and property site Primelocation, also said that the freeze on the government’s £200m-plus ad spend would not have a major impact on the business.
The DMGT chief executive, Martin Morgan, told journalists and analysts yesterday that public sector ad spend accounted for about 3% of total business to consumer revenues and within that, 7% to 8% of revenues at the Northcliffe Media regional newspaper division. This equates to a total public sector ad spend of about £18m, with about £10m spent on Northcliffe Media titles, according to revenue figures published by DMGT yesterday.
“Local media should move into year-on-year revenue growth in the second half of the year,” said Morgan, adding that it would take something “very major to blow us off course” from achieving that prediction. “Government-related advertising is actually a small part of overall advertising, we are not a major recipient of government spending.”
DMGT added that growth in private sector advertising was “taking up the slack” of any drop-off in bookings from the government and that the company’s business division expected to capitalise globally from moves to outsource public sector services.
Morgan said that the regional newspaper division, which has borne the brunt of the 500 job cuts DMGT said it made between September and 4 April, experienced a “bumpy April”. Overall trading during April and the first three weeks of May had seen property advertising up 9% and recruitment up 2% – the first growth in the recruitment category recorded in over two years.
The company said there would continue to be some job cuts at the Northcliffe division, but that “far and away the majority of job losses” are over, with DMGT expecting overall headcount to stabilise this year.
Separately AND, the consumer digital subsidiary of DMGT, has announced that it intends to launch 150 apps in the next 12 months. The digital division originally said in January that it would launch 15 apps in 2010.
However, after achieving this target in the first three months of the year the new, far more ambitious goal has been set.
AND uses the Teletext Mobile division to run DMGT’s mobile strategy and product development. The plan is for Teletext Mobile to act in the same way as, for example, a games publisher that makes its own products but also launches those of other developers.
The AND chief executive, Richard Titus (pictured), said that about half of the 150 apps would be developed for DMGT products and the remainder will come from third-party developers with ideas that the company believes are worth backing. Revenue will come from paid-for products and the significant critical mass of apps to sell ads across.
AND is home to websites including Jobsite, Findaproperty, Primelocation, Teletext Holidays and Motors.
“The Teletext Mobile team have impressively accomplished their goal of launching 15 apps in their first quarter of operation, so we’ve decided to raise the bar – targeting a total of 150 apps on a variety of platforms within the next 12 months,” said Titus.
