Morning business news - April 26Friday 26 April 2013 10.47
INM SET TO RESTRUCTURE PENSION PLAN AS LOSSES GROW - Independent News and Media has announced results for 2012 and a restructuring of its debt facilities. The three part restructuring deal will see the disposal of its South African operations INMSA; a standstill agreement with lenders; and a reduction in the group's obligations relating to its Irish pension scheme. The company will also raise €40m in new equity. This restructure will reduce the core debt of the group to €118m, with other facilities of €8m. The media group also announced financial results for last year which show a loss before tax of €254.9m, compared to a loss of €63.6m in 2011 Revenue at the group was down 3.3% at €539.7m.
Vincent Crowley, Independent News and Media's group's chief executive officer, says the restructuring of the company's pension plan is a key step in its overall restructuring. He says that talks are ongoing with the pension trustees and the company's staff and he admits the changes will involve some cuts in benefits for staff. Assuming that the company gets through the restructuring and capital raising plan, the CEO says it will have a sustainable level of debt of about €118m. Mr Crowley denies that the company is trying to wind up the company's defined pension benefit scheme. ''Winding up the scheme is not an attractive option for anyone,'' he states.
Turning to the company's annual results, Mr Crowley says that IMN's loss for 2012 is largely comprised of non-cash write-offs of mast heads and other impairment charges. He says that when those factors are excluded, the underlying operating profits of the business came to about €60m for the year. He says that though profits are down from last year, the business remains extremely profitable despite the fact that the advertising market remains ''tough''.
On the expected introduction of a metered paywall on independent.ie in the second half of the year, Mr Crowley said that it remains to be seen what the takeup is. He says that the board's company has seen significant changes over the past year and its 11 members have a wide range of skills. Looking to 2013, Mr Crowley says that ad revenues are down by double digit figures so far this year. He says the Irish market is tough, but the company is largely compensating for this with cost reductions.
MORNING BRIEFS - Building materials group CRH has announced it is buying the Lafarge-owned Mykolaiv Cement in Ukraine for €96m.
*** Dublin based Fineos, which produces claims management software for the insurance industry, is one of three firms announcing new jobs today. It is creating 50 jobs in Dublin, while Naas based Opensky, which makes software products to the food manufacturing, retail and public sectors, will create 30 jobs over the next 18 months. Business technology consultancy Storm Technology is also creating 21 jobs.
*** Following Apple's fall in quarterly profit earlier this week, its rival Samsung Electronics has posted a record quarterly profit, boosted mainly by growing sales of its smartphones. It made a net profit of $6.4 billion in January, February and March, up from $4.5 billion a year ago. Samsung displaced Apple as the biggest smartphone maker last year, and smartphones have been behind of its success. Their sales leapt 7% compared to the previous quarter, accounting for around 75% of the company's profits. The firm predicts though that growth in smartphone sales would stay flat in the coming months amid intensifying competition in the lower and middle sections of the market.