Results indicate media sector is making strong recovery

Media & Marketing: The Irish media sector appears to be in full recovery mode - at last.

Media & Marketing: The Irish media sector appears to be in full recovery mode - at last.

Based on the latest financial results and various indications from industry sources, there is plenty of cause for optimism.

This week, there were strong figures for Ireland's only privately owned TV station, TV3. In the three months ended August 31st, the station's profits and turnover were up sharply.

Now one of the largest advertising agencies in Dublin, Cawley Nea has reported a strong set of figures for 2003. Pre-tax profits rose from €952,816 to €1.4 million for the year, while gross profits were up to €5.3 million from €3.6 million.

READ MORE

The agency, which is now owned by TBWA, boasts an extensive client list. It has done work for 02, C&C, IAWS, Playstation and Dairygold among others. The ultimate owner of the company is US media giant Omnicom.

Cawley Nea paid a dividend to its shareholder in 2003 of €1.2 million, which was down from €1.9 million.

While advertising agencies are reporting plenty of new business, servicing clients is becoming a more expensive business. According to Cawley Nea's accounts, operating expenses rose from €2.7 million to €3.9 million.

Staff costs in particular were up from €1.8 million to €2.4 million. However, a lot of this is explained by a rise in staff numbers from 25 to 33.

However, the overall health of the figures is good news for the sector and media owners are also reporting strong sales returns. RTÉ, in particular, expects to produce very strong end-of-year figures.

Last year, it boasted a €2.2 million surplus (previously it had losses of €56 million) and some sources speculate it could even produce a surplus of between €3 million and €6 million this year.

However, the company is not prepared to comment at this stage.

Smoking takes toll

The market research firm AC Nielsen this week claims the smoking ban has taken a serious toll on pubs, but the impact has been limited for those offering outdoor seating.

The firm says the smoking ban, introduced on March 29th, "has changed consumer behaviour in some fundamental ways". It says while on-trade sales have been falling for some time, the smoking ban has accelerated these trends.

AC Nielsen measures sales in a large sample of pubs, clubs and hotels in Ireland. During the six months after the smoking ban was introduced, sales in the pubs declined on average by about 6 per cent, it says.

When it looked at pubs with outdoor seating and those without, the trends were even more stark. "In the six months since the ban, sales in the outlets without outdoor seating declined by about 13 per cent compared to the larger outlets with seating, where sales only declined by 0.5 per cent."

It says these trends could spell trouble for those pubs with no outdoor seating. "At this early stage, it would appear that pubs which do not have scope for the development of outside seating areas are going to come under increasing pressure."

Sports win at Sky

While British newspapers were full of gloomy reports about falling audiences for Premier League football last weekend, the latest figures from Sky Sports appear to contradict these suggestions. Sky Sports managed to attract 40 per cent of men in the 15 to 34 age group for the recent Manchester United versus Arsenal match on October 24th.

According to Dublin agency, AFA O'Meara, with 13 TV stations now available to Irish advertisers "the marketplace seems to be delivering strong audience numbers and revenues for the last two months of this year". It claims BSkyB may soon offer Irish advertising space on Sky Sports 3, and Sky One Extra to cater for demand.

TG4 bids for share

TG4 is celebrating its eighth birthday at present and, over the next few weeks, it will broadcast several programmes in an attempt to push up its ratings.

Agencies often claim the station punches above its weight with the advertising community. It will be interesting to see if the advertisers take space on two of the highlights of its autumn season.

On Wednesday, November 10th , the station will show exclusive live coverage of the "old firm" Scottish league cup match between Rangers and Celtic. Another programme sure to attract attention is Craiceann - An Sceal, which traces the story of Irish sexuality from the Neolithic period to the present day.

NTL turnover rises

A price increase and growth in digital subscriber numbers boosted NTL Ireland's turnover by 3.5 per cent to €26.5 million in the third quarter of this year.

EBITDA (earnings before interest, taxes, depreciation and amortisation) was down 17.6 per cent to €8.9 million. The company's total Irish customer-base increased by 2,500 to reach 343,000 (including MMDS customers). Digital customer numbers rose by 6,600 to 88,800 in the third quarter, compared to the same period last year.

eoliver@irish-times.ie ]