Today FM, the longest-established national commercial radio station in the Republic, has reported strong profits and improved margins in its first set of results produced entirely under the ownership of UK media giant Emap.
The station, which until recently was the only national competition for RTÉ, has reported a pretax profit of €2.9 million for the six months to March 31st, 2006. This was on turnover for the six months of €8.8 million.
Emap came to own Today FM - which employs presenters such as Ian Dempsey and Ray D'Arcy - in 2005 when it bought Scottish Radio Holdings for €588 million. The valuation of Today FM was not disclosed during that transaction.
Despite the strong results, the company warned that the "principal risk" to its business came from competitor stations and particularly new licences likely to be issued by the Broadcasting Commission of Ireland (BCI) in coming years.
Some people in the commercial radio sector have complained that the BCI risks "saturating" the market.
Emap did not take a dividend or management charge out of the business. The station now employs 79 staff, up from 77 in the last set of accounts issued.
This is the first set of accounts produced for a six-month period for the station, so comparisons with previous annual accounts are difficult. However, the station's margin at an operating level in the six months to March 31st, 2006, rose to 28 per cent.
This compared with a 23 per cent operating margin in the full year to September 30th, 2005, when its last set of accounts were released.
Based on a first-half turnover of €8.8 million, the station could expect to produce full-year turnover of €17.6 million, which would be an increase on the last full-year figure of €15.1 million.
The only caveat here is that the current accounts include the Christmas period, which tends to be financially rewarding for advertising-dependent businesses such as commercial radio.
Today FM chief executive Willie O'Reilly acknowledged that the accounts covered the busy revenue months of October to March. "Notwithstanding this, we are reporting strong revenue growth coupled with prudent management of costs," he said.
"This is reflected in an operating margin of 28 per cent for the period compared to 23 per cent for the full year. The company has now generated €7,580,592 in retained profits since it was first licensed by the BCI in 1997."
Emap owns three stations in the Irish market - Today FM, Highland Radio and FM 104. Since becoming involved in the Irish market, the group has sought to boost margins, control costs and grow market share.
Results for Co Donegal station Highland Radio have also been released, showing a pretax profit of just over €500,000 for the year to March 31st, 2006, up from €251,994 previously.
The latest profit for the only commercial station in the county was recorded on turnover of €2.5 million, up from €2.1 million in the previous period.
The station has effectively doubled its pretax profits under Emap's ownership. Emap was not the owner during the entire period, but was in charge for seven months.
